Blockchain has never met a use case it didn’t like. Born from the desire to remove government and banking influences from the way individuals could exchange money with one another, Blockchain and Distributed Ledger Technologies (DLT) have grown into something far larger. The advent of Bitcoin gave people a glimpse into the direction the world was heading, one that sees more peer-to-peer transactions. Blockchain has enabled cryptocurrencies, such as Bitcoin and Ethereum, to flourish (with over 2,000 different digital currencies) and become commercially acceptable by banks, retailers and consumers worldwide. This early success and excitement is now giving rise to large scale changes in the business world, one that leverages blockchain and DLT to provide an efficient, cost-effective, reliable, and secure system for transactions and enabling multiple use cases across all industries. And as a disruptive technology, blockchain is poised to be as ubiquitous as the public internet in the future.
As a disruptive technology, blockchain is poised to be as ubiquitous as the public internet in the future.
The ultimate ledger platform technology
Blockchain underpins different applications across all vertical industries. As described in our blog, Blockchain: A New Type of Internet, “Blockchain is a decentralized, shared public ledger that keeps a record of all transactions that take place across a peer-to-peer network.” This distributed, non-siloed network architecture provides businesses and their multiple counterparties with the following benefits:
- Greater visibility through peer-to-peer replication – as every transaction is shared across consensus nodes in the blockchain network, all participants have access to the state of a transaction during its entire life cycle. Different levels of participation in blockchain networks enable both consensus nodes that verify transactions and participants that are a part of each transaction. Each node can submit transactions to the network, which are then committed to the ledger based on consensus among the peers and without an intermediary (central authority).
- Greater economy and efficiency – because there is no intermediary needed to be part of individual transactions, this creates opportunities for businesses to drive greater system process automation through both blockchain-based smart contracts and internal business systems. Blockchain networks can eliminate the duplication of tasks and reduce transaction times for complex, multi-party interactions from days to, in some cases, milliseconds (ms).
- Increased trust, security and resiliency – digital signatures and consensus models validate all information and transactions. This establishes a real trust among partners, customers, vendors and even frenemies. Transactions are secure, authenticated, verifiable and immutable (errors can only be corrected with a new transaction). Also, there is no single point of failure in a blockchain network as the ledger is distributed across all consensus nodes.
The Deloitte 2019 Global Blockchain Survey reported that 53% of the respondents see blockchain technology as being a critical priority for their organizations in 2019.[i] This chart from the survey illustrates the applicability of blockchain technology across every industry.
Industries on the forefront of blockchain
Given the inclusive nature of blockchain technology, many more industries are ramping up blockchain networks to reinforce their data and transaction security posture. Here are some sectors that we see taking off:
The healthcare industry, with its rising costs, patient privacy regulations, and move to mobile patient monitoring and electronic medical records, has a high demand for more efficient and secure systems. Healthcare ecosystems need to securely manage patient records, authorize payments, settle insurance claims, and perform, track and record numerous complex transactions that come from multiple sources and are stored across siloed systems. Blockchain networks represent a key function in managing both Identity verification and critical data access to those siloed systems when coupled with APIs. This has the potential to provide a platform that can enable more efficient, effective and secure integration and patient data exchange with lower risk and better user experiences and improved ability to comply with regulatory requirements.
The orchestration of a supply chain and all of the logistics involved in areas such as the global manufacture of goods, development of drugs, or production and shipment of food requires a trusted network of partners that have visibility into each step along the way. Blockchain networks provide a trackable record of transactions that can improve efficiency, enhance user quality, reduce costs and actually save lives in all of these areas. For example, quickly identifying the source of a faulty car part, a contaminated drug component or a diseased food source. Most people don’t understand just how many parties are involved in the shipment of goods. My favorite quote by Daniel Wilson of Maersk/TradeLens along these lines is, “The average end to end container shipment includes more than 30 organizations, more than 100 people doing data entry or phone calls, and more than 200 information exchanges. It’s actually shocking any of this works.”
Media and Entertainment (M&E)
Blockchain security and validation of assets is well-suited for the M&E industry in many areas including: managing and increasing the transparency of ownership rights and royalties; tracking illegal downloading of content; disintermediating distribution of online gaming, videos and music; and reducing online advertising fraud. Fake news and “deep fake” news, where complex information processing allows a computer to generate new “fake” images, is an area where tracking the provenance of posted information could be critical in tracking down the source. It will take a fast distributed ledger system, perhaps combined with some artificial intelligence, to effectively achieve improvement over the current centralized, opaque and non-interoperable systems.
Like private-businesses, government agencies are looking for ways to improve efficiency and optimize operations for their employees and partners and, ultimately, provide enhanced services to the public. Implementing distributed ledger systems could expedite tasks in a secure and reliable manner in areas such as: personal identification, voter rights validation, regulation compliance, global trade transactions, property records, immigration processing and border security.
Looking forward, this could extend to future concepts around transactive energy, which uses blockchain to record energy use and for charging and billing. Transactive energy can enable greater renewable penetration through distributed solar and wind generation, and peer-to-peer energy trading. Gateways between traditional utility charging and billing systems and blockchain can enable integration of legacy utility charging and billing systems with distributed energy tracking.
Of companies see blockchain technology as being a critical priority for their organizations.
Realizing the value of blockchain at the digital edge
Our goal at Equinix is to enable blockchain services that are integrated with one another and our customers’ core IT infrastructure and business applications via distributed interconnection hubs to reinforce secure transactions, protect data and reduce risk, while optimizing performance and scalability. By deploying blockchain networks at the digital edge on a global, vendor-neutral platform such as Platform Equinix®, you will be able to leverage proximate and fast access to the dense digital and business ecosystems that exist at Equinix and represent your potential blockchain network peers. Further, direct and secure, high-speed, low-latency interconnection between blockchain participants and enterprise infrastructure enables faster transactions and greater performance when enabling applications which leverage blockchain- and non-blockchain-based data.
Below is an example of how an enterprise may leverage multiple blockchain networks and node deployment options on Platform Equinix:
This configuration is an example of how one of our enterprise customers is leveraging multiple blockchain networks, both public and permissioned. Their associated nodes are deployed on public cloud platforms, a private appliance in their Equinix space and they are currently investigating a multi-tenanted platform at Equinix for further expansion and flexibility. The realized value comes from the availability of multiple deployment options and being able to easily integrate those options through high performing private interconnections between them and their hybrid enterprise IT landscape. As blockchain does not exist in a silo, the network becomes symbiotic with their enterprise IT strategy, converging cleanly with a simplified hybrid infrastructure, increased application performance and greater security for handling, manipulating and distributing data.
Imagine what you could achieve for your business if you converge the geography of your blockchain consensus nodes to realize sub-millisecond latency on a permissioned network. Or place virtually infinite storage resources less than 1 ms away from an associated blockchain transaction (i.e., data access/sharing) – all of which are privately connected bypassing the internet.
In addition, on Platform Equinix, you can leverage enhanced security and key management as a service, as described in my latest blog, Efficient Encryption Key Management for Blockchain Applications.
In future blogs, we will explore use case-specific blockchain deployments at the edge on Platform Equinix.
Learn more about deploying distributed security at the digital edge.
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[i] Deloitte Insights, “Deloitte’s 2019 Global Blockchain Survey: Blockchain gets down to business,” 2019.