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Deciding on Blockchain

You may remember my last blog article about blockchain, I talked about how business continuity and disaster recovery will benefit from the use of blockchain technology. Now we ask, “How should businesses identify if blockchain is a good tool for the job?” The term “decentralization” is a blockchain’s main characteristic which involves game theory and cryptography as a core of its protocol design. It includes features such as immutability, liveness and safety guarantees of transaction, and censorship or attack from malicious actors.

Public and Private Blockchain

Did you know there are public and private blockchains? Public blockchains are type networks that anyone can access and add transactions to. This ensures no single entity has control, but rather everyone must trust the network’s protocol.  To give an example, Bitcoin and Ethereum are available on the public blockchain.

Other organizations, such as Hyperledger, that are private enterprises cater to companies who engage in global transactions, such as supply chain and financial services. Access to Hyperledger is permissioned and controlled to determine who can both join and access the network.

Deciding on Blockchain Use Case

In a typical online application that has a database back-end in client-server environment, a central organization has full control of records and transactions, and therefore has the ability to alter transactions stored in centralized servers, such as Amazon’s AWS. Applications can mimic the characteristics of a decentralized application, but safety and trust are not guaranteed.

Transaction per second (TPS) is also where a centralized database works best. It is capable of processing thousands of TPS while most of the current blockchain technologies are not yet capable of handling of such speed.

Blockchain assessment questionnaires published by the World Economic Forum, helps organizations in deciding if a centralized database or blockchain is best suited for their business requirements. They also provided this great flowchart below to help you determine if blockchain is your answer:

Bitcoin

Image: Creative Commons/World Economic Forum

 

Though blockchain technology is revolutionary, it is well-suited for certain cases and not always a silver bullet for all business challenges. Perhaps a traditional online database application is a better solution when considering what technology to support your next-generation application.

Don’t let the pros and cons of either proponent convince you that their approach is better. Instead, do a careful analysis of your requirements and how they may or may not be met by blockchain technologies.

 

Block Chain

Blockchain for Business Continuity and Disaster Recovery

Blockchain technology related topics are gaining a lot of attention lately, most of the attention is focused on cryptocurrency such as Bitcoin.  Some predict it as the new internet revolution which could lead to new technological innovations in economics and social transformations.

Blockchain is running on a peer-to-peer network, with many distributed nodes and supporting independent computer servers globally.  Part of it is implemented without any centralized authority and has a built-in fraud protection and consensus mechanism, such as the concept of Proof-of-Work, where peer computers in nodes approve every requirement for the generation of a new set of transactions or block to be added to the database a.k.a. “Block Chain”.

It also has a built-in check and balance to ensure a set of colluding computers can’t game the system.  Blockchain also brings in an element of transparency, which reduces fraud as the entire chain is visible and auditable.

But how will Blockchain bring innovation to businesses in performing business continuity and disaster recovery?

Peer-to-Peer Fault-Tolerant. When a disaster happens and destroys some network nodes or a cyber attack penetrates the network, this will not hinder the operation of the rest of the network because every node has a copy of the Blockchain ledger due to its decentralized nature.

Availability. It provides 24/7/365 availability without using any complex technologies, like a disaster recovery center or database redundancy.

Smart Contract.  It is capable of storing program code which will trigger once given conditions or deliverables are met. These codes are stored in a block that can call and execute system API or web services such as alert notifications, transaction rollback procedures, network lockdown and backup procedures during disaster recovery or business continuity exercises.

Secure and reliable.  Security and fraud protection is also built into Blockchain.  It employs an advanced cryptography that is close to impossible to break and tamper-proof therefore every transaction is highly reliable.

Even though Blockchain is still in its infancy, just like the internet in the late 90’s, awareness is high with some technology entrepreneurs and businesses who started developing proof-of-concepts and use-cases that later on can be used as real solutions to real problems.