From 0 to 100: Permissioned blockchains with Hyperledger Fabric and Node Part 1 - Blockchain Ingo Rammer [email protected]

Ingo Rammer Co-Founder of Thinktecture AG Focus: B2B use of blockchain technologies, from code details up to ISO TC 307, Enterprise Ethereum Alliance and Hyperledger Foundation Manuel Rauber Consultant at Thinktecture AG Focus: cross-plattform frontends, .NET Core backends, technical prototyping, lead developer of .NET Chaincode layer for Fabric

Slides and Demo-Download Slides: within 24h at https://speakerdeck.com/ingorammer Code/demos: https://bit.ly/Fabric-Workshop-BTC2018 Reach us at @ingorammer - [email protected] @manuelrauber - [email protected]

• Blockchain fundamentals • Blocks, transactions, consensus, mining, smart contracts, … • Building blocks of a Fabric network • Transaction flow in Fabric • Chaincode basics – Fabric‘s smart contracts • Chaincode development end-to-end • Typical network configuration for Fabric Agenda

• Technology, not magic

Blockchain-Fundamentals with Phone Number Porting

Telco A Telco B 0151-123 123 123 John Doe 1/1/1960 0151-123 123 123 John Doe 1/1/1960 Fax, email, letter, ... SMS, email, letter, ...

Telco A Telco B 0151-123 123 123 John Doe 1/1/1960 0151-123 123 123 John Doe 1/1/1960 Fax, email, letter, ... SMS, email, letter, ... Well, for us everything seems ok. Please ask the others. ? Well, for us everything seems ok. Please ask the others.

• 3,437 registered telecom companies • 31% of all requests at regulator (19,000 cases, 3,000 escalations) • 300,000 EUR fines in 2016 Source: Yearly report 2016 of German network regulator, page 62 ff. (https://goo.gl/cPQcXV) Size of the problem (in Germany)

• Independent actors • Varying levels of trust between actors • Need for transparency (for example by trusted replica sets of data) • Without introducing central authorities Our Scenario

Blockchain Basics

"A blockchain [...] is a continuously growing list of records, called blocks, which are linked and secured using cryptography. Each block typically contains a cryptographic hash of the previous block, a timestamp and transaction data" Wikipedia, March 26, 2018 Blockchain – What is this?

Blockchain Genesis Block Block 1 Random Content Genesis Hash Content Genesis Hash Block 1 Hash Block 2 Content Block 1 Hash Block 2 Hash Block 3 Content Block 2 Hash Block 3 Hash Config

Node 1 Peer-to-Peer Replication Genesis Block Block 1 Block 2 Block 3 Node 2 Genesis Block Block 1 Block 2 Block 3 Node n Genesis Block Block 1 Block 2 Block 3 Block 4 Block 4 Block 4 Block 5 Block 5 Block 5

Node 1 Nodes are independent, without central authority Node 2 Node 3 Node 4 Node 5 Node 6 Node 7 Node 8 Node 9

Two main models of operation Public blockchains Ethereum, Bitcoin, ... Private blockchains Telco E Telco C Telco A Telco F Telco G Telco B Telco D BNA Telco X Consortiums, governments, ... ? ! Telco X

Public Blockchains • Identities of participants are unknown • Therefore: mining to secure the network's integrity (proof-of-work, Nakamoto consensus) • Typically, all data is public • Low transaction counts: <= 20 per seconds globally (Bitcoin, Ethereum)

Private Blockchains • Participants are known, access protected • Therefore: No mining necessary (proof-of-authority instead of proof-of-Work) E C A F G B D BNA X G #1 #2 #3 G #1 #2 #3 G #1 #2 #3 #4 • Transactions can be public or private (direct point-to-point exchange between two participants) • Massively higher transaction counts (hundreds, thousands or tens of thousand per second) • Technologies like Hyperledger Fabric

Blocks and Transactions

• Signed statements, which are immutable and can't be deleted ("transactions") What's in a Block? In practice: machine readable, for example as transaction records Our verified customer John Doe, born on 1/1/1911 wants to transfer his phone number 0151-123 123 123 from Telco A to us Signed: Telco B We're ok with this transfer Signed: Telco A

• Transactions are recorded in definitive sequence Properties of Transactions Block 1 Tx #1 Tx #2 Tx #3 Block 2 Tx #4 Tx #5 Block 3 Tx #6 Tx #7 Tx #8 Block 4 Tx #9 Block 5 Tx #10 ...

• Parts of transactions can be encrypted Properties of Transactions {"tx":"requestTransfer", "phone":"0151-123123123", owner: "TelcoA", encryptedCustomerData: "0xe2cbcf5f890afabc4dbd236d19f949db 05fcec2155..."} Signed: Telco B Encrypted with public key of Telco A

• Content can be hashes of external data Properties of Transactions {"tx":"requestTransfer", "phone":"0151-123123123", owner: "TelcoA", signedScannedContractHash: "0x80ebe76679b4812cde61d555c9026...", encryptedCustomerData: "..."} Signed: Telco B "I've got a PDF here (which I won't share) which has this hash" • To later prove the existance (at the time of block creation) and integrity of external data

• Data which has been transferred point-to-point can be referenced Properties of Transactions {"tx":"requestTransfer", "phone":"0151-123123123", owner: "TelcoA", externalDataHash: "0x5489b348f7a433...", } Signed: Telco B Hash-reference to a piece of data which has been sent directly • To ensure transaction privacy, only parties of the transactions will get access to its data (f.e. Fabric's private data collections)

Blockchain: replicated, immutable* sequence of transactions * Within clearly defined conditions. More about these later. Interium conclusion

Blockchains and Code

• How does the system check, whether or not a transation is valid? Validity of Transactions? We're ok with the transfer of phone number 0151-123 123 123 Signed: Telco B Telco C 0151-123 123 123 is not with Telco B, but belongs to us! • Solved by laws, contracts & penalties (post-fact) • Or by technology (pre-fact)

• Rules that define if a transaction is valid • Read and write "World State": the actual information in the blockchain Smart Contracts Number Owner 0151123123123 Telco C 01511111111111 Telco A 01511111111112 Telco Z

Node 1 Key Value 0151123123123 Telco C 01511111111111 Telco A 01511111111112 Telco Z We are ok with the transfer of 0151-123 123 123 to Telco A. Signed: Telco B function confirmTransfer(number, transferTarget) { if (owner[number] == msg.sender) { owner[number] = transferTarget; } else throw; } owner[number] == msg.sender Cryptographic verification throw Transaction flagged as invalid Failed

Node 1 Key Value 0151123123123 Telco C 01511111111111 Telco A 01511111111112 Telco Z We are ok with the transfer of 0151-123 123 123 to Telco A. Signed: Telco C function confirmTransfer(number, transferTarget) { if (owner[number] == msg.sender) { owner[number] = transferTarget; } else throw; } owner[number] == msg.sender Cryptographic verification owner[number] = transferTarget; Changes World State Key Value 0151123123123 Telco A 01511111111111 Telco A 01511111111112 Telco Z OK

All nodes need the same version of smart contracts to work correctly!

Docker-Container (managed) How are smart contracts executed? Ethereum Node Inside a node Configured Process Smart Contract Execution Environment Tendermint Node Server-Code (Interface- convention: ABCI) Contract Creation Transaction Process start & config GRPC/Socket Managed Container Hyperledger Fabric Node Chaincode (Go, JS via Go-Bridge) Socket peer chaincode install

Collisions in most classic blockchains (NB: Fabric is different!)

Node 1 17 ... 18 19 20 Node 3 17 ... 18 19 20 Node 2 17 ... 18 19 20 Node 4 17 ... 18 19 20 21a 21a 21a 21b 21b 21b 21a 21a 21b 21b

Node 1 17 ... 18 19 20 Node 3 17 ... 18 19 20 Node 2 17 ... 18 19 20 Node 4 17 ... 18 19 20 21a 21a 21b 21b 21a 21a 21b 21b

Node 1 17 ... 18 19 20 Node 3 17 ... 18 19 20 Node 2 17 ... 18 19 20 Node 4 17 ... 18 19 20 21a 21a 21b 21b 21a 21a 21b 21b 22 22 22 22 23 22 22 22 22 23 23 23

• Usually, only one node creates a new block (algorithmic selection for each block) • Especially in proof-of-work blockchains: • Collisions: Protocol-specific definition of correct chain • Number of confirmations! • In Proof-of-Authority: during network disconnect

• Smart Contracts - or rather their side effects - have to be deterministic for all relevant nodes • Communication with off-chain services: asynchronous (events) with signed answer- transaction to original requester • This concept is called "oracle" Smart Contracts & external data

Blockchain: replicated, immutable sequence of transactions, confirming to certain rules Conclusion

Blockchains are replicated databases which use decentralized code execution (smart contracts) to achieve early and shared consensus about their data (instead of later re-conciliation)

Part 2 – Hyperledger Fabric

• Hyperledger itself is not a technology, but a project of the Linux Foundation • An umbrella for blockchain technologies • For example Fabric, Sawtooth, Iroha, Indy, … • Additional tools • Cello, Explorer, Composer What is Hyperledger?

• A platform to create private, permissioned blockchains • Created mainly for B2B use • Not ICOs, public cryptocurrencies, … • Original creators and main drivers: IBM • Governance-constructs built in • The backend for IBM, Oracle, SAP, ... Blockchain offerings What is Fabric?

• Organizations • Peers & Orderer • Chaincode & State-DB (f.e. CouchDB) • Endorsement & Policies • Channels and Private Data Collections Key Concepts

A Fabric Network

Organizations: Participants in a network Telco 1 Telco 2 Regulator

Organizations: provide certs for their users Telco 1 Telco 2 Regulator Provide membership services (CAs) for peer nodes and users (MSP => Membership Service Provider)

Organizations: Can operate peers Telco 1 Telco 2 Regulator

Channel 1 Channel 2 Peers can join channels peer1.telco1.com peer1.telco2.com peer1.regulator.com

• A Fabric network consists of multiple peers • Peers can join channels • Channels are independent blockchains • Only the participants of a channel can see its data • Channels are permissioned! • Transient or permanent subsets: private data collections Channels are blockchains!

Smart Contracts and Fabric

• Can theoretically be written in any programming language which understands GRPC • SDKs available for Go, Node.js, Java; .NET in progress • Can interact (read/write) with the ledger's data • Run in separate docker container Chaincode == Smart Contracts

Chaincode Deployment peer1.telco1.com peer1.regulator.com Node.js sources Chaincode Package (name & version) Install (by admin of organization) peer chaincode package <…> peer chaincode install <…> peer chaincode install <…> numbertransfer, v1 numbertransfer, v1 Note: Packaging is optional, both admins could install from source.

Chaincode Instantiation peer1.telco1.com peer1.regulator.com numbertransfer, v1 numbertransfer, v1 channel1 peer chaincode instantiate -n numbertransfer -v v1 -C channel1 -P numbertransfer:v1

Deployment of Version 2 peer1.telco1.com peer1.regulator.com Node.js sources for v2 peer chaincode install <…> peer chaincode install <…> numbertransfer, v1 numbertransfer, v1 Note: We could have installed using a package as well. (Like before) numbertransfer, v2 numbertransfer, v2

peer1.telco1.com peer1.regulator.com numbertransfer, v1 numbertransfer, v1 numbertransfer, v2 numbertransfer, v2 Chaincode Upgrade channel1 peer chaincode upgrade -n numbertransfer -v v2 -C channel1 -P numbertransfer:v1 numbertransfer:v2

• Chaincode is packaged and explicitly installed on individual peers • Not all peers need each chaincode • Chaincode can exist in multiple versions on a peer • Chaincode is instantiated for one of more channels • Instantiation == Binding of a particular chaincode version to a channel via a specific endorsement policy • Chaincode can be upgraded for a channel (=> bound to a different existing chaincode version on the peers) Chaincode / Smart Contracts

• How is the chaincode executed? • Upon the first transaction (or instantiation for the initial node), a docker image (and container) is created and started • Can you stop/remove chaincode? • Only manually by stopping the container, removing the image and deleting the directory on the host (http://bit.ly/CC_for_ops_1_3) • Do I need to keep all versions around? • No: because of how endorsement works with Fabric • Does every node need access to the chaincode? • No: because of how endorsement works with Fabric Chaincode FAQs

Endorsement Policies numbertransfer version: v1 endorsementpolicy: AND( 'Regulator.member', OutOf( 2, 'Telco1.member', 'Telco2.member', 'Telco3.member' ) ) channel1 { chaincodeId: 'numbertransfer', fcn: 'confirmTransfer', args: ['49151123456'] } peer1.telco1.com numbertransfer, v1 peer1.telco2.com numbertransfer, v1 peer1.telco3.com numbertransfer, v1 peer1.regulator.com numbertransfer, v1 Important: Nodes outside of current organization only see public "anchor nodes" for other organizations (configured channel by channel)

numbertransfer version: v1 endorsementpolicy: AND( 'Regulator.member', OutOf( 2, 'Telco1.member', 'Telco2.member', 'Telco3.member' ) ) channel1 { chaincodeId: 'numbertransfer', fcn: 'confirmTransfer', args: ['49151123456'] } peer1.telco1.com numbertransfer, v1 peer1.telco2.com numbertransfer, v1 peer1.telco3.com numbertransfer, v1 peer1.regulator.com numbertransfer, v1 Endorsement Policies

Endorsement Policies numbertransfer version: v1 endorsementpolicy: AND( 'Regulator.member', OutOf( 2, 'Telco1.member', 'Telco2.member', 'Telco3.member' ) ) channel1 { chaincodeId: 'numbertransfer', fcn: 'confirmTransfer', args: ['49151123456'] } peer1.telco1.com numbertransfer, v1 peer1.telco2.com numbertransfer, v1 peer1.telco3.com numbertransfer, v1 peer1.regulator.com numbertransfer, v1

Endorsement Policies numbertransfer version: v1 endorsementpolicy: AND( 'Regulator.member', OutOf( 2, 'Telco1.member', 'Telco2.member', 'Telco3.member' ) ) channel1 { chaincodeId: 'numbertransfer', fcn: 'confirmTransfer', args: ['49151123456'] } peer1.telco1.com numbertransfer, v1 peer1.telco2.com numbertransfer, v1 peer1.telco3.com numbertransfer, v1 peer1.regulator.com numbertransfer, v1

• Every operation in Fabric is permissioned • https://hyperledger-fabric.readthedocs.io/en/release-1.3/policies.html • https://hyperledger-fabric.readthedocs.io/en/release-1.3/endorsement-policies.html • Configurable policies • Any, all, m-out-of, majority (for config changes) • And, Or Permissions and Policies AND ('Regulator1.Admin', OutOf(2, 'Telco1.Admin', 'Telco2.Admin', 'Telco3.Admin'))

• Essential for Fabric transaction flow • Orderers are ... • ... consensus-forming nodes • ... block creators • Orderers transfer blocks to peers; no direct peer- to-peer sync of the blockchain Orderers

Fabric Transaction Flow

• Proposal, Endorsement & Simulation • Ordering & distribution • Ledger updates Three Phases

Proposal & Endorsement - Client's View { chaincodeId: 'numbertransfer', fcn: 'confirmTransfer', args: ['49123123123', 'Telco2'] } peer1.telco1.com numbertransfer, v1 peer1.telco2.com numbertransfer, v1 peer1.telco3.com numbertransfer, v1 peer1.regulator.com numbertransfer, v1 2) Determine policy (Static or discovery) 3) Select endorsers (peer URLs) peer1.telco2.com numbertransfer, v1 peer1.telco3.com numbertransfer, v1 peer1.regulator.com numbertransfer, v1 4) Send proposal directly to endorsers 5) Endorsers simulate transactions 6) Collect endorsements and verify 1) Create and sign proposal

peer1.telco2.com Simulation & Endorsement - Peer's View Key Value Version 49123123123 Telco1 B1/Tx0 491111111111 Telco2 B23/Tx1 491111111112 Telco3 B4/Tx0 { chaincodeId: 'numbertransfer', fcn: 'confirmTransfer', args: ['49123123123', 'Telco2'] } Signed: Telco1 // still simplified pseudocode! function confirmTransfer(number, transferTarget) { if (ctx.clientIdentity.mspId == await getState(number)) { await putState (number, transferTarget); } else throw; } // still simplified pseudocode! function confirmTransfer(number, transferTarget) { if (ctx.clientIdentity.mspId == await getState(number)) { await putState (number, transferTarget); } else throw; } // still simplified pseudocode! function confirmTransfer(number, transferTarget) { if (ctx.clientIdentity.mspId == await getState(number)) { await putState (number, transferTarget); } else throw; } Update state Verification of rules

peer1.telco2.com Simulation & Endorsement - Peer's View Key Value Version 49123123123 Telco1 B9/Tx0 491111111111 Telco2 B23/Tx1 491111111112 Telco3 B4/Tx0 { chaincodeId: 'numbertransfer', fcn: 'confirmTransfer', args: ['49123123123', 'Telco2'] } Signed: Telco1 // still simplified pseudocode! function confirmTransfer(number, transferTarget) { if (ctx.clientIdentity.mspId == await getState(number)) { await putState (number, transferTarget); } else throw; } // still simplified pseudocode! function confirmTransfer(number, transferTarget) { if (ctx.clientIdentity.mspId == await getState(number)) { await putState (number, transferTarget); } else throw; } // still simplified pseudocode! function confirmTransfer(number, transferTarget) { if (ctx.clientIdentity.mspId == await getState(number)) { await putState (number, transferTarget); } else throw; } // still simplified pseudocode! function confirmTransfer(number, transferTarget) { if (ctx.clientIdentity.mspId == await getState(number)) { await putState (number, transferTarget); } else throw; } // still simplified pseudocode! function confirmTransfer(number, transferTarget) { if (ctx.clientIdentity.mspId == await getState(number)) { await putState (number, transferTarget); } else throw; } Endorsement Read Set Write Set Read Set Key: '49123123123': Version: {Block: 9, Transaction: 0} Write Set Key: '49123123123': New Value: 'Telco2' Signed: peer1.telco2.com

• Transactions are processed on a client-selected subset of peers • Policy is defined during instantiation or upgrade of a chaincode • “Regulator AND two of Telco A, Telco B, or Telco B“ • Endorsers sign off on transactions after chaincode simulation (no ledger changes, only simulation!) Endorsement

Transaction Request Collecting all endorsements on the client Proposal { chaincodeId: 'numbertransfer', fcn: 'confirmTransfer', args: ['49123123123', 'Telco2'] } Read Set Key: '49123123123': Version: {Block: 9, Transaction: 0} Write Set Key: '49123123123': New Value: 'Telco2' Signed: peer1.telco1.com, creator Signed: peer1.telco2.com, endorser Signed: peer1.telco3.com, endorser Signed: peer1.regulator.com, endorser

Orderer Ordering, distribution and incorporation Transaction Message Proposal Read Set Write Set peer1.telco1.com peer1.telco2.com peer1.telco3.com peer1.regulator.com channel1 channel2 channel1 channel1 channel1 channel1 2) Orderers forms consensus and create a new block 3) New block is distributed to peers 4) Peers check that block comes from valid orderer 5) Peers add the block to their chains and process transactions 1) Client sends TX message to one orderer

• Responsibility of orderers: • Form consensus about the sequence of transactions • Create blocks consisting of individual transactions • Distribute the resulting blocks • NOT: check if transactions are valid/endorsed! • Today, there are two completed consensus options: "Solo" and "Kafka" • CFT (etcd/raft) and BFT are work in progress Orderers create blocks

peer1.telco2.com Transaction handling at peers - Scenario: block #71 Key Value Version 49123123123 Telco1 B9/Tx0 491111111111 Telco2 B23/Tx1 491111111112 Telco3 B4/Tx0 Endorsement Read Set Key: '49123123123': Version: {Block: 9, Transaction: 0} Write Set Key: '49123123123': New Value: 'Telco2' 2) Verify endorsement, else flag as ENDORSEMENT_POLICY_FAILURE and stop 3) Compare the read-sets, else flag as MVCC_READ_CONFLICT and stop 4) Update state (and version!) and flag as VALID 1) Take each transaction from the block IMPORTANT: No chaincode execution at this stage! Key Value Version 49123123123 Telco2 B71/Tx0 491111111111 Telco2 B23/Tx1 491111111112 Telco3 B4/Tx0

• Client uses SDK to create a proposal and send it to endorsers • Endorsers simulate chaincode execution; sign read-set and write-set • Client uses SDK to verify endorsement (optional) • Client sends transaction (proposal + endorsement) to orderer • Orderers create a block (for one channel) and broadcast to peers • Peer verifies endorsement and read-set against its copy of the ledger • If ok, the peer incorporates the write-set in its copy of the ledger • Erroneous transactions remain in the blockchain but will be flagged Complete Fabric Transaction Flow

Let's look at this in context & code

• Organizations: Regulator, Telco1, Telco2, Telco3 • Each with one peer and a CouchDB state database • One orderer (Solo) • In Docker: also CLI nodes for each org, which contain tools Our Demo Network

• https://github.com/hyperledger/fabric-chaincode-node • New API: https://www.npmjs.com/package/fabric-contract- api • Currently doc bug: "startchaincode" vs "chaincodestart" in package.json Chaincode with Node.js

• Tip: use a single-peer endorsement policy • Start peer with --peer-chaincodedev=true • Start chaincode to connect to peer: Debugging Chaincode export CORE_CHAINCODE_ID_NAME=simplecontract:v0 # : node node_modules/fabric-shim/bin/chaincodestart --peer.address grpc://localhost:7052

• Install – physical deployment to a peer • Instantiate – logical binding to a channel; specifies endorsement policies and private data collections • Invoke – send a TX to chaincode (Docker container started on demand!) • Query – retrieve read-only data • Upgrade – binding of a different chaincode to a channel (incl. new policies) Chaincode Lifecycle

Fabric Network Setup

• http://hyperledger-fabric.readthedocs.io/en/latest/install.html • https://github.com/hyperledger/fabric-samples • Deployment: typically as Docker images to start containers for peers and chaincode Installing Fabric

• In Docker image hyperledger/fabric-tools • cryptogen – generate certificates if not using a CA • configtxgen – create configuration transactions • configtxlater – translator between different config representations Base Fabric tools

Please note: The step numbers on the following slides refer to the scripts/node sources in the demo download

• Create an initial network with DemoOrg1 and DemoOrg2 and one application channel (#001 to #004) • Deploy and instantiate chaincode #005 to #007 (#006 is optional for debugging) • Interact with chaincode (in ./nodejs): #008 to #011 • Examine chaincode events #100/#101 (in ./nodejs) • Query peers and discovery #102/#103 Initial Scenario Overview

• Cryptogen reads cryptoconfig.yaml • Creates root CAs (for each organization), private keys and certificates for peers, Admins and users • Output in ./crypto-config • Important: in real life, each organization would generate its part independently and only share the public certificate, but not the private keys Step 001 – Generate base cryptographic material

• Configtxgen reads different profiles in configtx.yaml (in demo download) • Generates genesis block for network itself • Generates genesis block for demochannel • Generates anchor peer update for DemoOrg1 • Generates anchor peer update for DemoOrg2 Step 002 – Create transactions for initial network

• Docker containers are started using the configuration in docker- compose.yaml • The CORE_* environment variables in docker-compose.yaml refer to entries in core.yaml • CORE_PEER_LOCALMSPID for example overrides core.peer.localMspId • FABRIC_CFG_PATH is set to /etc/hyperledger/fabric in the docker images. This directory contains core.yaml. • Important: if you want to debug chaincode, you should configure one of the peers to start with --peer-chaincodedev Step 003 – Start containers

• Wait 5-10 seconds after starting the containers to allow the nodes to fully start up before running 004! • In #004, the transactions from #002 are sent to the network (using docker –exec on the fabric-tools nodes) • A channel is created, both DemoOrg1 and DemoOrg2 join the channel and Step 004 – Create Channels

• Chaincode is installed on either one node only, or also on a second node • peer chaincode install is executed in the cli container (based on the image fabric-tools) • If you want to debug your code, you can use 006 to start the chaincode process Steps 005 and 006 – Installing Chaincode

• Chaincode is instantiated for the channel 'demochannel' • Depending on the script you choose at this step, the endorsement policy will be one of: • DemoOrg1 • DemoOrg1 AND DemoOrg2 Step 007 – Instantiating Chaincode

• In steps 008 to 011 (in ./nodejs), you will see different ways to interact with the chaincode • With or without discovery • With or without waiting for TX completion • Finally with a "nicer" code structure Steps 008 to 011 – Interact with Chaincode

• 200-208 (203 & 208 are node.js): Adding a member to the network • Generate cryptographic assets, start containers • Pull current config block (genesis or latest config update) • Create a "target" configuration and use configtxlator to calculate difference update from current config • Have majority of existing member sign the config update • Submit it to the orderer Additional scripts for your networks

• 300-303: upgrade and downgrade channel chaincode versions • Including change of endorsement policy • Documentation (architecture overview) states that multiple signatures can be required for chaincode instantiation; this is however not yet implemented Additional scripts for your networks

• Blockchain fundamentals • Blocks, transactions, consensus, mining, smart contracts, … • Building blocks of a Fabric network • Transaction flow in Fabric • Chaincode basics – Fabric‘s smart contracts • Chaincode development end-to-end • Typical network configuration for Fabric What have we seen today?

Slides and Demo-Download Slides: within 24h at https://speakerdeck.com/ingorammer Code/demos: https://bit.ly/Fabric-Workshop-BTC2018 Reach us at @ingorammer - [email protected] @manuelrauber - [email protected]

EXTRA CONTENT

a) Do you have independent participants? • No central authority? • No asymmetric power concentration? • Is everyone participating voluntarily? b) Do you need transparent and immutable shared data? c) Do you need trusted shared code execution? Can blockchains support my use case?

Your business model should be decentralized to use decentralized technology. If your business model is a database, use a database. Put an API in front. It's much simpler.

Three main classes of use cases for blockchains

Documenting Collaborating Transforming • „Timestamping“ • Put a hash of your private documents or data on a blockchain • Technical proof of integrity and existence of documents and data at a certain point in time • Relatively easy to implement, quick ROI • No – or only small – focus on smart contracts

Documenting Collaborating Transforming • Data exchange and process transparency • States of processes managed via blockchain • Digitization of paper processes between companies • Phone number porting • „Loi Hamon“ in France

Documenting Collaborating Transforming • Create new business opportunities and markets • Reality check: Increased complexity due to the number of stakeholders

• Problem with car insurance • Risk assessment (and policy pricing) based on number of years of accident-free car ownership • But what about car sharing users? (2M+ users in Germany) • Challenges • GDPR-conforming data processing • Scaling to lots of parties on all sides (no point-to-point interfaces) • Data should survive bankruptcy of a party (no on-demand generation) Case: Accident-free carsharing kms per year

Customer generates digital ID (in browser or on a membership card, …) Carsharing provider • Connect digital ID with provider's customer ID • Opt-in on web site Insurer Blockchain May 2018 Cust 1122 – 97 km May 2018 Cust 5745 – 34 km June 2018 Cust 1122 – 535 km June 2018 Cust 5745 – 16 km Customer Periodic publication of data

Carsharing provider Insurer Blockchain 239587030 4957443873 459089845 3458999… 947989834 5345534524 958458205 755345… 9447757234 2349348572 345580923 84949283… 209389084 923840982 342394820 9348934… Customer Publication of signed data, encrypted with the public key of each customer Customer can decrypt her data at any time. Nobody else can. May 2018 Cust 1122 – 97 km - Provider1 June 2018 Cust 1122 – 535 km - Provider1 Customer can pass data to third parties after decryption. Even if the creator of the data does not exist anymore. (Ultimate data sovereignty)

Carsharing provider #1 Insurer 1 Blockchain Customer Carsharing provider #2 Rental car provider Insurer 2 Insurer 3 0304... 4586... 6436... 9384... 5463... 5854... … Feb 2018, 50 km, Stadt- mobil Feb 2018, 25 km, DB March 2018, 1534 km, Sixt Transfer by customer!

How do transactions get into the blocks in other blockchain platforms like Ethereum?

Node 1 – Max Block: 20 Node 1 – Max Block: 21 Node 2 – Max Block: 20 Key Value 0151123123123 Telco C 01511111111111 Telco A 01511111111112 Telco Z Node 3 – Max Block: 20 Key Value 0151123123123 Telco C 01511111111111 Telco A 01511111111112 Telco Z Block 21 (in progress) Tx #78 Tx #79 Key Value 0151123123123 Telco C 01511111111111 Telco A 01511111111112 Telco Z Pending Transactions (Mempool, p2p Sync) Tx X Tx Y Tx Y Tx Z Tx Z Tx X Tx X Tx Z Tx Y Smart contract execution for #78 Failed! Smart contract execution for #79 Block hash Key Value 0151123123123 Telco A 01511111111111 Telco A 01511111111112 Telco Z Block closed

Node 1 – Max Block: 20 Node 1 – Max Block: 21 Node 2 – Max Block: 20 Key Value 0151123123123 Telco C 01511111111111 Telco A 01511111111112 Telco Z Node 3 – Max Block: 20 Key Value 0151123123123 Telco C 01511111111111 Telco A 01511111111112 Telco Z Key Value 0151123123123 Telco A 01511111111111 Telco A 01511111111112 Telco Z Pending Transactions (Mempool, p2p Sync) Tx Z Block 21 Block 21 Block 21 Block 21 Tx #78 Tx #79 Failed! Block hash Block 21 Block 21 Block 21 Block 21 Tx #78 Tx #79 Failed! Block hash Block 21 Block 21 Block 21 Block 21 Tx #78 Tx #79 Failed! Block hash

Node 1 – Max Block: 20 Node 1 – Max Block: 21 Node 2 – Max Block: 21 Key Value 0151123123123 Telco A 01511111111111 Telco A 01511111111112 Telco Z Node 3 – Max Block: 21 Key Value 0151123123123 Telco A 01511111111111 Telco A 01511111111112 Telco Z Key Value 0151123123123 Telco A 01511111111111 Telco A 01511111111112 Telco Z Pending Transactions (Mempool, p2p Sync) Tx Z Block 21 Block 21 Block 21 Block 21 Tx #78 Tx #79 Failed! Block hash Block 21 Block 21 Block 21 Block 21 Tx #78 Tx #79 Failed! Block hash Block 21 Block 21 Block 21 Block 21 Tx #78 Tx #79 Failed! Block hash

Block Creator

• Who creates the next block? (Or: "who could rewrite the history of the chain?) • Crypto-economic techniques • Proof-of-Work: Crypto riddle (power consumption!) • Proof-of-Stake: Monetary penalties • Proof-of-Authority: Contractual agreements Selecting a node to create blocks

Where are the clients?

AWS for Telco B DC Telco Z Azure Azure (VM Telco C) DC Telco A Client (Telco A) Client (Telco X) Client (Telco Y) Client (Telco Z) Node 1 Node 2 Node 3 (Telco A) Node 4 Node 5 Node 6 (Telco B) Node 7 (Telco C) Client (Telco B) DC Telco C Client (Telco C) Client – has private key Node is part of BC Connection to trusted node (grpc/grpcs, ...)

Thank you! • Slides: https://speakerdeck.com/ingorammer • Contact: [email protected] • Twitter: @ingorammer