by Ralph Tkatchuk

The rise of Blockchain-as-a-Service

Dec 18, 2017
E-commerce SoftwareTechnology Industry

For businesses and their ITDMs, the key is to have a blockchain strategy in place. The technology offers capabilities that could benefit most businesses, but further improvements are bound to come about as these platforms evolve their capabilities and services mature.

blockchain ecosystem
Credit: Thinkstock

The meteoric rise of the price of Bitcoin and the flurry of initial coin offerings (ICOs) over the latter half of the year have put blockchain in the spotlight of tech. All that buzz has prompted many organizations to aggressively look into blockchain adoption. If large organizations are doing it, why shouldn’t everyone else?

Several tech companies have already responded to this heightened interest by offering blockchain-as-a-service (BaaS). Enterprise computing giants have come out with their respective offerings. Microsoft makes their BaaS available through Azure. IBM also has their own BaaS that’s based on the Hyperledger Fabric and is made available through the Bluemix cloud platform.

Blockchain and smart contract platforms like Ethereum and NEO have also contributed to wider adoption by opening their technologies for decentralized application (dApp) development. Interest from businesses has even brought out renewed effort from other players to improve their BaaS solutions. Jelurida, the group behind the pioneering proof-of-stake blockchain platform NXT, is now working on Ardor – a new project that is aimed at addressing blockchain’s scalability concerns for business users.

The availability of all of these platforms gives organizations more compelling reasons to use blockchain.

The blockchain bandwagon

Mainstream coverage of blockchain has been non-stop thanks to the skyrocketing prices of cryptocurrencies. IT decision makers (ITDMs), even those in non-tech companies, probably have already had the unsavory experience of fielding questions regarding the technology and how should it matter in their respective companies.

Just about any company could find use in blockchain’s ability to keep immutable and transparent records. However, certain expectations have to be managed. Leadership must be clear about what advantages and benefits blockchain could bring. It’s also important to underscore that blockchain can offer much more than cryptocurrencies and ICOs.

Other factors such as compliance and regulations must also be considered. Issues that have hindered cloud adoption may also become similar problems with blockchain. For example, certain use cases may require data to be hosted within a particular jurisdiction and this can be an issue given blockchain’s distributed infrastructure.

Still, ITDMs must rise to the challenge of providing a clear assessment of their situation. Dismissing blockchain as a fad can result in the company missing out on the other many benefits of blockchain. Companies must also comprehensively evaluate the practicality of implementing the technology and define in which business areas should blockchain be used.


It’s amazing to see how many verticals blockchain startups have already sought to disrupt. Surveying the hundreds of ICOs that were held over the past year, one would notice the diversity of industries that these projects seek to influence. These have shown that blockchain can transcend financial services and find a place in verticals such as the arts and entertainment.

Blockchain smart contracts offer businesses the benefits of automation and efficiency. They could be used to facilitate placement and fulfillment of orders and even take over legal documentation requirements. The technical barriers to implementing blockchain are also getting lower as a number of ventures now focus on addressing specific business concerns.

DealMate, for instance, allows the creation of escrow smart contracts on the Ethereum platform using a straightforward form on a web browser. Waves allows businesses to easily implement create and use their own cypto tokens which in turn allows companies to readily hold ICOs. Stellar Lumens focuses on providing distributed payments capabilities to organizations.

These are just several of the many BaaS projects that have been recently cropping up. More are expected to emerge as the need to serve enterprises becomes clearer.

Speed and scale

Ethereum may currently be platform of choice of many developers to build their own dapps. However, there have been growing concerns regarding its saturation and scalability – something that Ethereum’s own development team has been working to address. Several solutions to scale are already being pushed including shifting the chain’s consensus algorithm from proof-of-work to proof-of-stake.

At its best so far, the network could handle around 10 transactions per second but the platform is currently now being used by nearly 900 dapps. Some are worried that a spike in usage of one or several of these other could negatively affect their own service. Chat service Kik is already looking into migrating its KIN token from Ethereum to Stellar after its own efforts were hampered by bottlenecks in the Ethereum blockchain caused by the recent CryptoKitties craze.

Until issues of scale are straightened out by Ethereum, developers and companies may have to explore alternative BaaS solutions. For instance, NEO uses delegated Byzantine Fault Tolerance (dBFT) for consensus allowing it to avoid the scale issues suffered by blockchains using proof of work.

Jelurida also recognizes the need for businesses to anchor their blockchain efforts to a secure and scalable platform. Ardor improves upon its NXT platform to provide a more scalable and customizable BaaS solution. Central to Ardor is its child chain technology. A business using Ardor could customize its own child chain to keep its data separate from other organizations’ data on the blockchain. Child chains are still validated by all nodes on the network and can be pruned at a scheduled time. This reduces bloat on the main chain.

Drafting a strategy

The great thing about the rise of BaaS is that companies now have more options and choices on how to proceed with blockchain adoption. BaaS providers now range from large enterprise providers to promising startups. Companies could now have an easier time finding a BaaS that would serve their specific business requirements and budgets. At least the issue of supplier availability shouldn’t be a problem.

For businesses and their ITDMs, the key is to have a blockchain strategy in place. The technology offers capabilities such as security of records, payments, and automation that could benefit most businesses. However, it is important to take into account that adopting blockchain may also change the way work is done. Change management and employee education should also be factored into the strategy and not just the technical aspects.

What makes all of these even more exciting is that blockchain is a developing technology. Further improvements are bound to be brought forward as these platforms improve on their capabilities and services mature.