Simply defining Enterprise Blockchain

Let’s build upon a simple definition of Blockchain, which most people would agree is a shared, decentralized, cryptographically secured, immutable digital ledger.  Enterprise Blockchain enriches this definition with a few key attributes:

Accountability - meaning network members are known… identified by cryptographic membership keys with assigned access permissions by business role. Without this HIPAA and GDPR regulations would be near impossible to adhere to.

Privacy - While members are known to the network, transactions are only shared with those that have a need to know. Enterprise blockchain use a variety of techniques to accomplish privacy, including peer to peer connections, channels and zero knowledge proofs.

Scalability - supporting an immense volume of transactions is critical to enterprise scenarios. Since transactions are not typically throttled in enterprise blockchains, as they are in networks like bitcoin, they can get right down to business and perform. Of course your transaction rates depend on a number of factors including number of peers and complexity of the smart contract. With that said, transaction rates in the 1000s of transaction per second are certainly achievable.

Security - Enterprise blockchains are fault tolerant. With fault tolerant consensus algorithm the network continues to operate even in the presence of bad actors or carelessness. An example of a fault tolerant consensus algorithm is the RAFT algorithm.

Enterprise Blockchain are often stereo-typed as private networks... which I feel is an incorrect characterization. Access to an Enterprise Blockchain is set by “the governors”, who set the policy of how new members participate in the network. The visibility (e.g., public or private) of the network depends on how it is governed. So, it is true that Enterprise Blockchains are permissioned, but not necessarily private.

Oh... There is a 5th point that needs to be added to this definition, which is Incentives. An Enterprise Blockchain can benefit from a built-in incentive system to help accelerate the adoption curve. You can think about this as a “loyalty point” or a “token” that delivers a motivational and economic incentive for network providers and consumers.

Why does Enterprise Blockchain matter?

Because, today, no business operates in isolation. It should not be a stretch to think that multiple institutions could achieve more together then any single institution can alone. By implementing business processes that leverage the collective knowledge of the group, processes can be orders of magnitude more cost efficient. And even more interesting, new processes can be created that were not possible before which open up new opportunity.

For example, the US Food and Drug Administration recently added food labeling regulations involving a requirement to notify the public of "Sugar added" to food. How would a company, say producing Protein Bars, know for sure that the ingredients they are using contain sugar... and more importantly, prove it, if they are challenged. Operating on a trusted food blockchain, where ingredient suppliers recorded food information to a blockchain, the Protein Bar Company could easily show the provenance of each ingredient, from farm to "wrapper" to convenience store. This would certainly save time and money. But there's more. The same blockchain, could now be used to save lives and allow the participating companies to trace-back bad ingredients that may be causing food-borne illnesses. Given the food industry has many regulations to follow (much for our own safety and well being) you can easily imagine how an enterprise blockchain is essential to making this scenarios so. Specifically,

• Accountability - proving your institution is who you say you are to the FDA and other companies,
• Privacy - perhaps you don't want your competitor to know who you are buying your sugar from, and at what price,
• Scalability - there's lots and lots of food records,
• Security - must trust all information and information access must be resilient
• Economic incentives provide an incentive for members to contribute data

Oh... and this is real

Read more about a real blockchain for Food Trust here.

Read about how to get started with Enterprise Blockchain here.