Create Permissioned Blockchain

How to Create Permissioned Blockchain?

These days, sending money or sharing information online without a mediator like a bank is not just a dream—it's possible thanks to blockchain. This technology is getting more popular every day because it's a safe, open book where everyone can see what's written, but no one can erase it. Although some people are still trying to wrap their heads around it and worry about how safe it is, more and more people are getting excited about what blockchain can do.

Imagine a giant vault where all kinds of valuable stuff can be stored and moved around. Now, what if only certain people with special keys could get in? That's what a permissioned blockchain is like. It's perfect for businesses that want the excellent parts of blockchain but also want to keep things under wraps and safe.

This article is like a treasure map. It will show you how to set up your private vault—this special kind of blockchain. Whether you're the boss of a company looking to keep your info safe or someone who likes building new and secure ways for people to share stuff online, you'll find out how to do it here. Let's start building!

What is Permissioned Blockchain? ?

A permissioned blockchain is a kind of blockchain network where access is restricted to specific users. Unlike public blockchains like Bitcoin or Ethereum, where anyone can participate in the consensus process (validating transactions and mining new blocks), permissioned blockchains control who is allowed to participate and, in many cases, who can view the blockchain data.

Here are some key characteristics of permissioned blockchains:

Selective Participation: The network administrators grant nodes permission to enter the network and participate in the consensus process. This can help organizations ensure that only parties who meet certain criteria, such as being a consortium member or having specific credentials, can be a node.

Identity: Participants in a permissioned blockchain have known identities, unlike in permissionless blockchains, where participants can remain anonymous or pseudonymous.

Privacy and Confidentiality: Because permissioned blockchains restrict who can access the network, they can offer greater privacy and confidentiality for transactions. This is particularly appealing to enterprises that need to protect business-sensitive data.

Performance and Scalability: With fewer nodes typically involved in the consensus process and less computational power required (as there's often no need for mechanisms like proof of work), permissioned blockchains can provide higher transaction throughput and scalability compared to their permissionless counterparts.

Governance: Permissioned blockchains have a defined governance structure that dictates how the blockchain rules can be changed, how transactions are verified, and how participants are managed.

Examples of permissioned blockchain platforms include Hyperledger Fabric (hosted by the Linux Foundation), R3 Corda, and Quorum (originally developed by J.P. Morgan). Permissioned blockchains are often used in business-to-business (B2B) applications, supply chain management, healthcare, finance, and any other sector where the advantages of blockchain technology are desired, but the open nature of public blockchains is not suitable, often due to regulatory, security, or privacy concerns.

Difference between private and permissioned blockchain?

The terms "private" and "permissioned" blockchain are often used interchangeably, but they have nuances that distinguish one from the other:

Private Blockchain:

A private blockchain is a type of blockchain where access to the network is restricted to a single organization or entity. It's like having a personal diary only you can write in or read. This single entity controls who can participate in the network, conduct transactions, mine blocks, and serve as nodes. They are typically used within an organization where privacy and control over the network are crucial.

Permissioned Blockchain:

A permissioned blockchain, on the other hand, can be accessed only by individuals who have been given explicit permission to participate. This doesn't mean that it's controlled by a single organization. Various organizations can participate in a permissioned blockchain network, and the level of access can differ from one participant to another. In this system, there are rules about what kind of transactions they can carry out and who can join the network.

Key Differences:

Control and Access:

  • Private Blockchain: Usually controlled by one organization. It's a closed network.
  • Permissioned Blockchain: This can be controlled by multiple organizations, with specific roles and permissions for each participant.
  • Use Case:

  • Private Blockchain: Typically used internally by businesses for tasks like record-keeping and auditing, away from public scrutiny.
  • Permissioned Blockchain: This could be used by a consortium of businesses that require secure, shared access with detailed permissions.
  • Transparency:

  • Private Blockchain: Transparency can be limited to a single organization. Less transparent to outside parties.
  • Permissioned Blockchain:More transparent to the approved users, but still not open to the general public.
  • Decentralization:

  • Private Blockchain: Generally more centralized since control rests with one entity.
  • Permissioned Blockchain:This can be more decentralized as multiple organizations can manage the network.
  • In summary, while both private and permissioned blockchains restrict access compared to public blockchains, a private blockchain is typically the domain of a single entity. In contrast, a permissioned blockchain can have a broader membership base with varying levels of access rights.

    How to Create a Permissioned Blockchain Network? Step-by-Step Guide

    Creating a permissioned blockchain requires a solid understanding of both blockchain technology and network security. Permissioned blockchains are different from public blockchains like Bitcoin or Ethereum because they restrict who is allowed to participate in the network, maintain the shared ledger and execute the consensus protocol. For this guide, I'll use Hyperledger Fabric, which is a popular open-source framework for developing permissioned blockchains. Hyperledger Fabric is designed for enterprise use, providing a lot of flexibility and control over transactions and network participants.

    Step 1: Understand the Basics of Blockchain

    Before getting into the technical details, it's important to understand the basic concepts of blockchain, such as:

  • Decentralization
  • Immutability
  • Smart Contracts (Chaincode in Hyperledger Fabric)
  • Consensus Mechanisms
  • Permissioned vs. Permissionless Blockchains
  • Step 2: Prerequisites

    Make sure you have the following prerequisites installed:

  • Docker and Docker Compose (for creating and managing the blockchain network components)
  • Git (for cloning repositories)
  • Node.js and npm (for running and managing the network applications)
  • Go programming language (if you plan to write chain code in Go)
  • Python (for specific scripts that might be used)
  • Step 3: Set Up Hyperledger Fabric

    Install Hyperledger Fabric Samples, Binaries, and Docker Images:

  • Clone the Hyperledger Fabric samples repository from GitHub:
  • bashCopy code
  • git clone https://github.com/hyperledger/fabric-samples.git
  • Navigate to the fabric-samples directory:
  • bashCopy code
  • cd fabric-samples
  • Run the script to download binaries and docker images:
  • arduinoCopy code
  • curl -sSL https://bit.ly/2ysbOFE | bash -s
  • Understand the Network Structure:

  • Hyperledger Fabric networks are comprised of Peers (nodes), Orderers (transaction sequencing), Certificate Authorities (identity management), and a Membership Service Provider (MSP).
  • Setting Up the Network:

  • Use a sample network configuration available in the fabric samples to start. Navigate to a test network directory:
  • bashCopy code
  • cd test-network
  • Bring up the network:
  • bashCopy code
  • ./network.sh up
  • Step 4: Create Your Own Network

    Define Your Network Configuration:

    Create configuration files that define your network, including:

  • MSP configurations
  • Orderer genesis block
  • Channel configuration
  • Anchor peers
  • Generate the Crypto Material:

  • Use the crypto gen tool to generate the cryptographic material (keys and certificates) for your network entities (organizations, peers, etc.).
  • Start the Network:

  • Use docker-compose files with the configurations and crypto material to start the network components.
  • Step 5: Define and Implement Chaincode

    Write the Chaincode:

  • Write the business logic that you want to execute on your blockchain. This can be in Go, Java, or Node.js for Hyperledger Fabric.
  • Install the Chaincode:

  • Use the peer CLI commands to install your chaincode on the peers.
  • Instantiate the Chaincode:

  • Instantiate the chain code on the channel, setting any necessary arguments and endorsement policies.
  • Step 6: Interacting with the Blockchain

    Create and Join Channels:

  • Channels are private "subnets" of communication between two or more specific network members for conducting private and confidential transactions.
  • Set Up the CLI or Applications:

  • Use the Fabric SDKs in languages like Node.js and Java or Go to interact with the blockchain network from your applications.
  • Invoke and Query the Chaincode:

  • Use the CLI or SDK to invoke chaincode functions, which will execute transactions on the blockchain.
  • Query the chain code to retrieve data from the blockchain.
  • Step 7: Managing the Blockchain

    Monitoring:

  • Set up monitoring tools like Hyperledger Explorer to visualize the blockchain network and its activities.
  • Adding or Removing Participants:

  • Use the CA to manage participant identities and permissions.
  • Updating the Chaincode:

  • You'll need to update or upgrade the chain code as your network evolves.
  • Scaling the Network:

  • Add more peers, orderers, or entire organizations to scale your network.
  • Step 8: Maintaining Network Security

    Enforce Rigorous Access Controls:

  • Regularly review and update access controls to ensure only authorized users can access network functions.
  • Regularly Update Dependencies:

  • Keep all components and dependencies up to date with the latest security patches.
  • Conduct Security Audits:

  • Regularly perform comprehensive security audits of your network.
  • Scale your Blockchain projects with us

    How Rejolut Can Help You to Develop Permissioned Blockchain

    In the quest to create a permissioned blockchain, enterprises often need expert guidance to navigate the intricate process. This is where a blockchain app development company like Rejolut can become an invaluable partner. Specializing in crafting secure and efficient digital solutions, Rejolut leverages its technical expertise to build permissioned blockchain systems that meet specific business needs. They ensure selective access control, maintain user identity confidentiality, and optimize for performance and scalability – all crucial features for enterprises seeking to benefit from blockchain's potential while safeguarding sensitive information.

    Rejolut's role extends beyond the initial development phase, providing ongoing support to manage the blockchain effectively. Their team assists in implementing rigorous access controls, updating smart contracts, and conducting security audits to keep the network robust against evolving threats. By choosing a seasoned blockchain app development company like Rejolut, businesses can confidently build a permissioned blockchain ecosystem that is secure, compliant, and tailored to their unique operational demands.

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