But while it is relatively straightforward to understand what cryptocurrencies like Bitcoin and even Ethereum are, it is more difficult to get your head around the Hyperledger initiative. But if you do, you’ll find some exciting projects for non-currency, industrial blockchain applications.
What is Hyperledger? A Brief Hyperledger Tutorial
Let’s start with what Hyperledger is not: Not a company. Not a cryptocurrency. Not a blockchain. Not an IBM blockchain coin.Hyperledger is rather something like a hub for open industrial blockchain development. On its website Hyperledger explains:
“Hyperledger is an open source collaborative effort created to advance cross-industry blockchain technologies. It is a global collaboration, hosted by The Linux Foundation, including leaders in finance, banking, Internet of Things, supply chains, manufacturing, and Technology.”
Hyperledger does not support Bitcoin or any other cryptocurrency. But the platform is thrilled by blockchain technology. Not since the Web itself, the website tells, “has a technology promised broader and more fundamental revolution than blockchain technology.” Blockchains has the potential to “build a new generation of transactional applications that establishes trust, accountability, and transparency at their core while streamlining business processes and legal constraints.”
Hyperledger’s Organizational Structure Insights
The governance structure of the Hyperledger project is designed to ensure effective collaboration and decision-making. Two key components of this structure are the Technical Steering Committee (TSC) and Special Interest Groups (SIGs).
Technical Steering Committee (TSC)
The TSC plays a crucial role in overseeing technical decisions within the Hyperledger project. Comprised of elected members, it provides guidance on the overall direction and strategy of the project. The TSC ensures that technical standards are maintained, reviews proposed projects, and approves new additions to the codebase.
Special Interest Groups (SIGs)
In addition to the TSC, Hyperledger also relies on Special Interest Groups (SIGs) to focus on specific areas within the project. These SIGs bring together individuals with expertise in various domains such as healthcare, supply chain, finance, identity management, and more. Each SIG focuses on advancing Hyperledger’s capabilities in their respective areas through research, development, and collaboration.
The modular architecture of Hyperledger allows for flexibility and specialization within these SIGs. By dividing into focused groups based on specific industries or use cases, Hyperledger can address unique challenges faced by different sectors while maintaining a cohesive framework.
Diverse Membership Base
One of the strengths of Hyperledger lies in its diverse membership base. It brings together industry leaders from finance, technology, healthcare, supply chain management, and other sectors. This diversity fosters cross-industry collaboration and ensures that multiple perspectives are considered when making decisions.
The participation of organizations from various backgrounds enhances the credibility and robustness of Hyperledger’s solutions. It enables a comprehensive approach towards developing blockchain technologies that can be applied across different industries.
By leveraging its diverse membership base effectively through SIGs and the TSC’s
So we have a lot of promises – and we have Hyperledger. With it, the Linux Foundation aims to create an environment in which communities of software developer and companies meet and coordinate to build blockchain frameworks. The Linux Foundation founded the platform in December 2015. In February 2016 it announced the first founding members, in March 2016 ten more members joined.
Today Hyperledger has an impressive list of more than 100 members. The list covers a wide scope of well know industry leaders. It includes mobility tech giants like Airbus and Daimler, IT-companies like IBM, Fujitsu, SAP, Huawei, Nokia, Intel and Samsung, financial institutions like Deutsche Börse, American Express, J.P. Morgan, BBVA, BNP Paribas and Well Fargo, as well as Blockchain startups like Blockstream, Netki, Lykke, Factom, bloq and Consensys. A lot of the world’s largest companies in Tech and Finance meet at Hyperledger with some of the hottest blockchain startups.
Something like the executive government of Hyperledger is the committee of leaders. It consists of more than 10 executives, most with decades of experience in Open Source and tight connections to several industries. You’ll find leaders of the Apache Foundation and the W3C Consortium as well as engineers from IBM and more. Some of Hyperledgers’s members, like Richard Brown and Tamas Blumer, already worked with Blockchain for years. For its members, Hyperledger does not only provide technical knowledge and software frameworks but also various contacts to industries and developers.
Relatively early in the history of Hyperledger, the project had to make an important decision. Executive Director Brian Behlendorf was asked if there will be an “Hyperledger Coin”, a monetary unit running on the Hyperledger blockchains. Behlendorf answered that the Hyperledger Project itself will never build its own cryptocurrency.
“You’ll never see a Hyperledger coin,” he said, “By not pushing a currency, we avoid so many political challenges of having to maintain a globally consistent currency.”
This decision strongly shaped the strategic goals of Hyperledger to build industrial applications of blockchain technology and sharply separating it from the get-rich schemes usually evolving from currency based blockchains. This might be more boring, but also more straightforward to technology.
Further, a “charter” outlines the goals of Hyperledger, like a mission guide. According to it, the platform aims to “create an enterprise-grade, open-source distributed ledger framework and code base” and create, promote and maintain an open infrastructure.
This is somehow telling, but somehow vague. It outlines some kind of program, but doesn’t answer the big, important questions: What do all these world-leading companies and leaders do at Hyperledger? What projects are they pushing forward? Who participates?
Ethereum Vs. Hyperledger
Both Ethereum and Hyperledger can be distinguished based on the following parameters:
- Purpose of the Platforms
- Operation Mode
- Peer Role
- Confidentiality Level In Each
- Consensus Mechanism
- Programming Languages
Hyperledger-based technology works using these layers:
- A consensus layer, which makes an agreement on order and confirms if the transactions in a block are correct.
- A smart contract layer, which processes and authorizes transaction requests
- A communication layer, which manages peer-to-peer (P2P) message transport.
- An API, which allows other applications to communicate with the blockchain.
- Identity management services, which validates the identities of users and systems.
The “umbrella strategy” of Hyperledger incubates and promotes a range of business blockchain technologies, framework, libraries, interfaces, and application. Currently, Hyperledger is the host of the following projects:
This is a modular blockchain suite developed by Intel, which uses a new consensus algorithm called Proof of Elapsed Time (PoeT).
Iroha is a project of a couple of Japanese companies to create an easy to incorporate the framework for a blockchain.
Hyperledger Fabric (Hyperledger IBM):
This project is lead by IBM. Fabric is a plug and plays implementation of blockchain technology designed as a foundation to develop high-scaling blockchain applications with a flexible degree of permissions.
This project develops a permissible smart contract machine along the specification of Ethereum.
A tool for building blockchain business networks.
Hyperledger Explorer is a blockchain module and one of the Hyperledger projects hosted by The Linux Foundation. Designed to create a user-friendly Web application, Hyperledger Explorer can view, invoke, deploy or query blocks, transactions and associated data, network information (name, status, list of nodes), chain codes and transaction families, as well as any other relevant information stored in the ledger.
Hyperledger Indy is a collection of tools, libraries and further components for digital identities rooted on blockchains.
A blockchain as-a-service deployment model.
Besides these framework projects, Hyperledger has several tool projects aiming to make access to and development of blockchains easier and more effective.
Hyperledger obviously engages in a wide scope of non-monetary blockchain projects. But this rough view on these projects must remain dissatisfying, as the short descriptions don’t go far beyond keywords. So we take a closer look at the two most prominent projects: Sawtooth and Fabric. Both projects are created by large companies – Intel and IBM – and given to Hyperledger as open-source code. With Hyperledger the companies continue pushing their blockchain projects forward, while everybody else is invited to contribute.
Hyperledger Sawtooth (Intel)
Sawtooth Lake is Intel’s modular blockchain suite. It is written in Python and designed for use cases in many fields from IoT to Financials. The dominant characteristics of Sawtooth Lake are that it supports both permissioned and permissionless application and deployments and that it uses a newly developed consensus algorithm called Proof of Elapsed Time (PoET).
PoET uses new secure CPU instruction, which is more and more available in new processors like Intel builds. With these instructions, PoET ensures a safe and random selection of a so-called “leader”. This can be compared with bitcoin mining, in which the miners compete for one-time access to write the blockchain. Other than Bitcoin’s proof algorithm, PoET doesn’t need specialized mining hardware.
To become a leader, every “validator” – which equals to a node or a miner – needs to use the secure CPU instruction to request a wait time. The validator with the shortest wait time will be elected as a leader. Like every good mining, algorithm PoET works like a lottery with the price to get write access to the blockchain.
Other than with cryptocurrencies there is no reward for the leader. It is just part of running the software. So there will be no energy-burning competition like in cryptocurrencies. Every node simply can use its CPU – as long as it is a new model and, maybe, from Intel – to participate in the leader selection for no costs. What is mining in Bitcoin, is simply a non-intrusive part of the software in Sawtooth Lake.
Another innovation of Sawtooth Lake is the building and propagation of transactions. A client builds transactions and submits it to the validators. This wrap the transactions they get inside of a batch and commits them to the state altogether. This is a similar, but not identical process as when cryptocurrency miners wrap transactions to a block. With this batching Sawtooth solves the problem of securely validating transactions that depend on each other.
To date, Sawtooth is tested in several applications. It is tested to record the journey of seafood from the ocean to the table, using IoT sensors, and track ownership, possession, and parameters through the whole supply chain, from the fisherman to the supermarket. The buyer can access a complete and trustless record of the whole live chain of the seafood. This use case in supply chain and product history is increasingly discussed for Blockchains.
Sawtooth is also tested to streamline the process of transferring bonds. The developers created a user interface to track and transfer bonds. With this users can manage a whole portfolio of bonds on the blockchain. Another use case of Sawtooth currently tested are digital assets. The developers built a platform for managing digital asset ownership on the Sawtooth blockchain, which could be able to manage a wide scope of digital assets. The connecting dot between this application of Sawtooth seems to be the marketplace for digital assets of any kind which is built in the blockchain and already has a graphical interface for users.
While these tests are ongoing and Sawtooths enjoys a wide industry interest, the project seems to get less traction than IBM’s contribution to Hyperledger.
Maybe the most interesting project in the Hyperledger family is IBM’s Fabric. Rather than a single blockchain Fabric is a base for the development of blockchain-based solutions with a modular architecture. Fabric different components of Blockchains, like consensus and membership services can become plug-and-play. Fabric is designed to provide a framework with which enterprises can put together their own, individual blockchain network that can quickly scale to more than 1,000 transactions per second.
What is Fabric and how does it work? The framework is implemented in Go. It is made for enabling consortium blockchains with different degrees of permissions. Fabric heavily relies on a smart contract system called Chaincode, which every peer of the networks runs in Docker containers. An overview of Fabric’s technology can be found in the manual.
While not completely and generally permissioned, Fabric allows enterprises to make parts of the blockchain, if not all, permissioned. Participants usually need to register to get the permission to join and issue transactions on a Fabric based blockchain. To use resources more efficiently, Fabric has fewer nodes than a public chain and computes data massively in parallel, which makes Fabric scale much better than public blockchains. Also, its basic architecture supports confidential data, giving its members more privacy as they find on a public blockchain.
Maybe most important is the separation between so-called “Endorsers” and “Consensus Nodes”. If you are familiar with cryptocurrencies like bitcoin you will recognize the separation between miners and nodes. The Endorsers have the state, and build, validate and propagate transactions and chaincode, while the Consensus Nodes orders the already validated transactions. While this separation has not been a concept of the first blockchain concept of Satoshi Nakamoto, but became an unwished reality in most cryptocurrencies, Fabric is one of the first to make this separation a design principle. This enables Fabric, for example, to implement a better division of labour, so that not every peer of the network has to do every job.
While having no native currency, Fabric allows the user to define assets from client side and use them with the Fabric Composer. Fabric’s Chaincode Smart Contracts framework is similar to Ethereum: Chaincode defines the business logic of assets, the rules for reading and altering the so-called state of the assets. Like Ethereum Fabric maintains not a set of unspent outputs, as bitcoin maintains, but the state of the blockchain which is not restricted to transactional data.
Other than the public blockchains of cryptocurrencies Fabric allows participants to build a separate channel for their assets and hence isolate and segregate transactions and a ledger. With this method, the chaincode needed to read and alter the state of an asset will only be installed on peers involved in this certain business case. Like in good chat programs Fabric’s blockchains allow the user to participate in both open and private interactions.
Beyond this IBM proposes an alternative design for public and permissionless blockchains. Fabric uses a public key infrastructure to generate cryptographic certificates tied to organizations and users. So it is possible to restrict data and channel access to certain actors.
Fabric’s strength seems to be the high grade of flexibility in permission and privacy while enabling high scalability through a more advanced division of labour of network participants.
For IBM Fabric serves as a flagship project for blockchain development. The IT giant uses Fabric for a variety of its own projects and for collaborations with several business partners.
In March 2017 IBM launched IBM Blockchain, a service that enables developers to “quickly build and host security-rich production blockchain networks on the IBM Cloud.” With this move, IBM catches up with Microsoft, which long integrated blockchains in its Azure Cloud.
However, while Microsoft is just a cloud host for several external blockchains, IBM heavily promotes its own blockchain framework, Fabric, for a lot of use cases. For example, at the end of March, Natixis and Trafigure partnered with IBM to use a blockchain based on Fabric for commodity trade finance for US crude oil transactions. All major steps in a crude oil transaction are digitized on the blockchain, massively improving transparency, efficiency, and security.
In April IBM announced several new blockchain projects based on Fabric: The company partnered with Sichuan Heijia to build up a blockchain based supply chain platform for pharmaceutical procurements. In the same month, IBM started to cooperate with Japan’s Mizuho Financial Group and Mizuho Bank to create a blockchain based platform for trade financing. This projects aim to streamline trading operations and improve supply chain efficiency.
In another project disclosed in April 2017 IBM cooperates with the National University of Singapore to develop a module on financial technology to improve the student’s education in this area. Finally, in May 2017, IBM was chosen as a partner of TenneT, Sonnen and Vandebron to develop a blockchain for managing the electric grid in the Netherlands and Germany.
Use Cases and Projects Powering Hyperledger Adoption
Hyperledger, with its robust and versatile framework, has gained significant traction across various industries. Let’s explore some of the notable use cases and projects that are driving the adoption of Hyperledger.
In the finance sector, Hyperledger Fabric is being utilized to streamline processes and enhance transparency. For instance, TradeLens leverages Hyperledger Fabric to revolutionize global supply chain management by providing end-to-end visibility and real-time data sharing among stakeholders. This not only reduces paperwork but also minimizes delays and disputes in international trade.
Supply chain management is another area where Hyperledger shines. We.Trade, built on top of Hyperledger Fabric, offers a secure platform for banks and businesses to manage their trade transactions efficiently. By leveraging smart contracts, it automates processes such as order creation, invoicing, and payment settlement while ensuring trust among participants. This significantly reduces administrative overheads and enhances overall supply chain efficiency.
In the healthcare industry, privacy and security are paramount concerns. Hyperledger Indy addresses these challenges by providing digital identity solutions that enable patients to securely share their medical records with healthcare providers while maintaining control over their personal information. This empowers individuals to have greater control over their health data while ensuring compliance with regulations such as HIPAA.
Governments around the world are also recognizing the potential of Hyperledger technology. The Dubai government has launched “Dubai Blockchain Strategy,” which aims to make Dubai a blockchain-powered city by 2020 using Hyperledger Fabric as one of its key components. This initiative aims to streamline government services, reduce bureaucracy, increase transparency, and enhance citizen trust through secure digital transactions.
IoT (Internet of Things):
The Internet of Things (IoT) is an emerging field that can greatly benefit from the capabilities offered by Hyperledger frameworks. By utilizing technologies like Hyperledger Sawtooth or Fabric, IoT devices can securely exchange data and execute transactions in a decentralized manner. This opens up possibilities for various applications, such as supply chain tracking, smart energy grids, and connected healthcare devices.
The backbone of non-monetary, industrial blockchain technology?
While there is a lot of information available on Sawtooth and Fabric, there is less known about the other projects. Maybe these projects first have to grow and mature to be a subject of media releases, tests and real-world application. But the best-known projects, Sawtooth and Fabric, are interesting and seem to be backed by strong IT companies. It will be interesting to see if Hyperledgers succeeds in connecting these blockchains, for example by developing tools which can be used with all Hyperledger blockchain frameworks.
Staying Updated with Hyperledger Developments
To stay informed about the latest updates and developments within the Hyperledger ecosystem, there are several key strategies you can employ. By following official Hyperledger channels such as the website, blog, and social media platforms, you can gain valuable insights into new releases, advancements, and community-driven initiatives.
Participating in community events is another effective way to stay updated with Hyperledger developments. Meetups and webinars provide opportunities to engage with like-minded individuals who are actively involved in the ecosystem. These events often feature presentations from industry experts, offering valuable insights into ongoing projects and emerging trends.
Engaging with the global Hyperledger community is crucial for staying up-to-date. Joining mailing lists or forums allows you to connect with other members of the community, ask questions, share ideas, and discuss relevant topics. This level of engagement not only keeps you informed but also provides a platform for collaborative learning and networking.
By actively participating in these channels and events, you can keep your finger on the pulse of Hyperledger developments. This knowledge will enable you to make informed decisions regarding your own projects or potential career opportunities within this rapidly evolving technology space.
While most other blockchain projects focus on cryptocurrencies and tokens, the projects around Hyperledger demonstrate a strong potential to build the backbone of non-monetary, high scaling industrial applications of blockchain technology. With interesting concepts and leaders in the technology behind, Hyperledger has not the worst chances to win this prize.
Frequently Asked Questions
What is Hyperledger?
Hyperledger is an open-source collaborative effort created to advance cross-industry blockchain technologies. It provides a range of frameworks, tools, and libraries that allow businesses to build and deploy their own blockchain networks securely.
How does Hyperledger differ from other blockchain platforms?
Unlike public blockchains like Bitcoin or Ethereum, Hyperledger is designed for permissioned networks where participants are known and trusted. It offers privacy, scalability, and flexibility for enterprises to develop customized blockchain solutions tailored to their specific needs.
Which industries can benefit from Hyperledger?
Hyperledger has applications across various industries such as finance, supply chain management, healthcare, manufacturing, and more. Its modular architecture enables organizations in different sectors to leverage blockchain technology for improved transparency, efficiency, and trust in their operations.
Is Hyperledger suitable for small businesses?
Yes, Hyperledger can be beneficial for small businesses too. Its customizable nature allows companies of all sizes to implement blockchain solutions according to their requirements. By utilizing the features offered by Hyperledger frameworks like Fabric or Sawtooth, small businesses can enhance security, streamline processes, and gain a competitive edge.
How can I get started with Hyperledger?
To begin with Hyperledger development or implementation:
Choose the appropriate framework (e.g., Fabric) based on your business needs.
Familiarize yourself with the documentation available on the official Hyperledger website.
Join the community forums or attend meetups/events related to Hyperledger.
Explore tutorials and sample projects provided by the community.
Start experimenting with building your own blockchain network using Hyperledger tools.