Written by Shivashish Yadav on   -  10 min read

What are DLT and Hyperledger? And how does it work in blockchain?

Distribute Ledger Technology (DLT) Overview

Blockchain is one of today's big talking points. Experts see a technology that will influence our life, a new phase of the internet. But what is the belief based on?

Blockchain is momentarily the best-known Distributed Ledger Technology, or in short, DLT. This is primarily because of the hype surrounding the Bitcoin cryptocurrency, which is based on Blockchain technology. DLTs describe digital databases in which every member can supplement the data stored there not centrally in a cloud, but locally on each computer on the network, functioning as a decentral peer-to-peer network.

The decentral consensus mechanisms are implemented through algorithms on the taking part computers. This so-called mining verifies the data in the decentral network–makes DLTs transparent, safe, and decentral, and by that the backbone for future transactions and verification processes. With Blockchain, we write a new digital block with a distinctive signature containing the hash value of the preceding block for every new set of information. The members check the new information using a consensus protocol before it is in-corporate as a block within the chain and becomes immutable from then on.

** Proof-of-work, ** which is the best-known consensus mechanism, use the computing capacity of the members to validate the transactions. This form of mining is very resource-intensive because of the laborious computing caused by complex calculations. However, this effort is part of the secure consensus protocol's design and protects the network from being manipulated as it renders attacks uneconomic.

There are more flexible ways to secure the consensus, such as ** proof of stake ,** for use cases where the safety requirements are not as high. In proof of stake, users with more tokens have more power in the consensus-finding process. This happens with the assumption that the user has no interest in damaging his token value and his influence by harming this system. If one has significantly higher speed requirements, then one can use DLT for framework contracts and perform the exchange of information by a so-called second later mechanism.

In this second layer, transactions are processed at higher rates. An alternative approach for uses cases with higher transaction rate requirements could make use of the DLT variant Directed Acyclic Graph (DAG). In contrast to the Blockchain , consensus finding in DAGs is achieved if the user validates, for each new transaction, at least two previously not validated transactions.

With every user taking part in the network, the transaction rate is increased–at least in theory. However, this advantage of scalability is at a research stage and is not yet completely proven in practice.

Distributed ledger technologies are highly relevant in the future because they enable an economy of things. Safe transactions between humans and machines, immutable, indisputable information–and as a result, the capability for smart contracts, embedded in a program code to guarantee decentral automated contractual transactions. Intermediaries will become redundant, businesses will be decentralized – and ultimately be performed between machine and machine. Cars charge themselves, negotiate the prices at the charging station–and settle the bill. In an Economy of Things, Distributed Ledger Technologies create and ensure the basis for trust, fairness, and participation in the decision-making process. As a result, DLT enables intersectoral value-creating networks.

Hyperledger Overview

Before I tell you what Hyperledger is, let me tell you what Hyperledger isn't because it's really easy to get confused in today's world with so many Blockchain platforms.

Hyperledger is not a cryptocurrency that so many people seem to be interested in today's world. Hyperledger is not a Blockchain and neither is it a company, so what exactly is Hyperledger?

Well, to begin with, the Hyperledger is a project under the Linux Foundation. So like others projects under the Linux Foundation, for example, NodeJS are joined drone code and Many more, the Hyperledger is also an open-source development project. Where people from all over the planet can come and help Hyperledger or get developed as software and as a platform.

According to the *executive director of Hyperledger, brian. Hyper ledger is an open-source community of communities to benefit an ecosystem of Hyperledger -based solution providers and users focused on Blockchain -related Use cases that will work across a variety of industrial sectors.

So what exactly Hyperledger mean?

well, in simpler terms in analogies, Hyperledger can be thought of as software that enables developers all across the globe to develop Blockchain -based solutions for their particular businesses. Some of you who are slightly versed with Blockchain technology might think that

Hey, we have platforms like Ethereum. Why can't they do what Hyperledger does.? Well, the ethos of the Hyperledger is that it believes every business or industry is unique in its own ways. An application standing for that service must be personalized., Unlike the Ethereum Blockchain, which runs on a very generalized protocol for everything that runs on its network.

You will see what I mean in a short

While now, let me give you a brief history of Hyperledger before drilling deeper into its mechanics. So first Hyperledger began as a small project with a limited number of developers who came from various sectors like finance supply and data management.

All these people had one common goal in mind and that is to make the Blockchain as technology was accessible to the world, so with these things in mind developers started testing the interactions between applications and secure Blockchain networks. While rigorous testing between the two developers involved realized that public Blockchains that require each peer to execute every transaction and The run consensus, at the same time - takes a tremendous blow with scalability as the network takes an exhaustive measure to ensure security, above that any transaction that has a measure of confidentiality and privacy attached to it cannot be executed on the Blockchain.

Because of its public nature as every ledger on the network will get updated and confidentiality is lost to understand the concept of a private and confidential contract let's look at a simplistic


let's say Anil in India wants to buy chocolate from his friend suman who lives in Switzerland as they were old friends. Suman sells Anil her chocolates at a pretty generous discount, but the catch here is that suman also supplies to several markets which still need to buy chocolates from her, and the standard rate above that to get her chocolates from Switzerland to India

There are several procedures to fulfill, for example.

First, she sends the chocolates to the mailing service, which, in turn, validates the supply after the product is packed and sealed. The district verification takes place after that during shipping distribution, logic is verified and validated, and the end payment verification is done before the package finally reaches Anil.

But, even though there are so many third parties involved in the transaction, they do not need to know about suman and Anil special deals. Now, when this whole transaction is run on a public Blockchain network where every pure has to go through, every transaction confidentiality of the deal becomes void, and every single letter on the network gets updated about suman and Anil special deal.

This is where a Hyperledger comes and wins the game on a Hyperledger -based network. The parties that were directly affiliated with the deal are connected, the ledger that gets updated about the special deal, and only suman and Anil, thus maintaining the private and confidential aspect of the contract.

Let's see how high pillager pulls this off, it all starts with suman. Looking up Anil through an app that, in return, sends the query to a membership service and sends the transaction only to the peers directly affiliated. Both the parties now will generate a result in this two-party agreement. Both results generated need to be the same for it. To get validated, but in other transactions, whether there are multiple different parties, other rules can also be applied as needed. The validated transactions are then sent to a consensus cloud for ordering, these order transactions are sent back to the affiliate appears and then committed to their legends.

This same pattern of a transaction is needed by multiple industries where private and confidential applications need to be met by multiple parties without processing everything through a single centralized authority. Now that I've told you what hype ledger is how it pulls off the prohibition Blockchain network - let's go through the architectural changes that make this all possible.

The most notable changes can be seen in the peers which make up the whole network. The peers are separated into two different Runtimes and three distinct roles, namely endorsers committers, and consent is when endorsers and commit appears are executed on the same runtime. The consent appeals are run on a completely separate runtime. This allows item's modular architecture to allow properties, like a consensus, to be a plug-and-play feature, which in return allows a high degree of personalization to the network according to the needs of the business.

Now let us go over the peer rules. The first, the peer rule. We are going to discuss, is that a comment on the most simplistic role? Is that of a commenter node? Their only role is to append validated and order transactions to the specific ledger once returned by the consent is normally, a committer can work as an endorser of the same network, but as more and more restrictions are imposed on the network. The merging of endorses and committers is completely avoided.

The second role is that of an endorser. These nodes simulate the transactions about the book and also prevent the occurrences of non-deterministic and unstable transactions. It is important to note that, while committers may or may not endorse, depending on the network, restrictions, all endorse act as Committers on a Hyperledger network.

Last, we have the consent URLs, which work on a different runtime. These nodes run the consensus. The algorithm on a network and can be very well thought of as the body card of the network that validates every transaction, deciding whether or not it should be added to a ledger. Now that we know what Hyperledger is, where it's necessary, and how it works.

Let's compare Hyperledger to the two most renowned Blockchain networks and that is Bitcoin and Ethereum, starting with cryptocurrencies, while Bitcoin and Ethereum both have their respective currencies. Ledger has no official form, but if a business seems necessary that they need a coin for themselves, they can always implement one, moving on to networks. Bitcoin and Ethereum are both highly public Blockchain networks.

Hyperledger is a consortium Blockchain , which is also known as a commission network talking about consensus, algorithms Bitcoin uses char 256, which stands for secure, hashing, algorithm, 256 and Ethereum uses another hashing algorithm called a cache first, while Hyperledger uses a completely New concept called practical for Byzantine tolerance, which checks how much time a transaction has lived on a machine.

Bitcoin has no support for smart contracts or any sort of business logic. On the other hand, Ethereum supports smart contracts. The Ethereum smart contracts are mostly written in solidity, while Hyperledger. Smart contracts are written in the chamber of the language each network is written in, Bitcoin is written in C++, while the Ethereum and Haifa ledger uses a mix of Golang along with Python or Java, respectively.

I hope you have enjoyed listening to this. Please be kind enough to like it, and you can comment on any of your doubts and queries, and I will reply to them at the earliest.