Blockchain for Business with Hyperledger Fabric

A complete guide to enterprise blockchain implementation using Hyperledger Fabric

Nakul Shah

• Publisher: BPB Publications
• Year: 2019
• eBook ISBN: 9789388511650
• Topic: Ciencia de la computación
• Subtopic: Aplicaciones empresariales

Step-by-step guide to understand the business implementation of Hyperledger Fabric Key Features

• Learn the basics of blockchain and Distributed Ledger Technology from a business and enterprise perspective
• Understand the advantages of Hyperledger Fabric and get acquainted with its architecture and tools used
• Acquire skills to create, deploy and interact with Chaincode in Node.js
• Learn to set up a new Hyperledger Fabric network
• Demystify Chaincode, in Fabric, for developers and operators
• Develop knowledge to invoke Chaincode from Fabric SDK and create APIs
• Get acquainted with the production environment for Fabric business networks

Description
In 2016, enterprise "blockchain" was a new concept. There were very few players in the private permissioned blockchain space. The advent of Hyperledger Fabric has since brought its tech in front of the likes of multi-national companies across various sectors like banking, insurance, retail, and more. Corporations and startups, across the globe, have started moving towards Hyperledger Fabric to find new use cases to support business requirements efficiently. As a result, relevant technical expertise and knowledge is required to build and support solutions on Hyperledger Fabric. This book aims to equip you with enough knowledge of enterprise blockchain platforms in conjunction with skills to use Fabric in order to succeed in the role of a Blockchain developer or Subject Matter Expert.
The book starts with a brief introduction to the world of blockchain. The book will cover all aspects of fabric ranging from network setup, to use case deployment and testing. Several examples have been covered in this book which will provide you a hands-on understanding of the subject. You will also learn to use the basic functions, libraries and packages required in a Fabric business network deployment. What You will Learn
This book will help the reader learn techniques for developing enterprise applications using Hyperledger Fabric. It will also help understand why blockchain is being regarded as a game changing technology within the business world. Reader will learn to deploy Fabric based business networks and chaincodes, and will come across case studies to put their knowledge to practice and solve real-life business problems using Hyperledger Fabric. Who This Book Is For
The book is intended for anyone looking for a career in blockchain, all aspiring Hyperledger Fabric SMEs who want to learn the most powerful innovation of the current time or working professionals who want to switch their career to blockchain by using Hyperledger Fabric – one of the most commonly used business platforms for blockchain. While no prior knowledge of Blockchain or Fabric is assumed, it will be helpful to have some programming experience. Table of Contents

• Blockchain and Decentralization
• Introduction to Hyperledger and Composer
• Basics of Hyperledger Fabric
• Frameworks, Network Topologies and Modelling
• Chaincode in Hyperledger Fabric
• Fabric SDK: Interaction with Fabric Network
• Fabric SDK: Building End-to-End Application with Fabric Network
• Fabric in Production
• 
  About the Author
  Nakul Shah is the Founder and Director of Sate Development - India's leading Blockchain Company. He is a regular speaker at conferences across the globe, on topics like Blockchain, Hyperledger and Distributed Ledger Technology. As a longtime creative thought leader in financial markets, technology and innovation, he has worked with startups and multinationals across the world.
  Nakul has multiple years of experience in research, development and deployment of solutions using Blockchain Technology. Besides creating enterprise solutions, he also provides training, consultancy and development services, helping clients de-mystify the technology and understand how organizations can leverage its key features.
  Nakul has conducted lectures for banks, universities and governments, on various topics covering platforms and use cases of blockchain.
  Nakul has played a significant role in the adoption and application of technology. He started his career at State Street Corporation in Boston, which is one of the biggest and oldest providers of mutual fund, pension processing and asset custody services. He used advanced statistical and technical tools in the field of socially responsible investment. He also served as a Product Specialist for the wealth management team at Charles River Development. While executing independent consulting assignments, he has advised a leading sustainability firm that helps Fortune500 companies.
  Nakul holds a Master's degree in Financial Engineering from The University of Michigan Ann Arbor, USA. His LinkedIn Profile: https://www.linkedin.com/in/giancarlozaccone/
  

Chapter 1

Blockchain and Decentralization

After World War II, organizations started leveraging databases for their operations. As the use of databases increased, companies realized there was a need to share this data—both, within an organization as well as across companies all over the globe. The Internet revolutionized the process of sharing data by making it seamless to exchange information. It also opened doors for new possibilities in the world of digitization, like Internet banking, social media, online ticketing, and more.

However, since the inception of the Internet, there has always been a need for realtime, low-cost connectivity and exchange of money (or value) through some form of the Internet of trust.

Trust has always been a missing element within the Internet. Trust is what the banks and other financial institutions laid their foundations on. Since people couldn't trust each other with their money, they would go to the banks hoping that the bank would keep their money safe and give it back when requested. This trust shook up during the global meltdown of 2008. As banks began to collapse, people started losing their trust in banks and realized the need for a reliable e-cash system through which two people could exchange value without the need for a central counterparty, to mitigate fraud. Thus, people wanted to exchange money the way they exchange information over the Internet. This hope became a reality in 2008 when a white paper went viral over the Internet. The paper described the working of Bitcoin, which was a protocol that allowed people to exchange value (in the form of cryptocurrency) without the need of any central authority and outside the control of any government or jurisdiction. Since its early days, Bitcoin has always stayed in the grey area, with central authorities debating about its legality and a surge in Bitcoin's use on the dark web.

While this parallel debate was going on regarding the legality of Bitcoin, some financial institutions started looking under the cover. They wanted to understand the technology that was making their existence moot—a technology that enabled people to transfer value, across borders, without the need for central authorities like banks, and with no failures or frauds. Thus, blockchain came to the forefront. Blockchain is the technology that underpins Bitcoin. It is a decentralized distributed transaction database to which you can write new data, but you can never edit or delete it. It is immutable!

In this chapter, we will focus on the following key topics:

• Background of Bitcoin and blockchain
• Working of blockchain and its key concepts
• Operation of wallets and the role played by mining in running a blockchain network
• Building blocks of a blockchain and structure of a block
• Decentralization and distributed systems
• Enterprise blockchain networks
• Difference between public and private blockchain

This would help lay the foundation as we move towards Hyperledger, which is one of the most widely used enterprise blockchain platforms.

Definitions

Let us start by defining certain important terms that would be used repeatedly in this book. These terms are used as common jargon while discussing blockchain and would thus benefit you in understanding the chapters better:

Cryptocurrency

It is defined as any digital or virtual currency leveraging cryptography for security. Many researchers, financial institutions, academics, and others are considering cryptocurrency as the money of future or a twenty-first-century unicorn. Cryptocurrencies are based on blockchain technology using decentralized systems.

A striking feature of cryptocurrencies is they are neither issued by a government authority nor controlled by any organization. This makes them immune to third-party interventions or manipulations. The first blockchain-based cryptocurrency, conceptualized in 2008, was bitcoin.

Main features of a cryptocurrency are as follows:

• It serves as a digital asset that is used as a medium of exchange.
• It controls supply and secures transactions by use of advanced cryptography. These cryptography techniques are comprised of hash functions and digital signatures.
• It is a subset of alternate currencies.

The underlying technology that enables the exchange of digital coins or assets between individuals is termed as blockchain.

Bitcoin

The term crypto refers to encryption algorithms and techniques like public key/ private key pairs. These technologies were combined with hash functions to develop the first well-known (and currently most popular) cryptocurrency called bitcoin that was launched in 2008-09 by an individual/corporation under the pseudonym "Satoshi Nakamoto." Bitcoin was released as virtual money or token with an intent to disrupt the financial markets and as an alternative to paper-based currency. It leverages a collection of cryptographic concepts and blockchain technology to store and transmit value among users.

Bitcoin's modus operandi is a combination of the following key components:

• Proof-of-Work (PoW) consensus algorithm that serves as a decentralized peer-to-peer network.
• Blockchain technology that is used as a transaction ledger.
• A decentralized and mathematically bound mining and token issuance method.
• A verification method used with the help of transaction scripts.

Blockchain

The best way to define a blockchain is by drawing an analogy between a blockchain and a commuter train. We are all aware of how a train moves to transport people— it is structured in the form of multiple compartments and each compartment is linked to the next. Thus, if one compartment is removed from the middle of a train, the entire train will collapse because of loss of connectivity. A blockchain operates in a similar manner. It consists of blocks (instead of compartments) that are connected in a linear fashion such that each block, apart from carrying its own data, also has a signature (in the form of a hash function) to the previous block. This ties a new block to the previous one. If one of the blocks is removed from the blockchain, the entire chain will collapse because of loss of connectivity, just like in a train.

The first type of blockchain, that is, Blockchain 1.0, comprised of simple ledgers that could only record transactions. This basically refers to the Bitcoin blockchain that was implemented to simply record transactions in an immutable manner. As Bitcoin gained popularity, the industry realized that a blockchain is capable of much more. Thus, Blockchain 2.0 evolved where smart contracts were created. Smart Contract is a framework that enables users to execute logical code for various programs on a blockchain. Thus, several operations can run on this new technology. This concept came to market with the advent of Ethereum. Now, enterprises are looking at leveraging blockchain and distributed ledger technologies to create enterprise-grade applications. One of the most widely used environments for this is Hyperledger, which we will cover in detail in the later chapters of this book.

Following are some of the commonly used definitions of blockchain:

• A blockchain is a distributed database of records or public ledger of all transactions or digital events that have been executed and shared among participating parties.
• A blockchain is referred to as a peer-to-peer distributed ledger that has a cryptographically calculated algorithm with consensus (like PoW) that makes it immutable.
• A blockchain is defined as a data structure with a linked-list-format connecting blocks of transactions.

How Bitcoin works

Bitcoin allows people to send money (or value in the form of tokens) in a way that is similar to sharing information via an email or text—that is, online! To understand how a transaction takes place within the Bitcoin network, le...

Table of contents

• Cover
• Blockchain For Business With Hyperledger Fabric
• Copyright
• About the Author
• Acknowledgements
• Preface
• Errata
• Table of Contents
• 1. Blockchain and Decentralization
• 2. Introduction to Hyperledger and Composer
• 3. Basics of Hyperledger Fabric
• 4. Frameworks, Network Topologies, and Modeling
• 5. Chaincode in Hyperledger Fabric
• 6. Fabric SDK: Interaction with Fabric Network
• 7. Fabric SDK: Building End-to-End Application with Fabric Network
• 8. Fabric in Production