Why Blockchain Technology Give Us Uncanny Hope?

Sensing the blockchain enthusiasm in the corporate circle, I had this confusion.

We discuss one of the aspects of blockchain is its ability to be a distributed entity. Then, why are companies becoming enthusiastic about this tech, if this is a technology with no controlling entity?

If you felt this way, read on…

There is this division called permissioned and permissionless blockchains.

As you can see from the names, permissioned blockchains have a controlling entity in place whereas permissionless doesn’t have any.

All the companies that use blockchain technology are utilizing the benefits of this tech by keeping them as the controlling entity. It is a closed ecosystem, where anyone interested in viewing data on the network or validating transactions needs approval from the controlling entity.

Most of the cryptocurrencies we have today come under the permissionless list. Anyone can join the network and view the data. Also, we can be anonymous on the network and never have to reveal our identities to do transactions.

There are some major aspects why businesses are adopting this tech.

1. Customised Transparency

Businesses handle an extensive amount of data about the transactions and operations of their users, and that has to be kept securely.

In healthcare, this can be the patient data that has to be kept highly confidential.

By using this tech, businesses have the option to choose the level of transparency they need for their efficient operations.

You can customize the amount of privacy on a user-case basis. This allows us to take advantage of the vast amounts of data and to keep them secure at the same time.

2. Customised Decentralization

Since companies themselves are the central authority on a permissioned blockchain, they can determine the degree of centralization they need.

As we have seen before, we need a consensus algorithm to keep the network secure and operational. Here, the companies can decide what kind of consensus algorithm works best for them.

3. Access Controls

Permissioned blockchains are indeed private blockchains.

Blockchain tech enables the central entity to provide varying degrees of access to different nodes on the network.

For example, a data analyst in the company might not need access to the type of data a CEO needs. This type of blockchain enables us to control this access much easier than the traditional methods.

In essence, permissioned blockchains enable the companies to access the potential of this tech without compromising control.

In short, companies decide the terms and conditions here as the central entity.

There are indeed limitations that come along with the aspect of a central entity in permissioned blockchains.

It provides less anonymity for the members and is also less transparent, unlike permissionless blockchains.

I love the customizability this technology provides, without compromising on data security.

We’ll see the major aspects of permissionless blockchain that is the underlying concept for most cryptocurrencies in a later post.

There are indeed certain limitations to this tech currently like any new tech in its beginning stage.

I believe things will evolve as we keep using the feedback loop.

I would love to hear your thoughts on this.