How to Choose an Enterprise Blockchain Platform?
Blockchain is more than just cryptocurrencies. Many companies are now starting to embrace the many benefits of this technology. While tech businesses were expected to have more affinity to begin deploying blockchain, financial institutions, once skeptical, are now leading its adoption into their operations.
A blockchain consists of an immutable record of data that acts as a decentralized ledger shared by a cluster of computers or “nodes,” which securely registers transactions in “blocks” of data. When running a blockchain, a standard layer to integrate transactions is deployed and becomes part of the core of any enterprise blockchain project. Hash codes secure the blocks of data. A hash is a code created by a mathematical function that transforms them into nearly unhackable lines of code.
The immutability features of blockchain guarantee that no person can manipulate the data, now stored as an encrypted sequence of transactions that can be tracked in real-time. Before thinking about integrating blockchain into an organization, it is necessary to take a look at the available platforms and their attributes.
How Is Enterprise Blockchain Any Different?
Blockchain technology provides organizations with a secure and transparent way to execute transactions through a cost-effective infrastructure. A blockchain applies to many companies belonging to multiple industries — not just financial services. For instance, a company may integrate their systems into a blockchain for added security and efficiency.
Public blockchains offer decentralization when keeping data registries, which means that the data is distributed among anonymous nodes. By using permissionless participation, practically anyone who wants to get involved in the network can join. A business, however, would most likely want a central authority to keep privacy and control over its data.
A private blockchain can be configured using exclusively permissioned participation in which the identities of the users are known. Also, a private blockchain would allow organizations to pivot more rapidly since only pre-approved users can participate, compared to public blockchains, that require a consensus process that may be less efficient.
Why Use an Enterprise Blockchain Platform?
To date, many companies are still wondering whether they should implement blockchain or not. For some organizations, it may seem very costly and even complicated to start developing a new blockchain from scratch. Luckily, there are many blockchain platforms available with different functionalities that assess particular needs.
A blockchain platform is a protocol that must provide an end-user the ability to interact fully with the blockchain. Some examples of platforms are: Ethereum, Hyperledger Fabric, or our preferred one, EOS — developed and launched by block.one in 2018. Most of these are in constant reinvention and upgrading, freeing companies from the hassle to worry about developing new features.
Companies that require high security, trust, and transparency when keeping registries, and also value cost-efficiency, may find great benefits when integrating a blockchain platform. Some benefits of enterprise blockchain technology are:
- Seamless integration: Using a blockchain platform may become a faster way to implement the technology seamlessly into the organization.
- Added efficiency: Through smart contracts, it is possible to process transactions quickly, with added efficiency compared to cloud platforms, and less costly by reducing administrative fees.
- Improved security: The immutability and encryption capabilities of blockchain can reduce data manipulation, human error, and even cyber frauds. Blockchains use a “hash,” a code created by a mathematical function that transforms blocks of data into lines of code. Hash codes make a blockchain very difficult to hack!
- Transparency: It is possible to keep a transparent and near real-time registry of data that can improve the trust and traceability of processes, for example, in a supply chain.
- Enhanced auditability: A permissioned blockchain would allow an organization to control access and authorizations across the network, increasing accountability among the team, and facilitating auditability.
Choosing an Enterprise Blockchain Platform
As mentioned previously, every blockchain platform is different, so you must spend some time understanding and identifying which one is the most suitable for your organization. For instance, you must take into consideration aspects such as the language used for software development, pricing, and consensus mechanism, and what kind of network it employs.
These are some blockchain platforms that offer solutions for enterprise blockchain systems:
Launched by block.one in 2018, EOS or EOSIO is an open-source blockchain protocol that uses a consensus model known as Delegated Proof-of-Stake, where computers do not compete over computational power to solve algorithms.
Instead, nodes elected by users, known as “Block Producers,” are the ones in charge of running the network, making the consensus mechanism fast and energy-efficient.
EOSIO allows organizations to develop decentralized apps and execute smart contracts. It is a versatile platform with unlimited scalability and rapid deployment. Using this platform would require less time to verify blocks of data, particularly useful for commercial-scale Dapps (decentralized apps). EOSIO also has its native token: EOS.
Additionally, EOS uses programming language C++, which is very common, which makes its adoption and learning processes more accessible and more seamless among experienced developers.
Developed by Vitalk Buterin, Ethereum is a blockchain platform founded in 2014 that offers flexibility and adaptability for multiple industries. It appeared shortly after Bitcoin but introduced new concepts such as smart contracts and Dapps (decentralized apps). Buterin built Ethereum as a public blockchain for B2C applications; hence its permissionless ledger may become somehow tricky for enterprise use.
Ethereum uses a Proof-of-Work consensus, in which “miners” must compete for digital tokens (called “Ether”) when completing transactions. Mining requires large amounts of power to run specialized computer hardware that will solve complex algorithms, thus increasing costs to maintain the networks. With a long time in the market, Ethereum has a solid base of developers that use this protocol.
3. Hyperledger Fabric
This platform was launched in 2016 by Linux Foundation, Digital Asset, and IBM. Hyperledger Fabric is an open-source blockchain with modular, scalable, and secure features aimed at industrial size solutions. A modular architecture would enable the developers to plug additional components such as ordering or membership services.
It supports a permissioned ledger, meaning it is operated by a group of known and identified participants, offering a secure way to manage interactions among entities. This platform supports smart contracts written in general-purpose languages such as Java, Go, and Node.js. Hyperledger Fabric does not offer built-in currency, but they encourage users to develop one using chaincode or smart contracts.
Quorum, launched in 2016 by financial institution J.P. Morgan, is an Ethereum-based open-source blockchain platform for cross-industry solutions. Enterprise-focused, this platform acts as a permissioned network that supports public and private transactions that require complete data security.
Quorum intends to solve many concerns in the financial sector, thus offering high privacy and confidentiality of records, a simple voting-based consensus mechanism called QuorumChain, and faster performance when processing transactions compared to Ethereum.
Corda is an open-source platform launched in 2015 by enterprise blockchain software firm R3. Corda allows the execution of smart contracts for multiple industries, but mainly for the financial sector. It integrates a firewall that permits incoming connections only from Corda nodes and uses a strict privacy model that prevents unauthorized access to the blockchain.
Corda was built as an interoperable, distributed ledger technology (DLT) in which only the entities that participate in the deal will have access to view or store transactions. It would allow improved confidentiality compared to Hyperledger Fabric that uses separate channels for each relationship. Corda is more scalable in that matter since it only records deals among its network.
These are some of the blockchain platforms widely used for enterprise solutions. Each one has different features that would make them ideal, depending on the industry focus and specific solution, resources needed to adapt the platform to operations or security requirements inside the organization.
At the end of the day, this decision of what blockchain platform to implement will have a significant impact on how the blockchain will leverage the businesses’ processes. When comparing the platforms, some key features to look for are:
- Privacy: How are the blockchain’s security and confidentiality protocols different from others’?
- Transparency: How relevant is it for the organization to share transparent and reliable information?
- Cost-efficiency: Would the organization see a significant reduction in costs by either eliminating the middleman with smart contracts or by simplifying the data sharing process?
- Quick adoption: Can your team make use of their experience with programming languages, or do they need to learn a new one?
- Speed or throughput: How quickly does your solution need to be? Are you a high-frequency trading company, or can you afford 12 min block confirmations?
EOS Costa Rica develops blockchain-based solutions for any organization and provides resources to the EOSIO infrastructure. We have experience integrating enterprise systems into an EOSIO blockchain. Contacts us or follow us on social media: