Blockchain: A Digital Business Transformation

Estimated reading time: 8 minutes

This post will discuss why enterprises should consider using blockchain for various business processes. It also includes supply chain management and product traceability. We’ll also look at some examples of how these applications could be implemented with blockchain technology.

Decentralized storage makes it possible for anyone to rent out excess computing power as a “cloud” service without relying on any third party. The result is an entirely new type of cloud computing infrastructure that can provide secure, cheap, and reliable data storage for millions of people worldwide.

In the past year alone, we’ve seen several companies launch their versions of distributed cloud storage platforms: Storj, Sia, Swarm, MaidSafe, and others. In addition to these projects, there is an increasing number of open-source blockchains that support decentralized data management., such as Ethereum.

Moreover, Amazon Web Services offers several services for running private blockchains.

The company’s announcement comes as the market for enterprise blockchain solutions continues to grow. More than half of the organizations surveyed plan to use or are already using blockchain technology.

The world is changing at an unprecedented pace, and the way we work is no exception. The workplace change rate has never been faster than it is today, as organizations are forced to adapt or die.

As a result, many companies are looking for new ways to stay competitive. One such method is the adoption of digital technologies. In fact, by 2022, 70% of large organizations will be using some form of digital technology.

Why Blockchain?

Many large enterprises and startups have already adopted the technology to solve problems ranging from supply chain management to identity verification.

However, while the potential benefits of distributed ledger technologies (DLTs) are clear, it remains unclear how they will fit into existing business models. Will they replace centralized systems? Or will they complement them by providing new services that improve efficiency and reduce costs?

In the meantime, here is what you need to know about blockchain technology before you start building your decentralized applications.

What Is Blockchain?

Blockchain is an open-source distributed ledger system that simultaneously records transactions across many computers, creating a permanent record of those transactions that cannot be altered or deleted. 

By 2021, prominent in-industry value chains enabled by blockchains will have extended their digital platforms to their entire ecosystems. According to IDC’s 2019 Predictions for Worldwide Digital Transformation, worldwide spending on blockchain came in at around $4.1 billion this year, 50% more than in 2019.

Blockchain technology has the possible control to revolutionize many business sectors. However, its adoption is still limited due to a lack of understanding among users. To help drive greater adoption, experts are launching a new Blockchain-as-a-Service platform that allows developers to build decentralized applications. This enables developers to create DApps without worrying about managing servers or maintaining databases.

Some startups have emerged over the past couple of years, intending to make it easier for companies to use blockchain-based solutions.

How Service Providers Are Utilizing Blockchain Technology for Business Purposes

The companies that have been able to launch their object storage services include Amazon Web Services (AWS), Microsoft Azure, and IBM SoftLayer, to name a few.

Object storage is a type of cloud-based data storage where users can store their files on servers maintained by third parties. The advantage of this service over traditional file-hosting sites, such as Dropbox and Google Drive, is that the user retains ownership of their files. If the company goes out of business or ceases to exist, the user’s files will be safe from being deleted.

In addition, object storage has other advantages over traditional cloud storage solutions.

Amazon

In addition, Amazon Managed Blockchain supports multi-accounts and provides an interface for managing permissions and access control.

“We are excited about this new offering,” said Jeff Barratt, vice president of global technology strategy at Amazon Web Services, in a statement. “AWS customers can now use our Managed Blockchain service to create permissioned blockchains that span multiple AWS accounts.”

Amazon’s Chief Technology Officer Werner Vogels, during the company’s earnings call, said, “It’s about making sure we can scale to billions of transactions.”

The company’s first primary use case is with the shipping industry. It will be used to track shipments from shippers to carriers and track cargo through ports. The company also announced that it would be working on a new project called “Smart Containers,” allowing containers to communicate with each other and their drivers.

The company has been working on the project since 2016, and it was announced last year. 

Microsoft

Microsoft has been expanding its blockchain-based storage to include the ability for customers to use their blockchains and private clouds to store data securely. This is part of Microsoft’s new “Azure Blockchain as a Service” initiative.

In addition to providing a way for companies to create their blockchains, Microsoft also plans on creating an open-source version of Ethereum called Azurite.

The Azure Blockchain Service provides a secure environment for building distributed applications that can be accessed anywhere in the world. The service also includes tools for developers to create Ethereum-compatible intelligent contracts and instruments for managing private blockchains.

Microsoft has been working on this since 2016 when it announced its intention to offer an enterprise-ready version of Ethereum. At that time, Microsoft said that the Azure Blockchain Service would support both public and allowed blockchains. 

IBM

IBM has been building blockchain platforms since 2015. The company has also been working with partners to develop blockchain solutions in supply chain management, digital identity, healthcare, insurance, and more. In May 2016, IBM announced it had designed an open-source version of Hyperledger Fabric, its own distributed ledger platform based on Apache Sawtooth Lake technology for developers and organizations to build their enterprise blockchains.

IBM has also been active in developing standards around blockchain technologies. 

The emergence of such services is part of an ongoing trend toward decentralizing data centers and other IT infrastructure that has been underway for years. Many of today’s cloud providers already offer customers the option of storing their data in locations outside of traditional data center facilities. For example, Amazon Web Services offers its own “Global Network” of distributed data centers worldwide.

The Promise Of Blockchain Technology

Blockchain technology can revolutionize business processes by creating new ways for companies to communicate securely across borders and share critical information.

Blockchain’s potential is vast, but its adoption has been slow. The technology still faces many challenges before it can be used widely in business.

What are some of those challenges?

1. Security

The first challenge for any new technology is security. Blockchain requires a distributed network that allows multiple parties to share information without compromising privacy or security. This means that every participant on the web must verify all transactions. If one party tries to cheat, everyone else sees it immediately.

2. Scalability

Another issue facing blockchain technology is scalability. Unlike centralized databases, which have only one database server, blockchain networks require each node to verify every transaction. As a result, blockchain systems are not scalable because they need large amounts of computing power to process transactions.

3. Privacy

Finally, blockchain technology is often criticized for being too transparent. Because every transaction is recorded publicly, anyone who knows where to look can see what people do. This makes it hard to keep sensitive information confidential.

The first generation of decentralized storage networks is already up and running and has been used by various companies as a cheap and easy way to back up data. For example, several well-known websites have used the Sia project, including Reddit, Imgur, and Wikipedia, to provide free cloud storage space. The Sia team estimates that it offers more than 1 petabyte of free monthly storage space.

The rise of decentralized applications has also increased demand for data storage, as dApps need fast access to large amounts of data stored in the cloud. That’s where Storj comes into play: the company is developing a new cloud storage platform that uses peer-to-peer technology to store files across multiple servers worldwide.

The other service being developed by 0Chain is a blockchain-enabled data center, which will use its hardware to provide storage for large amounts of data and compute power. The company has already built a proof-of-concept prototype, but it plans to build a full-scale version later this year.

Conclusion

The question now is: what does this mean for developers? How can we leverage these rapid innovation technologies to build better software? What are the implications for our daily workflows?

Related Reading:

• The Impact of Blockchain on WordPress Development
• Everything You Should Know About Digital Transformation And How It Works