Discuss the Prosperity Paradox from Chapter 7 of Blockchain Revolution.

Hands-On Blockchain with Hyperledger

Building decentralized applications with Hyperledger Fabric and Composer

Nitin Gaur Luc Desrosiers Venkatraman Ramakrishna Petr Novotny Dr. Salman A. Baset Anthony O'Dowd

BIRMINGHAM – MUMBAI

Hands-On Blockchain with Hyperledger Copyright © 2018 Packt Publishing

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Foreword In my role as the chair of the Hyperledger Technical Steering Committee, I've come to realize the great divide between the enormous hype surrounding blockchain and the depth of understanding of how blockchain technology works, where the technology is on the maturity curve, and how it might be leveraged in the context of the enterprise.

Most of the hype relates to the cryptocurrency aspects of public, permission-less blockchain—ICOs as a substitute for more traditional IPOs, and the potential for disrupting traditional systems of banking, insurance, securities, and so on. It is the potential for disruption and the asymmetric profits that disruption might yield that have driven many to explore how blockchain might be used to one company's advantage over the rest of a given domain. However, what many are discovering is that blockchain is a team sport, and for blockchain to be successful in an enterprise, it demands a degree of industry collaboration not seen before.

The authors of this book take you beyond the hype. They lay a solid foundation for understanding the state of the technology landscape—including active and incubating projects under development at Hyperledger. They provide you with a framework for choosing the right technology platform, designing your solution, and integration with existing systems. And they explain the various governance models for establishing and operating a blockchain business network.

If you are an enterprise architect or developer tasked with developing a blockchain solution for your enterprise or industry, this book is a must-read.

Cheers,

Christopher Ferris IBM Distinguished Engineer, CTO Open Technology

IBM Digital Business Group, Open Technologies

Contributors

About the authors Nitin Gaur, as the director of IBM's Blockchain Labs, is responsible for instituting a body of knowledge and organizational understanding around blockchain technology and industry-specific applications. Tenacious and customer focused, he is known for his ability to analyze opportunities and create technologies that align with operational needs, catapult profitability, and dramatically improve customer experience. He is also an IBM Distinguished Engineer.

Luc Desrosiers is an IBM-certified IT architect with 20+ years of experience. Throughout his career, he has taken on different roles: developer, consultant, and pre-sales architect. He recently moved from Canada to the UK to work in a great lab: IBM Hursley. This is where he had the opportunity to join the IBM Blockchain team. He is now working with clients across multiple industries to help them explore how blockchain technologies can enable transformative uses and solutions.

Venkatraman Ramakrishna is an IBM researcher with 10 years of experience. Following a BTech from IIT Kharagpur and PhD from UCLA, he worked in the Bing infrastructure team in Microsoft, building reliable application deployment software. At IBM Research, he worked in mobile computing and security before joining the Blockchain team. He has developed applications for trade and regulation, and is now working on improving the performance and privacy- preserving characteristics of the Hyperledger platform.

Petr Novotny is a research scientist at IBM Research, with 15+ years of experience in engineering and research of software systems. He received an MSc from University College London and PhD from Imperial College London, where he was also a post-doctoral research associate. He was a visiting scientist at the U.S. Army Research Lab. At IBM, he works on innovations of blockchain technologies and leads the development of blockchain solutions and analytical

tools.

Dr. Salman A. Baset is the CTO of security in IBM Blockchain Solutions. He oversees the security and compliance of blockchain solutions being built by IBM in collaboration with partners such as Walmart and Maersk, and interfaces with clients on blockchain solutions and their security. He drives the implementation of the General Data Protection Regulation for blockchain-based solutions. He has also built the identity management system, used by Fortune 500 companies involved in global trade digitization, and IBM Food Trust blockchain solutions.

Anthony O'Dowd works in IBM's Blockchain team. He is based in Europe as part of a worldwide team that helps users build solutions that benefit from blockchain tech. Anthony has a background in middle and back office systems, and has led the development of key IBM middleware in enterprise messaging and integration. He likes to work in different industries to understand how they can exploit middleware to build more efficient, integrated business systems.

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Table of Contents

Title Page

Copyright and Credits

Hands-On Blockchain with Hyperledger

Packt Upsell

Why subscribe?

PacktPub.com

Foreword

Contributors

About the authors

Packt is searching for authors like you

Preface

Who this book is for

What this book covers

To get the most out of this book

Download the example code files

Conventions used

Get in touch

Reviews

1. Blockchain – Enterprise and Industry Perspective Defining the terms – what is a blockchain?

Four core building blocks of blockchain framworks

Additional capabilities to consider

Fundamentals of the secure transaction processing protocol

Where blockchain technology has been and where it's going

The great divide

An economic model for blockchain delivery

Learning as we go

The promise of trust and accountability

Industries putting blockchain technology to work

Blockchain in the enterprise

What applications are a good fit?

How does the enterprise view blockchain?

Litmus testing to justify the application of blockchain technology

Integrating a blockchain infrastructure for the whole enterprise

Enterprise design principles

Business drivers and evolution

Ensuring sustainability

The principles that drive blockchain adoption

Business considerations for choosing a blockchain framework

Technology considerations for choosing a blockchain framework

Identity management

Scalability

Enterprise security

Development tooling

Crypto-economic models

Decentralization with systemic governance

Enterprise support

Use case-driven pluggability choices

Shared ledger technology

Consensus

Crypto algorithms and encryption technology

Use case-driven pluggable choices

Enterprise integration and designing for extensibility

Other considerations

Consensus, ACID property, and CAP

CAP

ACID

Attestation – SSCs are signed and encrypted

Use of HSMs

Summary

2. Exploring Hyperledger Fabric Building on the foundations of open computing

Fundamentals of the Hyperledger project

The Linux Foundation 

Hyperledger

Open source and open standards

Hyperledger frameworks, tools, and building blocks

Hyperledger frameworks

Hyperledger tools

The building blocks of blockchain solutions

Hyperledger Fabric component design

Principles of Hyperledger design

CAP Theorem

Hyperledger Fabric reference architecture

Hyperledger Fabric runtime architecture

Strengths and advantages of componentized design

Hyperledger Fabric – the journey of a sample transaction

Hyperledger Fabric explored

Components in a blockchain network

Developer interaction

Understanding governance in business networks powered by blockchain

Governance structure and landscape

Information technology governance

Blockchain network governance

Business network governance

Summary

3. Setting the Stage with a Business Scenario Trading and letter of credit

The importance of trust in facilitating trade

The letter of credit process today

Business scenario and use case

Overview

Real-world processes

Simplified and modified processes

Terms used in trade finance and logistics

Shared process workflow

Shared assets and data

Participants' roles and capabilities

Benefits of blockchain applications over current real-world processes

Setting up the development environment

Designing a network

Installing prerequisites

Forking and cloning the trade-finance-logistics repository

Creating and running a network configuration 

Preparing the network

Generating network cryptographic material

Generating channel artifacts

Generating the configuration in one operation

Composing a sample trade network

Network components' configuration files

Launching a sample trade network

Summary

4. Designing a Data and Transaction Model with Golang Starting the chaincode development

Compiling and running chaincode

Installing and instantiating chaincode

Invoking chaincode

Creating a chaincode

The chaincode interface

Setting up the chaincode file

The Invoke method

Access control

ABAC

Registering a user

Enrolling a user

Retrieving user identities and attributes in chaincode

Implementing chaincode functions

Defining chaincode assets

Coding chaincode functions

Creating an asset

Reading and modifying an asset

Main function

Testing chaincode

SHIM mocking

Testing the Init method

Testing the Invoke method

Running tests

Chaincode design topics

Composite keys

Range queries

State queries and CouchDB

Indexes

ReadSet and WriteSet

Multiversion concurrency control

Logging output

Configuration

Logging API

SHIM logging levels

Stdout and stderr

Additional SHIM API functions

Summary

5. Exposing Network Assets and Transactions Building a complete application

The nature of a Hyperledger Fabric application

Application and transaction stages

Application model and architecture

Building the application

Middleware – wrapping and driving the chaincode

Installation of tools and dependencies

Prerequisites for creating and running the middleware

Installation of dependencies

Creating and running the middleware

Network configuration

Endorsement policy

User records

Client registration and enrollment

Creating a channel

Joining a channel

Installation of chaincode

Instantiation of chaincode

Invoking the chaincode

Querying the chaincode

Completing the loop – subscribing to blockchain ev

ents

Putting it all together

User application – exporting the service and API

Applications

User and session management

Designing an API

Creating and launching a service

User and session management

Network administration

Exercising the application

User/client interaction modes

Testing the Middleware and Application

Integration with existing systems and processes

Design considerations

Decentralization

Process alignment

Message affinity

Service discovery

Identity mapping

Integration design pattern

Enterprise system integration

Integrating with an existing system of record

Integrating with an operational data store

Microservice and event-driven architecture

Considering reliability, availability, and serviceability

Reliability

Availability

Serviceability

Summary

6. Business Networks A busy world of purposeful activity

Why a language for business networks?

Defining business networks

A deeper idea

Introducing participants

Types of participant

Individual participants

Organizational participants

System or device participants

Participants are agents

Participants and identity

Introducing assets

Assets flow between participants

Tangible and intangible assets

The structure of assets

Ownership is a special relationship

Asset life cycles

Describing asset's life cycles in detail with transactions

Introducing transactions

Change as a fundamental concept

Transaction definition and instance

Implicit and explicit transactions

The importance of contracts

Signatures

Smart contracts for multi-party transaction processing

Digital transaction processing

Initiating transactions

Transaction history

Transaction streams

Separating transactions into different business networks

Transaction history and asset states

A business network as a history of transactions

Regulators and business networks

Discussing events from the perspective of designing a business network using Co

mposer

A universal concept

Messages carry event notifications

An example to illustrate event structure

Events and transactions

External versus explicit events

Events cause participants to act

Loosely coupled design

The utility of events

Implementing a business network

The importance of de-materialization

Blockchain benefits for B2B and EDI

Participants that interact with the blockchain

Accessing the business network with APIs

A 3-tier systems architecture

Hyperledger Fabric and Hyperledger Composer

Summary

7. A Business Network Example The letter of credit sample

Installing the sample

Running the sample

Step 1 – preparing to request a letter of credit

Step 2 – requesting a letter of credit

Step 3 – importing bank approval

Step 4 – exporting bank approval

Step 5 – letter received by exporter

Step 6 – shipment

Step 7 – goods received

Step 8 – payment

Step 9 – closing the letter

Step 10 – Bob receives payment

Recapping the process

Analyzing the letter of credit process

The Playground

Viewing the business network

A description of the business network

The participant descriptions

The asset descriptions

The transaction descriptions

The event descriptions

A model of the business network

Namespaces

Enumerations

Asset definitions

Participant definitions

Concept definitions

Transaction definitions

Event definitions

Examining the live network

Examining a letter of credit instance

Examining participant instances

Examining transaction instances

Submitting a new transaction to the network

Understanding how transactions are implemented

Creating business network APIs

SWAGGER API definitions

Querying the network using SWAGGER

Testing the network from the command line

Creating a new letter using SWAGGER

Network cards and wallets

Access-control lists

Summary

8. Agility in a Blockchain Network Defining the promotion process

Smart contract considerations

Integration layer considerations

Promotion process overview

Configuring a continuous integration pipeline

Customizing the pipeline process

Local build

Configuring Travis CI

Customizing the pipeline using .travis.yml

Publishing our smart contract package

Configuring your Git repository

Setting the code owners of our smart contract

Sample content of the CODEOWNERS

Protecting the master branch

Configuring Git for commit signing and validation

Configuring GPG on your local workstation

Testing the end-to-end process

Creating a new transaction

Pushing a commit to the master branch directly

Submitting a pull request with an unsigned commit

Adding test cases

Submitting a pull request with a signed commit

Adding the mergeAssets unit test

Releasing the new version

Updating the network

Notifying the consortium

Upgrading the business network

Downloading a new version

Updating the business network

Summary

9. Life in a Blockchain Network Modifying or upgrading a Hyperledger Fabric application

Fabric blockchain and application life cycle

Channel configuration updates

Prerequisites for adding a new organization to the network

Generating network cryptographic material

Generating channel artifacts

Generating the configuration and network components in one operation

Launching the network components for the new organization

Updating the channel configuration

Adding the new organization to the network

Smart contract and policy updates

Modification in chaincode logic

Dependency upgrades in chaincode

Ledger resetting

Endorsement policy update

Upgrading chaincode and endorsement policy on the trade channel

Platform upgrades

System monitoring and performance

Measurement and analytics

What should we measure or understand in a Fabric application

Blockchain applications vis-à-vis traditional transaction proce

ssing applications

Metrics for performance analysis

Measurement and data collection in a Fabric application

Collecting health and capacity information

Profiling containers and applications

Measuring application performance

Fabric engineering guidelines for performance

Platform performance characteristics

System bottlenecks

Configuration and tuning

Ledger data availability and caching

Redundant committing peer

Data caching

Fabric performance measurement and benchmarking

Summary

10. Governance, Necessary Evil of Regulated Industries Decentralization and governance

Exploring the business models

Blockchain benefits

Supply chain management

Healthcare

Finance – letter of credit

From benefits to profits

Network business model

Founder-led network

Consortium-based network

Community-based network

Hybrid models

Joint venture

New corporation

Role of governance in a business network

Business domains and processes

Membership life cycle

Funding and fees

Regulation

Education

Service life cycle

Disputes

Governance structure

Centralized governance

Strategic governance

Operational governance

Tactical governance

Decentralized governance

Governance and the IT solution

Managed on-boarding

Summary

11. Hyperledger Fabric Security Hyperledger Fabric design goals impacting security

Hyperledger Fabr

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