Quorum Meetup: How Private Transactions Work on Quorum Quorum, like Ethereum, supports smart contracts written in solidity, with the added feature for private transactions. In this meetup, developer advocate Syahrul Nizam (https://github.com/syahrul12345) will run through how Quorum implements this privacy feature with the power of the transaction manager and enclave. About Quorum (https://www.goquorum.com) Based on Ethereum, Quorum is an open-source blockchain platform that combines the innovation of the public Ethereum community with enhancements to support enterprise needs. About Chainstack (https://chainstack.com) Chainstack is a multi-cloud and multi-protocol Platform as a Service that empowers businesses to rapidly build, deploy, and manage decentralized networks and services. Chainstack's user-friendly interface and a rich set of APIs help businesses to implement enterprise-grade decentralized solutions and quickly progress from proof of concept to production on their use cases. At Chainstack, we are making it simple and cost-effective for innovative businesses to leverage the potential of decentralization. With interoperability, security, analytics, and a host of other advanced features only a click away on the platform, business consortiums can accelerate the development of transformative decentralized processes and solutions.

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Syahrul Nizam, Developer Advocate
Quorum meetup
How do private transactions
work on Quorum?

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Presented by
Syahrul Nizam
Developer Advocate
Blockchain enthusiast with experience
in creating & deploying Smart
Contracts on Ethereum
Proprietary and Confidential © 2019 2
Presented by
Syahrul Nizam
Developer Advocate
Blockchain enthusiast with experience
in creating & deploying Smart
Contracts on Ethereum

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The innerworkings of Ethereum
The Ethereum network is made up of nodes, each running an
Ethereum client like Geth
Miners
Ethereum Node
Blockchain Storage
Genesis
block
Block 1 Block (n-1) Block n
Interface
Developers

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What is Quorum?
1. Quorum is a Ethereum based blockchain, designed for use by
Enterprises.
2. It provides smart contract capability, much like Ethereum
3. What makes Quorum special is that it has support for private
transactions, which is impossible on Ethereum (somewhat)

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Transactions in Ethereum
A graphical representation of how transactions are propagated in a
regular Ethereum network
Application creates a
transaction payload
Transaction payload
is compiled into
solidity bytecode
Transaction payload
is sent via RPC or
Websockets to an
Etheruem node
Ethereum node
converts this solidity
bytecode to EVM
opcodes
Opcodes are a set of
instructions for the EVM
to execute
Stored on the Blockchain

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Quorum nodes
A quorum node consists of two things….
A minimalist Geth node to provide
EVM functionality
A Tessera node for private
transaction support
Public DB PrivateState DB Private DB
Connected Connected

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Let’s visualize the private transaction
Application Layer
Quorum transaction payloads are identical to Ethereum’s transaction payloads with an additional
privateFor parameter
Alice wishes to make a private transaction to Bob
She supplies Bob’s Tessera public key in the privateFor
parameter of the transaction payload:

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Sending the transaction payload
The application then sends the transaction payload to Alice’s Quorum node
Application Layer

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Quorum node
The Quorum node detects the presence of the privateFor parameter in the transaction payload.
Each Quorum node comes with it’s own paired Tessera Node ( Transaction Manager + Enclave )
Transaction Payload
Geth Client
Transaction Manager Enclave
Quorum Node
Geth Client Transaction Manager Enclave
Quorum Node
Tessera Node
Tessera Node

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Tessera node (Alice’s)
Transaction manager makes a
call to the Enclave with the
transaction payload
Enclave verifies the transaction payload
Enclave
Enclave generates a random nonce(an
arbitrary number) and a RMK (an
arbitrary password)
Transaction Manager
Enclave

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Tessera node (Alice’s)
Enclave
EncodedABI payload is
encrypted using the nonce and
RMK

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Tessera node (Alice’s)
Enclave
Alice’s Tessera Private Key and
Bob’s Tessera Public Key
(supplied in transaction payload)
and a random Number is used
to encrypt the RMK itself
Encrypted RMK and encrypted
payload sent back to Alice’s TMTransaction Manager

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Tessera Node (Alice’s)
Transaction Manager
The transaction manager (Alice) hashes
the encrypted payload, and uses the hash
as a key to store the encrypted payload &
encrypted RMK in the private database
This same information is sent to Bob’s
transaction manager and stores in his
own private database
Bob’s Transaction manager
acknowledges receipt
Alice’s transaction manager
then returns hash to Alice’s
Quorum node Bob’s Transaction
Manager

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Quorum node (Alice’s)
Alice’s Quorum node then replaces the data parameter in the transaction payload with the hash
received from Alice’s transaction manager
It also replaces the v value in the transactional receipt to tell other quorum nodes that it is a
private transaction, and not a normal transaction with nonsensical bytecode
Now the transaction can be propagated by the node into the blockchain normally as per standard
Ethereum protocol. Every quorum node will receive this private transaction.
Note the change in the data
parameter

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Quorum network
1. All parties will receive the private transactions
2. Everyone will try to decrypt it
How do nodes know that they are party to the private transaction??

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Quorum Node (Bob’s)
Bob is party to the private transaction
Bob’s quorum node receives a
transaction receipt with a V value
of 37 or 38.
Bob’s quorum node then obtains
the hash in the data parameter of
the transaction payload
Bob’s transaction manager will
do a lookup for this hash and see
if it exists!
Transaction ManagerQuorum Node

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Tessera Node (Bob’s)
Decryption
Since Bob holds the transaction,
he can obtain the encrypted
payload and encrypted RMK in
his private database
Using his Tessera Private
Key, he can first unencrypt
the encrypted RMK
Using this unencrypted RMK, he
can now decrypt the encrypted
transaction payload
The decrypted payload is valid bytecode
Bytecode sent back to Bob’s
transaction manager

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Quorum Node (Bob’s)
Using the unencrypted bytecode, the EVM can now do
computations as per normal.
Bytecode is discarded once it’s used and privateStateDB is
updated accordingly to the instructions in the opcodes

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Quorum Nodes (Candice)
Candice is not party to the transaction sent by Alice
Candice’s quorum node receives a
transaction payload with a V value of 37 or
38
Candice’s quorum node then obtains the hash
in the data parameter of the transaction
payload
Candice’s transaction manager will look up this
hash, and the corresponding encrypted data
does not exist.
Candice’s node skips this transaction.

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Demonstration & Code
1. Create a project on Chainstack
2. Download this repository :
https://github.com/chainstack/quorum-iot-tutorial
3. Install Node.JS
4. Enjoy!
Let’s spin up a Quorum network using Chainstack

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Summary
Transaction Payload Quorum Node Transaction Manager Enclave
TxPayload sent
Send txPayload to TM Send to Enclave
Return encrypted data
Update
PrivateDB
Returns Tessera Hash
Quorum Node Transaction Manager Enclave
Propagates transaction
with v value of 37/38
Send Encrypted data
Return decrypted data
as bytecode
Returns Bytecode
Checks
for hash PrivateDB
Send txPayload to TM
Returns Encrypted Data
(1)
(2)
(7)
(3)
(4)
(5)
(6)
(8)
(9)
(10)
(12)
(13)
(11)
Send to Bob’s TM
(14)

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What’s next?
1. Visit our documentation site to quickly create your own Dapp
platforms
https://docs.chainstack.com
2. Create an account on Chainstack (2 week trial)
https://console.chainstack.com
3. Have fun!
Get started with Chainstack

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Q & A

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Contact
syahrul.nizam@chainstack.com
Helpful links
https://docs.chainstack.com
https://console.chainstack.com