You most likely heard about blockchains such as Bitcoin, Ethereum, EOS, Ripple and others. But did you know that these are public blockchains – they work according to the rules set by their users (ideally), without the influence of individuals (developers/owners of networks). However, there are private blockchains that solve many problems and issues for businesses with an acceptable and controlled level of centralization. It sounds a bit strange, but let’s figure it out.
The private corporate blockchain is an optimal solution for companies, especially for those that have more than one representative office. With the help of a private blockchain, it can be set up the secure channels for workflow and fast data exchange between offices and other partner companies. Maersk, the world’s largest carrier, is looking in the direction of the blockchain technology. In collaboration with IBM, a blockchain platform was presented for logistics companies to manage and track documentation related to millions of containers around the world.
A private blockchain will suit enterprises from completely different areas and various sizes – the solution will successfully fit into the processes of both retail companies and global ones (for example, representatives of the financial sector – banks). By the way, the largest bank in Poland, PKO Bank Polski, together with the British company Coinfirm, have already launched the blockchain solution Trudatum, designed to manage the workflow of a financial institution and enhance the protection of its customers’ data.
The project was first announced after a year of testing in March, and now it will be available for almost half of the bank’s client base, which has chosen a new form of information transfer.
Recently, interest in the corporate blockchain from businesses is increasing, so it should be considered in detail how this technological solution may affect the operation and functioning of companies.
Advantages of private blockchains
Firstly, corporate clients often put security and limited access to company data on a pedestal of importance. Blockchain means protecting information by inputting it into a distributed network, encrypting the blocks of a chain using a hash function, thus minimizing the risks of hacking the system and compromising it by third parties.
It is worth noting that from the usual blockchains, corporate differ in the decentralization’s level. Yes, corporate distributed chains also function using nodes, but in this case, the network node is a specific user who is responsible for certain tasks in the company. At the same time, the head of the company has the opportunity to appoint network administrators (nodes) at his discretion, giving them access to certain functions. Since the overall functioning of the system depends on a specific user, it cannot be called decentralized, however, providing a new level of security, we can consider the blockchain as a technology that takes businesses to new levels of development.
Secondly, when using an exclusive blockchain, transactions are processed only by those responsible employees who have a special key. At the same time, this employee can also restrict access to reading the entered information, if there is a need. As a result of the introduction of such a system, companies are beginning to optimize their internal processes through the organization of an internal highly controlled environment. However, I believe that the main advantage of introducing corporate blockchains is minimizing the human factor’s influence on processes, which leads to reduced errors and fraud on the part of unscrupulous employees.
The private blockchain ensures the formation of a transparent management structure, which differs from the standard one with not only honesty between its participants but also with adaptability and flexibility. A huge choice of the developed consensus algorithms allows customizing the blockchain for almost every type of business. The first thing that comes to mind is electoral political campaigns. Last year, municipal voting was held in Swiss Zug using blockchain technology.
Between corporate blockchains, you can also draw a parallel with PaaS solutions, since their publicly available systems are very similar to each other because private blockchain chains are developed on the basis of frameworks.
Despite the indisputable advantages and already sufficiently developed blockchain industry, business owners still need to carefully consider security tools and pay attention to the means of protecting the DBMS (database management system). If the company doesn’t pay attention to this issue, its system will not be secured even by calculating complex hashes, since for this purpose a computational power comparable to that of potential intruders will be required.
On the other hand, the corporate blockchain system does not require a global approach to protection against threats emanating from its participants,as the internal network users are well-known employees and each of them has access to those functions that are pre-agreed and granted to the system, where their participation is required depending on the assigned tasks. For this reason, private blockchains are considered more secure than public chains.
Corporate blockchains in action
With the support of the US State Department, Coca-Cola Co, as well as through cooperation with two blockchain companies, BitFury and Emercoin, creates a protected labour force registry. This decision should entail the elimination of forced labour worldwide. Coca-Cola plans to use a secure blockchain-registry of employees and labour contracts in order to increase the transparency and efficiency of the verification process in the company’s labour policy within the supply chain.
Famous technical giant, Lenovo, plans to use a private blockchain to verify documents by integrating digital signatures into them. That is, a digital “map” is created for each document, which can be compared with a copy and check whether the information provided is genuine.
While Lenovo is only preparing to make a powerful blockchain jump, the audit company Deloitte EMEA has already merged with the Norwegian certification company DNV GL. The fruit of their cooperation is the corporate blockchain for recording and storing certificates of inspection of oil platforms, ships and other types of maritime transport. To verify the certificate, it is necessary to scan the QR code and this approach completely solves the problem of forged documents. The private blockchain Deloitte EMEA already stores data of more than 90,000 certificates.
States’ representatives are also looking at private distributed chains. For example, the national agency of public registries of Georgia moved the entire land registry of the country to the blockchain. Partners in the Georgian technological breakthrough became the company Bitfury Group. Now all data on property rights is recorded in the blockchain, which completely eradicates the risk of important documents’ falsification.
Private corporate blockchains are able to provide businesses with a chance to develop in step with technological trends that set a completely different rhythm of life. If earlier it was possible to expect to receive any documents for several days, now the business requires instant reactions. Moreover, ensuring the security of data transmission and the guarantee of their authenticity is what each company should go to because the key to a successful business is the correct approach to work processes and the honesty of their participants.