As noted previously, the open computing movement laid the groundwork for blockchain and Hyperledger. Open source is a software licensing model. This means that the user has the rights to the code and is free to use it, enhance it, or even redistribute it, provided this is done on an open source basis.

One of the major advantages of an open source business application is the high level of flexibility provided through open source code, modular components, and standards adherence. This enables an organization to adapt the technology to achieve true usability with minimal effort. Many applications that are backed by open source technologies can be assembled, like building blocks, to solve business problems. These building blocks come with a core set of functionalities, and each can be enhanced to meet specific business requirements. The different building blocks are easily integrated through the use of open-standard technologies, and additional features that can be custom developed in a modular way.

An open source business application can therefore provide a base set of features at a very low cost, while enabling services engagement to enhance or tailor the application to fully meet business needs:

The open source community also provides a global, diverse talent pool and community with a wide range of ideas and creativity, which generate more collaborative innovation than any single vendor ever could. It has disrupted markets and created growth opportunities for those who recognize its advantages.

Open source technologies such as Hyperledger and its family of projects provide the following advantages to the industry:

• Lower cost of software consumption: Open source technology-driven projects do involve costs associated with deployment, maintenance, management, support, and so forth. The overall costs of development and costs associated with the talent pool, however, is largely reduced. Linking the internal technology governance structure with the community-driven governance structure of a Hyperledger project can greatly reduce the costs of technology governance and compliance. The growing popularity of Hyperledger projects represents the growth of community participation, implying the availability of a diverse talent pool associated with Hyperledger frameworks and tools. This is a huge cost consideration for enterprise business networks as their requirements and business networks grow.

• Innovation and extensibility: Enterprise and business networks do not have to have the vendor locked in, but rather can choose from the most innovative and involved communities, taking advantage of fast-paced innovation in blockchain technology space. Piggybacking on community-based innovation will only amplify the business network's ability to leverage new technology and innovation from projects, and simplify business network operations and governance costs, not to mention the wide array of competing and complementing technology sets available, that provide flexibility in enterprise architecture and design.
• Sustainable development and innovation stream: LF provides governance structure to the Hyperledger community. Sustainable development implies peer review and regular software updates by the community that supports it. This enables a vehicle where business networks can enhance their value proposition and create new business models. In many cases, the business network participants may also represent the Hyperledger community, leading to a bidirectional stream of innovation, where the business network feeds business innovation-led improvements and requirements, with the technology community accepting and enhancing innovation.
• Security and reliability: The Hyperledger community provides a community of peers that review, debate, and collectively accept the technology's design and innovation. This LF provided governance structure assumes collective responsibility, as Hyperledger projects are implemented and maintained by a large community of blockchain specialists who can find and address a vulnerability at a much faster pace than a vendor who is provided with proprietary software solutions. Because Hyperledger projects include involvement from their members, who share the costs of development and governance, the Hyperledger framework is reliable, as it is openly governed and peer reviewed by the community.
• Speeds up development and market adoption: Open source projects such as Hyperledger projects have diverse communities and member organizations with common interests and a dedicated talent pool to collectively solve emerging problems. Hyperledger projects and the communities behind them provide developers and business networks the opportunity to contribute and consume software at the pace of innovation. The speed of development and market adoption is a critical consideration for many business networks at this stage of rapid technological innovation with respect to consensus, blockchain databases, security frameworks, encryption, and tooling.