As far as blockchain technology is concerned, the road to mainstream adoption hasn’t exactly been a walk in the park. Bitcoin, the first well-known blockchain application received harsh criticism from financial institutions across the board, and thus, the underlying technology powering Bitcoin was ignored. However, things seemed to have changed rather quickly over the years as numerous advantages of blockchain-based technologies have come to light and blockchain as a service (BaaS) solutions are becoming increasingly popular. In fact, experts have described the blockchain as a “disruptor,” some have even likened it to the internet in its early days, other proponents think the technology will trigger a revolution that will affect nearly all industries.
If this blockchain technological revolution occurs as experts have predicted, those who failed to embrace the technology will be left behind by their more innovative competitors. The companies that are able to successfully integrate blockchain technology into their various operations or create useful derivative applications will gain a considerable competitive advantage in their respective industries in the age of the blockchain.
As more distributed ledger based innovations spring up, companies now realize that ignoring blockchain technology could very well lead them to lose their competitiveness, consequently reducing their market share. This has sparked a new trend of experimentation and adoption of blockchain-based applications. However, despite the growing interest in blockchain technology, there have been many hurdles to overcome such as the unavailability of blockchain experts, scalability limitations, insufficient ROI on some blockchain applications, inadequate financial resources for experimentation, and other added risks that come with the implementation of new technologies.
This is where blockchain-as-a-service (BaaS) comes into play….
What is BaaS?
Due to infrastructural challenges associated with building blockchain based enterprise solutions, large tech companies now lend their cloud computing and blockchain framework to their customers to help them create their own blockchain networks, applications, and smart contracts. The BaaS model is highly functional as it combines the versatile capabilities of the blockchain with the services and infrastructure of the provider’s platform, allowing developers to pilot and ramp up blockchain solutions without worrying about architectural or hardware difficulties.
By leveraging the infrastructural service of a BaaS provider, smaller companies without blockchain expertise can now test and experiment on blockchain ideas without having to spend a large amount of money upfront. This approach also considerably reduces the time it takes them to bring a blockchain application to market.
Blockchain as a Service: Market Projection
Based on a recent market analysis, the blockchain market is projected to grow at an average annual rate of 79.6% until 2022. The unique blockchain features of immutability and transparency have been identified as the main factors driving this exponential growth. As the interest in blockchain continues to grow, more companies will seek out BaaS providers to stay ahead of their competition. Several large tech companies are now seeing attractive financial opportunities in the BaaS niche; this has led to a proliferation of BaaS platforms within the blockchain space.
Major Blockchain as a Service Providers
The American multinational technology company, IBM is invested in a lot of blockchain projects ranging from transparent food systems to secure identity networks and other private equity projects. However, one of its main blockchain initiatives is its BaaS service which is built on the Hyperledger Fabric; a blockchain framework hosted by the Linux Foundation. Hyperledger itself is a global and open source collective effort which aims to facilitate the adoption of blockchain technologies across several industries.
IBM’s BaaS solution offers its clients a proper environment for building and hosting secure blockchain networks on the IBM cloud. In a bid to strengthen the security of its blockchain platform, IBM’s blockchain utilizes a security-oriented Linux server known as LinuxONE. The company has advertised its blockchain as a fully integrated enterprise blockchain platform specifically created to enhance the development of business networks, improve governance, and accelerate growth.
The tech giant hopes this platform will be capable of delivering faster transaction rates as well as provide support for larger user ecosystems in the near future.
Oracle Corporation, a multinational computer technology corporation is another leader in the Blockchain as a Service niche. The company launched its Blockchain as a Service platform shortly after joining the Linux Foundation Hyperledger project in August 2017. The Oracle Blockchain Cloud Service was touted as an advanced enterprise-based blockchain platform that enables its customers to accelerate business growth by mitigating risks and reducing costs.
Oracle is clearly well aware of the tremendous potential of the blockchain and Amit Zavery, Senior vice president, Oracle Cloud Platform had this to say about the potential of the blockchain:
“Blockchain holds the promise to fundamentally transform how business is done, making business-to-business interactions more secure, transparent, and efficient.”
The Oracle Blockchain Cloud Service delivers an enterprise level distributed ledger platform with advanced security, resilience, and scalability.
Microsoft has been chasing many blockchain projects. In 2015, the tech giant launched its BaaS platform called the Azure BaaS. Microsoft’s Blockchain as a Service platform stemmed from a partnership with Consensys and is aimed at developers and enterprise clients to provide “a single click cloud-based blockchain developer environment.” The Azure BaaS was engineered to work in unison with a number of protocols; however, Microsoft has indicated its preference for the Ethereum network. Due to this affinity, the Azure BaaS is sometimes called “EBaaS” or Ethereum Blockchain as a Service. The service was renamed Azure Blockchain Workbench in 2018.
Microsoft’s vision for its blockchain platform is to create a medium to “help companies thrive in this era of secure multi-party computation, delivering open, scalable platforms and services that any company, from ledger startups to governments, health organizations to global banks, can use to create new value.”
The company ensured the development of the Azure BaaS by introducing the “Bletchley” code, a blockchain middle-ware/ template which allowed partners and clients to build private consortium Ethereum networks.
The Azure Blockchain Workbench platform provides a decentralized powered playground which allows its clients to learn, experiment, and fail fast at low risk. By utilizing industry grade frameworks, clients can now build private or public consortium based blockchain environments for the efficient distribution of their blockchain products. Despite being pro-Ethereum, Microsoft has claimed that its platform can support a diverse number of other blockchain technologies provided they meet its operational, performance and security standards.
Amazon – AWS
Amazon which is known for its strides in the e-commerce sector has set its eyes on distributed ledger initiatives. The e-commerce giant’s subsidiary, Amazon Web Service (AWS), announced the launch of a new service known as the AWS Blockchain Template.
Taking advantage of the Ethereum network and Hyperledger Fabrics, the AWS Blockchain Template will allow its clients to create blockchain compatible projects by providing them with tools that promote efficient management of their hosted blockchains.
According to Amazon, AWS is offering the largest global infrastructure for building end-to-end, scalable and cost-efficient blockchain platforms with support for multiple protocols.
Rising interest in distributed ledger technologies will continue to fuel the growth of the BaaS market. With industry leaders now monetizing blockchain offerings, it is only a matter of time before others join the Blockchain as a Service train. Although Google appears to be somewhat ignoring blockchain technology at the moment, analysts have predicted that with the success of IBM and Amazon, Google might just be the next big player to integrate BaaS offerings into its cloud system in the near future. All these activities prove that the blockchain is gaining traction and maturing as a viable technology with practical applications; and so far, it is showing no sign of slowing down.