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The basics of enterprise blockchain

 

Concerns about enterprise blockchain

IT leaders may choose not to implement enterprise blockchain for various reasons. One is the challenge of being an early technology adopter in a business setting. An enterprise blockchain requires a mutual agreement between several entities to share or grant access to a singular ecosystem.

Some leaders are concerned that it’s more challenging to achieve trust than public blockchain. Only specific, centralized nodes have the power to do so. Fewer nodes mean less security, meaning a few rogue nodes could compromise the baked-in consensus mode.

Another concern is speed and performance. The closed network of an enterprise blockchain doesn’t need to support multiple public transactions. As a result, business requirements limit the data stored on the enterprise blockchain.

Like any software implementation, blockchain requires change management as all participating parties must adopt unambiguous criteria for success. Those specifications may include the following:

  • joint business rules;
  • shared data definitions;
  • legal agreements; and
  • governmental regulation adherence.

Implementation can be more costly and complex than building or staying with a centralized database ecosystem. Blockchain as a service, or BaaS, could minimize costs. But a cloud-based architecture could incur expenses in other ways.

IT leaders may encounter considerable internal and external weaknesses unique to blockchain. These disruptions could include vulnerabilities such as stolen cryptographic keys, flawed data input or developer incompetence. There are also security issues such as the 51% attacks threats, which occur when a majority takes control of the transaction consensus process.

Employees and others also have concerns that enterprise blockchain will take away jobs. The worry is that blockchain will replace the administration of routine tasks such as data entry, manual verification and managing paperwork.

An organization with sustainability as part of its agenda needs to consider whether enterprise blockchain will conflict with its sustainability goals. While the decentralized aspect of blockchain is one of its main selling points, its colossal carbon emissions footprint can significantly impact sustainability initiatives.

Blockchain adherents and industry watchers are discussing changing the core technology to improve its carbon footprint. But it’s another indicator that enterprise blockchain may not be ready to support the goals of a sustainability-conscious organization.

 

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