The emergence of blockchain solutions has ushered in a new realm of industrial revolution. The technology has witnessed a massive influx of new innovations and developments that have been created to sustain the growth and development of the blockchain ecosystem. The promising potential and impressive growth of the technology has attracted the interest of a number of organizations towards the adoption of blockchain in their operations. However, while blockchain is not a new technology, the technical complexities and cost involved in the development, operation and maintenance of a blockchain infrastructure, make it quite difficult for organizations to find a feasible way to apply blockchain. Too address this issue. A new kind of model, known as Blockchain-as-a-Service(BaaS), was created to enable organizations adopt the use of blockchain in their operations without investing heavily in the necessary infrastructure and technical expertise required to provide them a fully functioning blockchain solution.
What is Blockchain-as-a-Service(BaaS)?
Blockchain-as-a-Service(BaaS) is analogous to Software-as-a-Service. It refers to a kind of service offering that allows customers to leverage cloud services to develop and host their own blockchain applications, smart contracts and other functions on the blockchain, while the cloud-based service provider manages all the activities required to keep the blockchain infrastructure functioning efficiently.
Why Do Organizations Need Blockchain-as-a-Service(BaaS)?
Building and maintaining a fully functional blockchain requires a certain level of technical expertise in order to handle the technical complexities involved in the process. These complexities, coupled with the cost required to develop a blockchain and maintain the infrastructure, often pose a significant barrier to the adoption of blockchain for so many organizations. With Blockchain-as-a-Service, this barrier could be entirely eradicated.
Leveraging Blockchain-as-a-Service helps businesses reduce the cost of adopting blockchain. For companies that lack the technical expertise and understanding on how to develop, operate and maintain blockchain solutions and infrastructure, BaaS will relieve them of the cost and efforts associated with outsourcing the technical aspects of integrating a self-hosted blockchain.
For organizations that are interested in integrating blockchain in their operations but lack the resources to develop it in-house, all they need to do is to leverage Blockchain-as-a-Service (BaaS) and enjoy the several benefits that blockchain has to offer their organization.
Pros of Blockchain-as-a-Service(BaaS)
- It Saves Cost
Traditional self-hosted blockchain solutions cost far more to develop and maintain in comparison to BaaS. The significant cost difference between the two blockchain alternatives makes BaaS a very suitable alternative for businesses that cannot afford to develop and maintain a self-hosted blockchain. BaaS helps such businesses enjoy the benefits of blockchain at a reduced cost.
- Reduced Risk
BaaS facilitates quick deployment and testing of blockchain solutions. This enables businesses to easily test whether a blockchain is suitable for their business needs, without any huge upfront investment. This, in turn, reduces the risk associated with putting out new blockchain-based business innovations.
- Secure Infrastructure
Credible cloud service providers have large investments in resources and datacenters that offer more powerful capabilities than most businesses can afford in-house. This ensures that a BaaS infrastructure is extremely secure and highly efficient.
Cons of Blockchain-as-a-Service (BaaS)
A major reason for blockchain’s hype is its decentralized nature. However, with BaaS involving the hosting of a blockchain in a single cloud service provider, centralization is created to an extent. This prevents the blockchain solution developed from being completely decentralized.
- Restricted Control
Since the blockchain infrastructure is controlled by the cloud service provider, the organization(customer) experiences a limited control of the backend infrastructure. This leaves the organization with just the power to manage the blockchain without being able to control how the entire system functions.
- Risk Of Shutdown of A Cloud Service Provider And Difficulty Migrating To A Different Vendor
With BaaS, an organization will rely on the third-party cloud service provider to ensure the continuous operation of their blockchain. However, the business world is dynamic and circumstances can lead to the shut down of the business of the cloud provider handling an organization’s blockchain infrastructure.
In cases where an organization chooses to switch to another cloud service provider, the organization’s blockchain will experience interruptions for the period of time required to make the transition, hence adversely affecting the operations of the business.
The Future Of Blockchain With BaaS
The Blockchain-as-a-Service market is expected to grow exponentially within the next five years. With BaaS, blockchain will be available for adoption to enterprises of any size, thus, widening the global adoption of blockchain.