2017 was the year of Blockchain. Bitcoin and other cryptocurrencies rose in value, and several businesses adopted blockchain for various use cases. One flavor of blockchain that is the subject of discussion especially in institutions that have sensitive data and regulatory compliances, is permissioned or private blockchain.
Permission-based blockchains could add value that Bitcoin has not, like complying with regulations (HIPAA, anti-money laundering (AML) and KYC, for example). For traditional institutions that will be unwilling to switch to a completely public blockchain, a private blockchain is a great first step towards a more secure future. One big advantage of private blockchains over centralized databases is the cryptographic auditing and known identities. Nobody can manipulate the data, and mistakes can be traced back. When compared with a public blockchain, it’s a lot cheaper, faster, and respects the company’s privacy.
There are many private blockchain projects under development, some of which include The Hyperledger project from the Linux Foundation, the Gem Health network and R3CEV’s Corda. We’re going to make a case for Hyperledger for permissioned blockchain.
Hyperledger, an umbrella project by Linux foundation has launched its own open source enterprise permissioned blockchain framework called Hyperledger Fabric in 2017 which is designed specifically to meet the ease of implementing industry-agnostic permissioned blockchains. And it has already been successfully implemented in the banking, finance, and retail industries.
Building enterprise permissioned blockchain based application with hyperledger fabric
What makes hyperledger fabric so powerful and must-adopt when one is looking for an enterprise permissioned blockchain based application?
Modularity and interoperability exists in almost all the layers right from consensus, smart contract to the communication layer among the nodes. Each and every service can be plug and played. Designers have the right to choose what consensus they want their fabric network to work with, which CA should provide the certificates for the participating nodes and what nodes comes under the trusted group for transaction endorsement(verification) and commitment.
As a part of modular architecture, hyperledger supports plug and play of any type of consensus algorithms such as PoW (Proof of Work), PoS (Proof of Stake), PoET (Proof of Elapsed Time) or the RBFT (Redundant Byzantine Fault Tolerance). But one has to be careful in choosing the right consensus for his own use case since this contributes to the performance and scalability of the entire block chain
3.Private ledgers through channels
Hyperledger allows set of members within the network to participate as private groups through channels. Each channel can have its own chain with separate genesis block, identity management, endorsement policies and a member can be a part of multiple channels too.
4.Flexible trust model
Through its endorsement policy, one can specify the list of entities that are part of the trusted group for a chaincode (the smart contract) execution for a channel.
5.Flexible Identity Management
Hyperledger fabric provides its own MSP (Membership Service Provider) for authenticating and managing identities that participate in the permissioned network. But it allows each participating member to bring in their own identity management service if they prefer to reuse instead of rebuild.
6.Persisted State Database
Data regarding the current state of the chain is stored in a database for efficient reads and queries from chaincode. Supported databases include CouchDB and LevelDB.
7.Efficiency through isolated operations
Hyperledger provides way to have operation-specific dedicated nodes. For instance, we have an orderer node(s) whose only purpose is to group endorsed transactions into blocks. And we have endorsing peers which are nodes dedicated for endorsing the transactions submitted by clients. Hence we isolate transaction execution from commitment which results in increased efficiency.
Want to Explore More for permissioned blockchain with Hyperledger Fabric? Check out our other Blockchain services