Cryptocurrencies and NFTs have captured the attention of the mainstream public in 2021 and have cemented blockchains as the latest disruptive technology for virtually all industries across the board. Blockchains are a type of distributed ledger technology (DLT) where blocks of data are recorded in sequence. Enterprise blockchains, however, utilize various forms of DLTs that typically fall under the radar from the public’s eye. In this guide, we will cover what enterprise blockchains are and walk you through the current landscape.
In this guide:
- Distributed Ledger vs Blockchain
- Different Types Of Data Transparency
- Use Cases Gaining Traction
- The Leading Enterprise Blockchains
- Enterprise Blockchains Will Continue to Grow
Distributed Ledger vs Blockchain
All blockchains are DLTs but not all DLTs are blockchains. Companies will use blockchains as the underlying structure for data recording and processing which typically doubles as an immutable digital database. Consensus protocols such as proof of work (PoS) are specifically chosen for recording data but not all companies will benefit from this. In an enterprise environment, data needs to be written and accessed instantaneously for operations to run smoothly.
DLTs are an umbrella term that covers all the different types of blockchains in existence but the goal remains the same: distribute data, or components of data, across a distributed network. The network will stretch beyond a centralized location and will typically be spread across multiple networks. In DLT applications, recording blocks in a sequence isn’t mandatory as it is with blockchains. The table below shows the main differences between DLTs and blockchains.
Data is written and accessed in a particular sequence
Data is written and accessed in various ways (depends on technology)
Consists of chains made of blocks
Databases are spread across various nodes; not limited to blockchain structure
Different Types Of Data Transparency
When choosing a DLT for your enterprise needs, consider how transparent the data will be for the general public, customers, and employees. The three main types of enterprise DLTs consist of public, private, and hybrid systems.
Cryptocurrencies, NFT marketplaces, or exchanges are typically run on public blockchains so that data is transparent to the masses. This is considered normal in the DeFi industry because of the trustlessness that public ledgers provide. Anyone with a computer and internet connection can peer into the transactions made on the blockchain.
Various industries rely on data management that isn’t publicly available such as in cybersecurity, supply chain, and accounting. Since corporate data contain trade secrets or proprietary information a permissioned network is commonly utilized to enable access to only a limited number of users. Members that have access are typically verified or have some level of clearance.
As the name implies, hybrid solutions provide certain levels of privacy while allowing parts of their operations to be exposed to the public. This approach allows companies to control the flow of information on a need-to-know basis. Ultimately, this leads to better flexibility but requires a higher level of complexity in managing its data structures.
Use Cases Gaining Traction
Enterprise blockchains and DLTs are tailored for the data management requirements of the organization. Each industry will have its own needs but how exactly do these look like? Let’s take a look at a few of the top enterprise blockchain and DLT use cases.
Companies use enterprise blockchains to reach customers that would otherwise be inaccessible when it comes to payment processing. Consumers won’t need to apply for credit cards if they can get all their shopping done via the financial connection offered by the producer themselves. Companies can issue rewards points, company-specific currency, or application-based tokens to keep people tethered to their ecosystem without utilizing third-party payment processing or credit companies.
Partners in supply chain networks use hybrid enterprise blockchains to keep track of goods throughout a process. For example, auditing data and transactions in a production plant can be done in an instant. When an item is traveling through long distances across vast logistical mazes, things tend to get lost or delayed. Tracking these items is now easier and location data are not only precise but more reliable than ever before. Manual scanning of barcodes takes time and is dependent on human facilitation but smart contracts can provide real-time feedback.
In an assembly line goods, devices, and even humans can be identified in several different ways. Cameras and sensors will identify the shapes but the private enterprise blockchain will record the data captured. Consider a human that handles the goods from one test station to another. There wouldn’t be a possibility to fudge the numbers or tamper with the results because advancing to the next step of the operation would be dependent on the condition of the object and not on the input of the operator.
The Leading Enterprise Blockchains
As you can see, there are different use cases and needs for each company. Data transparency and efficiency are the main drivers that go into the enterprise blockchain setup process. Because the needs vary different enterprise blockchains offer features that may be present in one but not the other. Below are a few of the leading enterprise blockchains that are paving the way for corporate solutions.
In the world of enterprise blockchain solutions, Hyperledger Fabric stands out as a leader and innovator in the overall DLT industry. Often viewed as “the standard” of enterprise blockchains they are an open-source project and act as a foundation for developing industry. Over 120,000 organizations and 15,000 engineers contribute towards building applications and infrastructure that can scale with organizations without compromising on data privacy. The DLT enables data to be controlled and shared among permissioned participants in the hybrid network. Some of the companies that use Hyperledger Fabric are IBM, CISCO, Intel, and American Express. For a deep dive, we have 20 hours of on-demand video in our Hyperledger Fabric training course.
Corda was initially focused on providing solutions to financial institutions but has established itself as another well-rounded enterprise blockchain. It is, however, best known for serving the highly regulated finance industries such as banking, insurance, and capital markets. Corda’s interoperable blockchain networks allow data transfers while retaining strict privacy. Businesses on the network can transact directly amongst each other without compromising on security or performance. A few of the financial institutions using Corda include CitiBank, MetLife, Inc., and China Merchants Bank. For a deep dive, we have 20 hours of on-demand video in our Corda Distributed Ledger course.
Hedera is a public DLT that uses a hashgraph consensus protocol which offers a faster and more efficient alternative to existing blockchain technologies. Their network allows the issuance of tokens instead of relying on smart contracts which in comparison is more secure and faster in select applications. Though their “gossip about gossip” protocol is considered a novel way to hash data, blue chips like Google, LG Electronics, IBM, and Boeing are convinced of the technology and thus involved with the project. They are part of the Hedera Governing Council which acts as a governing body overseeing the network’s progress, ensuring stability, and committing to innovation.
Enterprise Blockchains Will Continue To Grow
Corporations are turning to enterprise blockchain technology to digitally transform the way they handle data and the processes that are tied to it. Inefficient legacy systems are slowly, but surely, being augmented by these solutions and it’s only a matter of time before we see entire industries adopt these. Virtually every industry can benefit from enterprise blockchains through automated tracking, trustless data verification, immutable data recording, and permissioned networking.