When I first heard about Blockchain, I became extremely excited. I eagerly learned everything about it (unfortunately I never bought Bitcoin in the early stages). To really get the ins and outs, I set up a miner on an old computer, and I began coding my own blockchain. I joined a blockchain development company for a few months and learned about smart contracts, on and off chain transactions, blockchain runners and elastic search on blockchains (I once indexed the whole Rinkeby Network).
Then I set out my shingle as a blockchain consultant, thinking that I would be very successful as an early adopter. My focus was on big enterprise and governments — my previous clients as a technical architect. I thought that the world was full of opportunity, not realizing that the opportunity was for grasping huge disappointment.
I did forty-two proofs of concept for governments and businesses. I cold-called Mary Barra, the CEO of General Motors and got an audience with her directors. Nothing came of it. I have only one blockchain in production, and it is the perfect use case — Certificates of Origin for International Trade. But get this — it is a private, permissioned blockchain.
What I quickly found out, was that every company that I approached said that there was no frigging way that any of their transactions and metadata would ever appear on a public blockchain. It was like lifting your skirt and dropping your drawers for the competition to see your business. Business is the last venue of warfare for civilized men to act uncivil with utter abandon. Even the smallest amount of data could have great inferential value to an avid competitor. The chief flaw of corporate blockchain was one of the factors that I had been promoting as a blessed feature — transparency. I had the same disappointment that one has in their parents when they are in their teens. More importantly, I wasn’t making any real money. I did get funded the odd time to produce a proof of concept, but when the POC was unveiled, it didn’t offer enough of a value proposition to go full corporate. It added a lot of complexity without a sufficient ROI (Return On Investment),
But since then, I have both wittingly and unwittingly seen the future of blockchain. The wittingly part was when I was frustrated at not selling the damn thing to my clients. I sat down and looked at the area of blockchain were corporate America might be interested in, and that was asset digitization. After a consultation by a noted economist, the picture became clear that asset digitization needed something that computer science had known about for a long time — Polymorphism. So consequently I filed a patent application for polymorphic tokens and that resulted in a few more filings with more claims, as the power of that concept became apparent. That story is unfolding as we speak.
But unwittingly seeing the future of blockchain, came only after (a) I had created an incarnation of it and (b) my web scrapers and AI tools picked up an article that made me realize what I had done. It was and is the future of blockchains in the corporate milieu.
The trouble with conventional blockchain is that traditional blockchain proponents take a one-size-fits-all approach. It’s wickedly untrue in the real world. Nothing, not even diapers, are a one-size-fits all. Ethereum can’t be everything to everybody. Bitcoin is only that to people who use it for crime.
But blockchains have another problem: Quote: “In blockchains generally, there’s a strong incentive to identify the most valuable transactions and submit them ahead of other transactions at a higher price, in part because that’s how consensus solutions are compensated.” This results in leakage of Maximum Extractable Value. (Maximal extractable value (MEV) refers to the maximum value that can be extracted from block production in excess of the standard block reward and gas fees by including, excluding, and changing the order of transactions in a block.) This isn’t optimal for business, except for the business of operating a blockchain. A small transaction with minimal value in blockchain terms, can have major consequences in the realm of real-world business, especially in the time domain. But for the leakage of MEV, the leakage could be a source of revenue. Blockchain maximalists have not come to realize this.
So what’s the answer? It is called appchain — a blockchain built specifically for an application. I did this unwittingly for my Certificate of Origin Blockchain that I coded from scratch. In my experience an appchain must have the following features:
it must be a permissioned blockchain not to leak transaction data to the competition
it must be data-centric
it must offer value of a field pertinent to guaranteed, immutable trust
it must be fast, possessing an ability to process transactions as fast as a database
it must offer a value proposition over a conventional database in terms of trust, immutability, security and transparency to the permissioned parties
it must prioritize business processes over blockchain processes
it must have an demonstrable ROI or Return on Investment.
Let me quote an entire paragraph from the article that my web scrapers found:
Another way to look at the economic aspects of running your own blockchain is the potential to create cost efficiencies, in much the same way that traditional application models evaluate developing features in house instead of paying for API calls to third parties. An application-specific blockchain also eliminates competition for resources away from everyone else using the chain, which means all transactions on the chain are directly associated with the activity of the applications users. In theory, this translates to better application performance, which in turn translates to a better user experience.
I honestly believe that if blockchain is to take off in the corporate world, appchains are the way to go. My experience has demonstrated it.
The article that spawned this post mentions a specific blockchain. I do not necessarily endorse the product mentioned in the article nor do I negatively view it. My experience is that a custom appchain, written for a specific customer offers the most value.
Here is the URL to the article:
https://thenewstack.io/are-application-specific-chains-the-future-of-blockchain/
Why You Are Not Making Money As A Blockchain Consultant
Why not just use databases and hooks then?