CIPHER-IoT: Zero-Knowledge Proof Integration with Hyperledger Fabric for Privacy-Preserving IoT Systems

The proliferation of Internet of Things (IoT) devices creates unprecedented security, privacy, and transparency challenges in distributed systems. Traditional encryption-based approaches provide privacy but impose significant computational overhead, storage bloat, and key management complexity. This paper presents CIPHER-IoT, a blockchain-based framework that integrates Zero-Knowledge Proofs (ZKPs) with Hyperledger Fabric for privacy-preserving IoT data management. Unlike encryption-based approaches that store encrypted data on-chain, CIPHER-IoT utilises Groth16 zk-SNARKs to generate cryptographic proofs of data validity while storing only commitments on the blockchain, achieving stronger privacy guarantees with lower storage overhead. The framework employs Ed25519 for lightweight digital signatures and implements comprehensive chaincode for ZKP verification, commitment uniqueness checking, and access control enforcement. CIPHER-IoT targets gateway/edge IoT deployments with moderate computational capacity (ARM processors 500 MHz+) rather than ultra-constrained sensors. We evaluate CIPHER-IoT against two baseline systems, SPAS (homomorphic encryption-based) and SPAS-H (AES encryption with Hyperledger Fabric), using realistic simulation with 50–500 devices and transaction rates of 10–75 TPS. Experimental results demonstrate superior privacy (98% confidentiality vs. 80–95% for encryption-based approaches) alongside competitive performance: read latency improves 37% (p < 0.001), throughput increases 14.6% (p < 0.001), memory reduces 21.4%, network bandwidth saves 47%, and disk I/O reduces 37.8%. The system maintains zero data loss under failure scenarios and scales linearly to 500 devices with minimal degradation (9.9%). CIPHER-IoT demonstrates that verification-based privacy mechanisms can achieve stronger privacy and better performance than transformation-based approaches in distributed validation contexts, particularly suitable for enterprise IoT deployments requiring coordinated privacy-preserving infrastructure.