DEFINITION of 'Hyperledger Fabric'

Hyperledger Fabric is a modular blockchain framework which acts as a foundation for developing blockchain-based products, solutions and applications using plug-and-play components that are aimed for use within the private enterprises.

BREAKING DOWN 'Hyperledger Fabric'

Hyperledger Fabric was initiated by Digital Asset and IBM, and has now emerged as a collaborative cross-industry venture which is currently hosted by the Linux Foundation. Among the several Hyperledger projects, Fabric was the first one to exit the “Incubation” stage and achieve the “Active” stage in March 2017.

Traditional blockchain networks can’t support private transactions and confidential contracts that are key for businesses. Hyperledger Fabric was thus designed to be a modular, scalable and secure foundation for offering industrial blockchain solutions.

Hyperledger Fabric is defined as the open source engine for business blockchain, and takes care of the most important features for evaluating and using blockchain for business use cases. They are discussed as follows.

Within private industrial networks, the verifiable identity of a participant is a primary requirement. Hyperledger Fabric supports permissioned memberships, which requires all network participants to have known identities. Many business sectors, like healthcare and finance, are bound by data protection regulations that mandate maintaining data about the various participants and their respective access to various data points. Fabric supports such permission-based membership.

The modular architecture of Hyperledger Fabric separates the transaction processing workflow into three different stages – smart contracts called chaincode that comprise the distributed logic processing and agreement of the system, transaction ordering, and transaction validation and commitment. This segregation offers multiple benefits – reduced number of trust levels and verification that keeps the network and processing clutter-free, improved network scalability, and better overall performance.

Additionally, Hyperledger Fabric’s support for plug-and-play for various components allows easy reuse of existing features and readymade integration of various modules. For instance, if a function already exists that verifies the participant’s identity, a enterprise level network simply needs to plug and reuse this existing module instead of building the same function anew.

The participants on the network have three distinct roles – endorser, committer and consenter. In a nutshell, the transaction proposal is submitted to the endorser peer, based on the predefined endorsement policy about the number of endorsers required. After sufficient endorsements by the endorser(s), a batch or block of transactions is delivered to the committer(s). Committers validate that the endorsement policy was adhered to, and that there are no conflicting transactions. Once the both the checks are made, the transactions are committed to the ledger.

Image Courtesy: IBM

Since only confirming instructions like signatures and read/write set are sent across the network, the scalability and performance of the network is enhanced. Only endorsers and committers have access to the transaction, and security is improved with a fewer number of participants having access to key data points.

The manufacturer wants to ship the chocolates to a specific market at a specific price but does not want to reveal that price in other markets.

Since the movement of the product may involve other parties, like customs, a shipping company, and a financing bank, it is possible that the private price is reveled to all such involved parties if standard blockchain is used to support such transactions.

Hyperledger Fabric addresses this issue by keeping private transactions truly private on the network, and only participants who need to know are aware of the necessary details. Such data partitioning on the blockchain allows the specific data points to be accessible only to the parties who need to know.

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