Blockchain consists of data blocks that are chained together and secured using cryptography. The blocks are linked in chronological order and can only be added to the chain in a linear sequence, one at a time.
The process of adding new data to the blockchain is called mining. For a new block to be added to the chain, it must contain an answer to a complex math problem that's been solved by someone else on the network in what's called a proof-of-work system.
An enterprise blockchain is a permissioned blockchain network integrated into business processes to increase efficiency at scale. As with all blockchains, they are still a digital record of transactions that use cryptography to secure data and prove authenticity. However, unlike public blockchains like Bitcoin and Ethereum, an enterprise blockchain is usually a restricted, permissioned network only accessible by approved participants. This privacy makes enterprise blockchain ideal for internal use by businesses for managing and tracking supply chains and settling global financial transactions.
In a nutshell, an enterprise blockchain differs from other blockchains because a centralized entity or group controls it. In contrast, a permissionless blockchain such as Bitcoin is decentralized and can not be controlled by any single organization. This ability to directly control the blockchain allows an organization more power to block transactions should it be required.
Some of the main characteristics of enterprise blockchains include:
Enterprise blockchains often fall into two main categories "private" and "consortium".
A private blockchain is used within a single organization and operates in a closed internal network.
A consortium blockchain is used by several authorized organizations to aid collaboration within a tightly controlled, transparent yet secure environment.
This is not to say that it is impossible for a business to use a public blockchain as it is entirely possible however, most choose not to because they prefer to have some form of control. At LifeHash we believe that it is a crucial point to address before discussing any implementation of a enterprise blockchain.
Businesses worldwide are adopting enterprise blockchain solutions because it is;
Data breaches are becoming increasingly common as organizations store vast amounts of valuable data in vulnerable centralized storage. Enterprise blockchain offers greatly enhanced security by combining the benefits of a distributed network, cryptography, and blockchain structure. Storing data on a distributed network with a consensus mechanism makes hacking extremely difficult as it requires taking majority control of the nodes. In most cases, it is futile because of the cost involved. In addition, all the data is cryptographically hashed, making it indecipherable without the correct keys. And if these two facts don't make it difficult enough, the structure of a blockchain with its timestamped chain-linked blocks means that if any data is changed, then it would corrupt the entire chain and be impossible to go unnoticed.
Trust is vital in building successful business partnerships and is centered around transparency. With blockchain, all users can see every transaction on-chain safely knowing that the data is authentic. This transparency can revolutionize supply chains allowing for the precise tracking and recording of products. Being able to produce an accurate report on the exact provenance of your product to customers is becoming ever more critical in a consumer-driven market focused on sustainability and will build confidence in your brand.
Enterprise blockchain solutions facilitate communications allowing companies to communicate directly without relying on third-party services. Imagine company X must send a considerable amount to company Y across international boundaries. The current global banking system may take days to complete the transaction. However, the same transaction, processed with blockchain technology, would take a fraction of the time.
Ethereum is a blockchain-based, open-source, decentralized computing platform that enables smart contracts and Distributed Applications (ĐApps) to be built and run without downtime, fraud, control, or interference from a third party.
LifeHash takes existing time-tested blockchain solutions, such as Bitcoin and DigiByte, and applies them to industry-specific challenges. By doing so, we take innovation straight to your proverbial doorstep. There is no need for complex integrations, legally dubious token systems, or specific blockchain industry knowledge.
The Hyperledger Project was started in December 2015 by the Linux Foundation to create a new generation of open-source distributed ledger technologies (DLT). The project has released several successful enterprise-grade software frameworks and tools.
Corda is a distributed ledger platform developed by R3. It has been used for various applications in banking, insurance, and healthcare industries, to name a few. Corda has been designed from the ground up to be more interoperable and scalable than other platforms such as Ethereum or Hyperledger.
Major organizations with well-known names are exploring DLT (Distributed Ledger Technology) and don't want to fall behind.
Are you exploring the advantages of enterprise blockchains? We are available for consultancy and implementation help. Contact us for more information