Blockchain explained
Blockchains are blocks of data that are compiled together in an immutable form and then provided a unique identity. Generally, after the blocks are registered, they can be accessed by anyone on the network. Once any data has been put on the blockchain in the form of blocks, it cannot be amended further. It is called a blockchain because the data blocks are linked with each other and each new block is connected and linked to the previous blocks.
The data on the blockchain is stored and distributed across multiple locations so that means that once data has been written into the blockchain, it is made into multiple copies. So in practice, it means that a blockchain is a form of a distributed ledger. The word ledger means a method of keeping records and blockchains have a process of distributing the record at multiple places to ensure that it cannot be amended without permission from all parties which have access to the record. This also means that if a record is in the extremely rare situation corrupted at one place it can be corrected through the backup copies maintained at any other place. As of now, blockchains can be found in various forms and there are two or three popular blockchains. They are Bitcoin and Ethereum which are commonly identified as linked to popular cryptocurrencies.
What are the use cases of a blockchain in practice?
Primarily their use in daily life can be seen through their use of a cryptocurrency as we can see in the case of Bitcoin and Ethereum, for transfer of money like we can see for Ripple, and even for storage of data as we can see for common blockchain-based file storage solutions such as Filecoin.
Several popular blockchains can be used in a blockchain as a service mode by building decentralized applications upon them. The first among them is Ethereum which has a cross-industry application. As of now, Ethereum is popular for the common cryptocurrency Ether which is based on the Ethereum blockchain. The second common blockchain suitable for use in decentralized applications is called Hedera Hashgraph. Hedera Hashgraph is a fast platform that is meant to build scalable applications. The third blockchain which can also be used through the blockchain as a service model is called Ripple. Ripple is a financial services-focused blockchain that was built to promote fast transactions on the ripple network to enable money transfer across the world.
The next popular blockchain is called Eos. Eos was founded by a private company called Block. one. Eos is specifically designed for the development of decentralized applications. The company also distributed more than 1 billion ERC 20 tokens to spread the cryptocurrency and to increase the popularity of the Eos blockchain.
The fifth popular blockchain that can also be considered for deployment in a Blockchain as a service model is called Dragon chain. Dragon chain was designed to provide developers with resources to develop blockchain applications very fast. Originally developed by the Walt Disney Company and later put into open source uses, Dragonchain allows businesses to develop fast decentralized applications for use and also create smart contracts. Next, we now move to the focus of this webinar, which is blockchain-as-a-service.
How does blockchain as a service work?
The Blockchain-as-a-service model came up as a follow-up to the software as a service model which we commonly call SaaS. The software as a service model is dependent upon the fact that small companies could not access expensive software applications because they were too expensive to purchase, license, or deploy. Similarly, blockchain-as-a-service is a cheap mode for building up decentralized applications based on blockchain technology for small companies who are not able to operate their blockchain or operate their decentralized application on the blockchain without keeping in mind the cost consideration.
It came up as a service since developing and operating a blockchain or a decentralized application on a blockchain can be very expensive. It can involve costly hardware, a requirement for a fast network connection, and also may need the expertise of many people who can be very expensive to employ. To fulfill these needs, companies came up with blockchain as a service model which now allows customers to minimize costs by paying to use the particular blockchain and also enables them to create decentralized apps on the blockchain without worry about the large cost which can be incurred for creating the blockchain or for operating the blockchain individually.
Blockchain-as-a-service model provides an option for the company to use the blockchain and run applications on the blockchain without actually incurring the high cost of establishment and maintenance. Companies can just pay a fee to use the service. The blockchain-as-a-service model also reduces linked operational costs since it includes services such as decentralized application development and deployment, security services for the blockchain, bandwidth management, resource optimization, and regular maintenance of the hardware which is required to continue providing the service.
