With the explosive growth of Blockchain (distributed ledger) technology, many enterprises are trying to make sense of it all. It is commonly asked: “why, and how, should I consider the deployment of Blockchain in my current technology stack?” Presently, there are a lot of misunderstandings as to how a distributed ledger fits into and ultimately benefits an enterprise.
Let’s review some common misconceptions which serve as the foundation for the confusion regarding a Blockchain integration.
Misconception 1: Blockchain’s only purpose is as a currency database and a peer-to-peer payment mechanism
This was the case with the advent of Bitcoin around 2009-2010 which worked extremely well as a means to solve the double spend predicament. However, Blockchain awareness and adoption has grown significantly since then and currently is regarded as a technology with vast real-world use case implications. A new study from Juniper Research has found that nearly 6 in 10 (57%) large corporations are either actively considering, or are in the process of deploying blockchain technology. Moreover, a recent Deloitte study found that: 1) 74% organizations see a “compelling business case” for the use of Blockchain, 2) 34% indicated that their company already has some type of Blockchain system in production and, 3) 41% are expected to deploy a blockchain application within the next 12 months.
Misconception 2: Blockchain is a database
Somewhere along the line, many fell into the belief that a Blockchain or distributed ledger only serves as a database and is the sole custodian of data. This was the result of the Bitcoin Blockchain architecture where every transaction since origin is posted, verified, and viewable by anyone. This was a necessity for this use-case and the many other crypto-currencies in existence. It didn’t take long for many others to realize that an immutable and tamper-proof history of data, i.e., what happened, when, by whom and in what order would prove to be a compelling argument for widespread adoption. The vast number of real-world uses cases, however, accept, hold, process, and transmit vast amounts of private and sensitive information. If you factor in reputational damage for mishandling or loss, regulation, and penalties, and it becomes quickly evident that a centralized and un-permissioned ledger is not the solution.
This prompted many to re-think how to capture the benefits of a distributed and tamper-proof ledger while keeping critical data private and secure. A hybrid Blockchain approach was needed, and ULedger has provided the solution.
With the ULedger solution, our customers can preserve the privacy of confidential and personal information while receiving Blockchain benefits. ULedger is an enterprise Blockchain protocol that allows companies to augment their existing technology infrastructure with Blockchain. We have created a hybrid (public/private) Blockchain that enables data immutability without the need for system-wide consensus. This allows companies to keep their data private while still benefiting from the public consensus mechanisms inherent in Blockchain. With ULedger, each company has their own independent Blockchain -or- multiple Blockchains. Independent ULedger Blockchains in our network then cross-certify each other’s data without needing to share the underlying data.
Misconception 3: Blockchain is a stand-alone technology
At its very core, Blockchain is a distributed ledger system. It is not an autonomous technology with the power or intent to replace current systems. Those considering use case exploration and adoption should always keep this top of mind. Its power and value are realized when layered with complementary technologies and focused on targeted use cases. By way of a payment systems example, the layering of machine learning on top of a Blockchain will be beneficial in fraud prediction and detection. Algorithms can identify transactional and system-state anomalies as well as malware intrusions, bad actors, theft, and a variety of other malicious activities that enterprises face on a daily basis. Other use cases where the layering of an immutable distributed ledger on-top of an existing infrastructure includes: supply chain management and tracking, recall management, financial transactions, regulatory compliance, system logs for anomaly detection, IoT, records management, email tracking and retention, and aspects of GDPR compliance.
Misconception 4: Blockchain Integration will be Disruptive
There are also misperceptions regarding what a Blockchain integration would encompass. This is largely the result of several influences: 1) the sheer number of Blockchain alternatives and consortiums in the marketplace, 2) the overall early stages of the technology, 3) the lack of education and 4) being influenced by media noise.
ULedger is designed to be minimally invasive to an existing technology infrastructure via REST-ful API standards allowing for ease of integration to existing data management environments. Through this process, each database underpinned by ULedger becomes its own Blockchain. As a result, an entity can have more than one Blockchain. ULedger hashes and timestamps the metadata (description of the data) of all transactions that occur on the database(s) and then the hash, timestamp, and metadata are posted to a public network of ULedger blockchain nodes.
Blockchain and the Enterprise: A Natural Fit
ULedger’s Blockchain solution can make data across an entire enterprise trustworthy and provable with seamless integration. It has the power to improve business processes, introduce yet to be discovered cost savings, unlock new revenue sources, deliver additional security, and yield competitive advantages.