Amazon’s Blockchain as a Service (BaaS) solutions could bring the next breakthrough in blockchain adoption. ConsenSys, leading Enterprise Ethereum venture, talked about the blockchain solutions by leading cloud solutions company AWS, which is partnering with Kaleido to offer a new suite of DLT-based services to their users. Amazon is already offering 125 services, including the most comprehensive cloud infrastructures in the world.
Amazon Responds to the Demand of Enterprise Blockchain
Amazon is known for its customer-centric approach and prioritizes business and service according to user demand. With its entry into the enterprise blockchain business, the writing appears clear on the wall. According to Gartner, the business value-addition of blockchains will be worth over $3.1 trillion by the year 2030. This valuation could be fueled by the entry of big tech into space.
During the re:Invent 2018 conference, Amazon announced its managed blockchain service as well, signaling the company’s seriousness towards the DLT systems. This offering is also important as it will help more businesses offset the initial barriers to entry into blockchains and explore the benefits of the network while staying in familiar cloud environments.
But this is not all that Amazon has to offer. The company is working in partnership with R3 and Kaleido, a service tied to ConsenSys to provide blockchain SaaS solutions to its users. AWS already offers its own iteration of blockchain templates for basic blockchain work. Now the Amazon Managed Blockchain service will help Amazon up the ante and join the league of Microsoft, SAP, and IBM.
Amazon’s Latest Blockchain Service Is Unique
The unique thing about the Amazon blockchain service is the Quantum Ledger Database (QLDB), which monitors transactions and application data. This serverless ledger is similar to DynamoDB service and does not require any shared consensus. The database is completely centralized, and users rely on Amazon for the verification of transactions and ledger maintenance.
The Amazon Managed Blockchain works on the Hyperledger framework and helps interested parties in setting up blockchains. Amazon will charge a fee for these solutions. It may add Ethereum based solutions in the future. Kaleido founder and CEO Steve Cerveny said:
“Blockchain solutions have tremendous potential to transform business, but creating the blockchain network is typically only about 5–10% of a complete solution.”
Is Amazon Doing Enough?
While the steps taken by Amazon are definitely in the right direction, they only form a small piece of the larger blockchain puzzle. The private, centralized blockchain-based solution and the larger, public blockchain solutions have unique needs. What sits in between is Enterprise Ethereum- one of the leading DLT solutions based on Ethereum.
To bridge the gap between the two, AWS will depend on ConsenSys. It would be helpful specifically for IPFS, identity registry, hardware wallets, smart contracts, oracles and more. The full stack solutions offered by Kaleido, a ConsenSys company, will be helping in the same. It provides full-stack SaaS for creating, operating and scaling enterprise blockchain solutions. It also offers click-button deployment, removing 80% of the custom code.
Kaleido’s solutions are being used by 1500 blockchain networks which contain 150 million blocks with over 4000 nodes. About 30% of the largest banks in the world and leading companies are using these solutions. More interestingly, Kaleido is offering its services for free on the AWS Marketplace. They could also be found on the Kaleido website.
AWS General Manager of big data, data lakes, and blockchain Rahul Pathak commented on the solution, saying:
“Kaleido is working with us across a number of other areas, their focus is bringing their own service to AWS customers.”
He also noted that he didn’t believe the services will contradict with those of Ethereum, expressing hope that the customers will have the choice to use either of them or both of them in the future.
What All Does Kaleido Offer To AWS?
The following services will come as a part of a full-stack package offered by Amazon to its users, powered by Kaleido.
IPFS file storage
Blockchain networks need to store large files across multiple nodes, but they are not designed to hold and process these files. Therefore, organizations need a shared infrastructure where files could be uploaded and quickly retrieved. This is done via IPFS, a P2P censorship-resistant file sharing technique that lets you upload a file and then retrieve it when needed using a referencing hash. No single user can delete a file.
Enterprise blockchain networks also need to be verified on-chain identities while connecting them to their organizations. These identity management platforms also help in keeping members of a consortium in the know about which entities are their business counterparts. Kaleido depends on a public key infrastructure (PKI) which allows organizations to issue x509 certificate chains. These certificates can be downloaded by other organizations as proof of authenticity, trust, and authority. Eventually, these entities will get connected to designated Ethereum addresses, binding organizations to their transactions. The ID registry comes with cryptographic checks to avoid frauds as well.
Identity Masking HD Wallets
The blockchain network needs identity masking HD wallets to ensure privacy in enterprise information while submitting transactions. These wallets come with deterministic key tree and offer access to an unlimited supply of private signing keys. They allow users to send and receive transactions on a network with random untraceable identities depending on need by need basis.
While Ether (the native digital asset of the Ethereum blockchain) is needed for the public blockchain, it doesn’t serve a purpose in private and permissioned implementation of Ethereum. However, having the token in the network could help in adding some extra layers of versatility and flexibility to the use cases of the blockchain. For instance, it could be used for mapping fungible assets or fiat or impose costs wherever necessary. Every Kaleido environment comes with an Ether pool to facilitate these transactions if necessary. The members of the consortia will be free to use these coins as they please.
Blockchains aren’t every organization’s’ cup of tea and leveraging the varied and complex framework of Ethereum while maintaining its heavy client library could demand deeper blockchain expertise. To handle this problem, Kaleido comes with an Eth-Connect bridge, a messaging layer that makes transaction submission much easier. The transactions on the network can be submitted as basic JSON payloads, which are common with legacy applications available on the market. These can be integrated easily with Kaleido, and the organizations are saved from working on heavy libraries which makes blockchain even easier to adopt. The bridge also manages to handle the periodic surges and peak transaction periods by sticking to an optimal rate of network injection.
Client Services Integration
Client services, smart contracts, and oracle networks need to be connected to the blockchain in an open, easy and fast manner. Kaleido makes provisions for such additions as well.
For instance, Open Law application allows for easy creation and fast execution of legal agreements. The agreements are created and managed automatically, complete with signature management and the transfer of blockchain-based digital assets in such a way that it becomes legally enforceable. The service is hosted on Kaleido and is configured automatically when needed.
Another such service is Chainlink, an open sourced and decentralized oracle which adds external data to Ethereum smart contracts. It creates the scope of adding real-world events, APIs, outside applications and even other blockchains to the Enterprise Ethereum systems.
What If Customers Work With Multi-cloud Structures?
There is no dearth of companies that prefer multi-cloud setups instead of relying solely on AWS. The problem here is that the AWS services, including its cloud management service and analytics, exist in a silo. The problem is similar to what other legacy companies like Oracle and SAP face. Their networks and information to exist in a silo, which creates a highly centralized infrastructure that some organizations shy away from. Though there are no proven ways to solve this problem, there is a huge gap in demand and supply in this specific sector which will hopefully be met in the future.
Enterprise Blockchains Have Unique Needs
Interestingly, businesses are evolving much quickly now which means that the demands of the customers will increase manifold and there will be several new problems seeking solutions within the Enterprise Ethereum infrastructure.
Despite the rapidly changing ecosystems, large organizations cannot move as fast in innovation terms simply because of their size and the sheer number of resources they must put to use to make things move. The new generation of BaaS service providers has to be innovative while understanding how large organizations work, giving them time and space to evolve.
The final yet the most important part of this evolution will be governance rules. Steve Cerveny, founder, and CEO of Kaleido puts the problems faced by enterprises in blockchain into perspective, saying:
“What really makes blockchain so much harder for companies is the reality that the management of the network is shared by the participants. We call that ‘Shared IT’ and many organizations don’t see it coming until they are way down the path with their project.”
He added that the real challenge could lie on getting every participant, even competitors onboard and decide important details like how the system will be built. The good news is that awareness for blockchains is increasing and we may soon see better adoption.