Smart Contract Processing

Audience: Architects, Application and smart contract developers

At the heart of a blockchain network is a smart contract. In PaperNet, the code in the commercial paper smart contract defines the valid states for commercial paper, and the transaction logic that transition a paper from one state to another. In this topic, we’re going to show you how to implement a real world smart contract that governs the process of issuing, buying and redeeming commercial paper.

We’re going to cover:

If you’d like, you can download the sample and even run it locally. It is written in JavaScript, but the logic is quite language independent, so you’ll be easily able to see what’s going on! (The sample will become available for Java and GOLANG as well.)

Smart Contract

A smart contract defines the different states of a business object and governs the processes that move the object between these different states. Smart contracts are important because they allow architects and smart contract developers to define the key business processes and data that are shared across the different organizations collaborating in a blockchain network.

In the PaperNet network, the smart contract is shared by the different network participants, such as MagnetoCorp and DigiBank. The same version of the smart contract must be used by all applications connected to the network so that they jointly implement the same shared business processes and data.

Contract class

A copy of the PaperNet commercial paper smart contract is contained in papercontract.js. View it with your browser, or open it in your favourite editor if you’ve downloaded it.

You may notice from the file path that this is MagnetoCorp’s copy of the smart contract. MagnetoCorp and DigiBank must agree the version of the smart contract that they are going to use. For now, it doesn’t matter which organization’s copy you look at, they are all the same.

Spend a few moments looking at the overall structure of the smart contract; notice that it’s quite short! Towards the top of papercontract.js, you’ll see that there’s a definition for the commercial paper smart contract:

class CommercialPaperContract extends Contract {...}

The CommercialPaperContract class contains the transaction definitions for commercial paper – issue, buy and redeem. It’s these transactions that bring commercial papers into existence and move them through their lifecycle. We’ll examine these transactions soon, but for now notice how CommercialPaperContract extends the Hyperledger Fabric Contract class. This built-in class, and the Context class, were brought into scope earlier:

const { Contract, Context } = require('fabric-contract-api');

Our commercial paper contract will use built-in features of these classes, such as automatic method invocation, a per-transaction context, transaction handlers, and class-shared state.

Notice also how the class constructor uses its superclass to initialize itself with an explicit contract name:

constructor() {

Most importantly, org.papernet.commercialpaper is very descriptive – this smart contract is the agreed definition of commercial paper for all PaperNet organizations.

Usually there will only be one smart contract per file – contracts tend to have different lifecycles, which makes it sensible to separate them. However, in some cases, multiple smart contracts might provide syntactic help for applications, e.g. EuroBond, DollarBond, YenBond, but essentially provide the same function. In such cases, smart contracts and transactions can be disambiguated.

Transaction definition

Within the class, locate the issue method.

async issue(ctx, issuer, paperNumber, issueDateTime, maturityDateTime, faceValue) {...}

This function is given control whenever this contract is called to issue a commercial paper. Recall how commercial paper 00001 was created with the following transaction:

Txn = issue
Issuer = MagnetoCorp
Paper = 00001
Issue time = 31 May 2020 09:00:00 EST
Maturity date = 30 November 2020
Face value = 5M USD

We’ve changed the variable names for programming style, but see how these properties map almost directly to the issue method variables.

The issue method is automatically given control by the contract whenever an application makes a request to issue a commercial paper. The transaction property values are made available to the method via the corresponding variables. See how an application submits a transaction using the Hyperledger Fabric SDK in the application topic, using a sample application program.

You might have noticed an extra variable in the issue definition – ctx. It’s called the transaction context, and it’s always first. By default, it maintains both per-contract and per-transaction information relevant to transaction logic. For example, it would contain MagnetoCorp’s specified transaction identifier, a MagnetoCorp issuing user’s digital certificate, as well as access to the ledger API.

See how the smart contract extends the default transaction context by implementing its own createContext() method rather than accepting the default implementation:

createContext() {
  return new CommercialPaperContext()

This extended context adds a custom property paperList to the defaults:

class CommercialPaperContext extends Context {

  constructor() {
    // All papers are held in a list of papers
    this.paperList = new PaperList(this);

We’ll soon see how ctx.paperList can be subsequently used to help store and retrieve all PaperNet commercial papers.

To solidify your understanding of the structure of a smart contract transaction, locate the buy and redeem transaction definitions, and see if you can see how they map to their corresponding commercial paper transactions.

The buy transaction:

async buy(ctx, issuer, paperNumber, currentOwner, newOwner, price, purchaseTime) {...}
Txn = buy
Issuer = MagnetoCorp
Paper = 00001
Current owner = MagnetoCorp
New owner = DigiBank
Purchase time = 31 May 2020 10:00:00 EST
Price = 4.94M USD

The redeem transaction:

async redeem(ctx, issuer, paperNumber, redeemingOwner, redeemDateTime) {...}
Txn = redeem
Issuer = MagnetoCorp
Paper = 00001
Redeemer = DigiBank
Redeem time = 31 Dec 2020 12:00:00 EST

In both cases, observe the 1:1 correspondence between the commercial paper transaction and the smart contract method definition. And don’t worry about the async and await keywords – they allow asynchronous JavaScript functions to be treated like their synchronous cousins in other programming languages.

Transaction logic

Now that you’ve seen how contracts are structured and transactions are defined, let’s focus on the logic within the smart contract.

Recall the first issue transaction:

Txn = issue
Issuer = MagnetoCorp
Paper = 00001
Issue time = 31 May 2020 09:00:00 EST
Maturity date = 30 November 2020
Face value = 5M USD

It results in the issue method being passed control:

async issue(ctx, issuer, paperNumber, issueDateTime, maturityDateTime, faceValue) {

   // create an instance of the paper
  let paper = CommercialPaper.createInstance(issuer, paperNumber, issueDateTime, maturityDateTime, faceValue);

  // Smart contract, rather than paper, moves paper into ISSUED state

  // Newly issued paper is owned by the issuer

  // Add the paper to the list of all similar commercial papers in the ledger world state
  await ctx.paperList.addPaper(paper);

  // Must return a serialized paper to caller of smart contract
  return paper.toBuffer();

The logic is simple: take the transaction input variables, create a new commercial paper paper, add it to the list of all commercial papers using paperList, and return the new commercial paper (serialized as a buffer) as the transaction response.

See how paperList is retrieved from the transaction context to provide access to the list of commercial papers. issue(), buy() and redeem() continually re-access ctx.paperList to keep the list of commercial papers up-to-date.

The logic for the buy transaction is a little more elaborate:

async buy(ctx, issuer, paperNumber, currentOwner, newOwner, price, purchaseDateTime) {

  // Retrieve the current paper using key fields provided
  let paperKey = CommercialPaper.makeKey([issuer, paperNumber]);
  let paper = await ctx.paperList.getPaper(paperKey);

  // Validate current owner
  if (paper.getOwner() !== currentOwner) {
      throw new Error('Paper ' + issuer + paperNumber + ' is not owned by ' + currentOwner);

  // First buy moves state from ISSUED to TRADING
  if (paper.isIssued()) {

  // Check paper is not already REDEEMED
  if (paper.isTrading()) {
  } else {
      throw new Error('Paper ' + issuer + paperNumber + ' is not trading. Current state = ' +paper.getCurrentState());

  // Update the paper
  await ctx.paperList.updatePaper(paper);
  return paper.toBuffer();

See how the transaction checks currentOwner and that paper is TRADING before changing the owner with paper.setOwner(newOwner). The basic flow is simple though – check some pre-conditions, set the new owner, update the commercial paper on the ledger, and return the updated commercial paper (serialized as a buffer) as the transaction response.

Why don’t you see if you can understand the logic for the redeem transaction?

Representing an object

We’ve seen how to define and implement the issue, buy and redeem transactions using the CommercialPaper and PaperList classes. Let’s end this topic by seeing how these classes work.

Locate the CommercialPaper class in the paper.js file:

class CommercialPaper extends State {...}

This class contains the in-memory representation of a commercial paper state. See how the createInstance method initializes a new commercial paper with the provided parameters:

static createInstance(issuer, paperNumber, issueDateTime, maturityDateTime, faceValue) {
  return new CommercialPaper({ issuer, paperNumber, issueDateTime, maturityDateTime, faceValue });

Recall how this class was used by the issue transaction:

let paper = CommercialPaper.createInstance(issuer, paperNumber, issueDateTime, maturityDateTime, faceValue);

See how every time the issue transaction is called, a new in-memory instance of a commercial paper is created containing the transaction data.

A few important points to note:

  • This is an in-memory representation; we’ll see later how it appears on the ledger.

  • The CommercialPaper class extends the State class. State is an application-defined class which creates a common abstraction for a state. All states have a business object class which they represent, a composite key, can be serialized and de-serialized, and so on. State helps our code be more legible when we are storing more than one business object type on the ledger. Examine the State class in the state.js file.

  • A paper computes its own key when it is created – this key will be used when the ledger is accessed. The key is formed from a combination of issuer and paperNumber.

    constructor(obj) {
      super(CommercialPaper.getClass(), [obj.issuer, obj.paperNumber]);
      Object.assign(this, obj);
  • A paper is moved to the ISSUED state by the transaction, not by the paper class. That’s because it’s the smart contract that governs the lifecycle state of the paper. For example, an import transaction might create a new set of papers immediately in the TRADING state.

The rest of the CommercialPaper class contains simple helper methods:

getOwner() {
    return this.owner;

Recall how methods like this were used by the smart contract to move the commercial paper through its lifecycle. For example, in the redeem transaction we saw:

if (paper.getOwner() === redeemingOwner) {

Access the ledger

Now locate the PaperList class in the paperlist.js file:

class PaperList extends StateList {

This utility class is used to manage all PaperNet commercial papers in Hyperledger Fabric state database. The PaperList data structures are described in more detail in the architecture topic.

Like the CommercialPaper class, this class extends an application-defined StateList class which creates a common abstraction for a list of states – in this case, all the commercial papers in PaperNet.

The addPaper() method is a simple veneer over the StateList.addState() method:

async addPaper(paper) {
  return this.addState(paper);

You can see in the StateList.js file how the StateList class uses the Fabric API putState() to write the commercial paper as state data in the ledger:

async addState(state) {
  let key = this.ctx.stub.createCompositeKey(, state.getSplitKey());
  let data = State.serialize(state);
  await this.ctx.stub.putState(key, data);

Every piece of state data in a ledger requires these two fundamental elements:

  • Key: key is formed with createCompositeKey() using a fixed name and the key of state. The name was assigned when the PaperList object was constructed, and state.getSplitKey() determines each state’s unique key.

  • Data: data is simply the serialized form of the commercial paper state, created using the State.serialize() utility method. The State class serializes and deserializes data using JSON, and the State’s business object class as required, in our case CommercialPaper, again set when the PaperList object was constructed.

Notice how a StateList doesn’t store anything about an individual state or the total list of states – it delegates all of that to the Fabric state database. This is an important design pattern – it reduces the opportunity for ledger MVCC collisions in Hyperledger Fabric.

The StateList getState() and updateState() methods work in similar ways:

async getState(key) {
  let ledgerKey = this.ctx.stub.createCompositeKey(, State.splitKey(key));
  let data = await this.ctx.stub.getState(ledgerKey);
  let state = State.deserialize(data, this.supportedClasses);
  return state;
async updateState(state) {
  let key = this.ctx.stub.createCompositeKey(, state.getSplitKey());
  let data = State.serialize(state);
  await this.ctx.stub.putState(key, data);

See how they use the Fabric APIs putState(), getState() and createCompositeKey() to access the ledger. We’ll expand this smart contract later to list all commercial papers in paperNet – what might the method look like to implement this ledger retrieval?

That’s it! In this topic you’ve understood how to implement the smart contract for PaperNet. You can move to the next sub topic to see how an application calls the smart contract using the Fabric SDK.