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Hyperledger Fabric offers path to enterprise blockchain future

Blockchain arose from bitcoin, but it's looking to find a place in the enterprise. Frameworks like Hyperledger Fabric could smooth out the technology's rough side for business uses.

Blockchain technology isn't on quite the same roller coaster ride as bitcoin, the cryptocurrency upon whose back it first emerged. Yes, it has surely had its share of excitement -- but under the auspices of frameworks such as Hyperledger Fabric, the time may have come for enterprise blockchain deployments.

Established players and startups alike now work zealously to exploit these new techniques for distributing transactions and data. Like the bitcoin network, blockchain has potential to change the way transactions are executed and the way data is handled.

Business-to-business applications could be the first domain to see blockchain incursions. Such processes lend themselves to "being reimagined on the blockchain," according to Jerry Cuomo, vice president for blockchain technologies within IBM's Cloud group.

A lot of change is needed before that reimagination comes to fruition. But technologists like Cuomo can cite the possible benefits of a future with enterprise blockchain technology.

"Today, everyone keeps a copy of their own books," he said. "When there is a multiparty transaction that goes wrong, there needs to be reconciliation."

IBM executive Jerry CuomoJerry Cuomo

Such reconciliation is one of the more labor-intensive and time-consuming parts of commerce. Arguments about what one or the other's spreadsheet says are common.

"With blockchain, everyone is using the same database," Cuomo said.

In fact, everyone is, in effect, using the same ledger, albeit a distributed one.

A different kind of processing

The blockchain underlying bitcoin creates a peer-to-peer network in which interconnected blocks of data are encrypted with identifying hash codes. Users can remain anonymous, but all participants have visibility into the contents of blocks stored on the network.

The approach is quite different from those in today's corporate systems, where transactions are committed to relational databases. With blockchain, in Cuomo's words, "there is no single database. Instead, everyone has a copy of the transaction that is replicated and synchronized."

One of the big centers of attention for enterprise blockchain hopes has been the Hyperledger standards group, a Linux Foundation undertaking that seeks to promote cross-industry blockchain technologies, and to tame some of the rougher aspects of basic bitcoin.

Prominent industry players like IBM, Oracle, Microsoft and SAP are among the members of the Hyperledger group.

Among the group's efforts is Hyperledger Fabric, a hosted framework for developing blockchain applications. Basic elements of the architecture require the network participants to propose transactions that are ordered, validated and -- based on consensus -- committed, or executed.

Blockchain from farm to table?

Business-to-business transactions within a supply chain are a possible use case for blockchain, according to Linda Mallers, CEO and president of FarmLogix, which has built a software platform to connect farms with food buyers. Such a supply chain bears some resemblance to a blockchain.

In the FarmLogix system, attributes are being added all along a transactional chain. ''It's dynamic code creation," Mallers said. "So, in that way, it is similar to blockchain.''

Meanwhile, she added, the need for record keeping in the food chain is becoming more and more acute.

FarmLogix CEO Linda MallersLinda Mallers

"As far as blockchain is concerned for our industry, food safety is very important, and there I would think you would see a lot of applications -- even going all the way back to when a seed is planted," Mallers said.

However, the anonymous cryptocurrency aspect that marks bitcoin-style blockchain networks is a nonstarter for FarmLogix.

In a food safety modernization application, blockchain could be a very effective tool, Mallers said.

"But we want to know where everything is and give people access to that information," she said. "For us, blockchain would not be about anonymity -- it has to be about transparency."

Accountability needed on blockchain

In fact, accountability is among the differences the Hyperledger group is looking to bring to enterprise blockchain. Visibility and consensus are keys to bringing blockchain to market for business uses, Cuomo said.

"One of the things missing from the bitcoin blockchain is accountability," he said. "In a B2B blockchain network, anonymous doesn't fly."

As a result, Hyperledger Fabric is building a permissioned network architecture that credentialed users can access in different, definable ways.

For us, blockchain would not be about anonymity -- it has to be about transparency.
Linda MallersCEO and president, FarmLogix

Another issue to confront in bringing blockchain to B2B is scalability and latency. Bitcoin transaction throughput can be lacking at times, according to Cuomo.

"We have to assure that ledger transactions are resolved in near real time," he said. "When a transaction comes into a system, it's committed to the data store. In blockchain, everyone has their own copy; when it comes into the network, it's subject to a proposal-consensus stage. If the rules are met, the transaction is committed."

There's work to be done to make these kinds of transactions scalable for real-time enterprise operations. For example, Cuomo pointed to a recent paper from IBM scientists who are working on the Hyperledger Fabric technology. The scientists tested a Hyperledger Fabric application that ran at 3,500 transactions per second with sub-second latency.

Gartner analyst Nick HeudeckerNick Heudecker

Like many other new technologies, enterprise blockchain comes with a caveat: Work done now could well need to be reworked down the road.

"The key thing is, it's early. In 18 months, you'll throw out what you've done and replace it," Gartner analyst Nick Heudecker said. Moreover, he added, blockchain technology is unlikely to displace established methods any time soon. "Most of it will be additive," he said.

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