Businesses are always operating with external organizations and markets. These business networks are fundamental to the operation of blockchain in this environment
These networks consist of transferring of different types of assets
Tangible
Intangible
Cash
Ledgers are the key to recording the flow of assets through an organisational network, and these flows are governed by contracts which can be simple or complex
At a very high level Blockchain is a distributed ledger with a shared set of business processes across the network
The Problem Area
Every member of the business network has their own copy of the ledger, and this is updated each time an asset flows through the network, this system is inefficient, expensive, and vulnerable to mistakes or even fraud
By utilising Blockchain, each member utilises a shared ledger, but we just specify which users are able to see which specific transactions are relevant to them
When we use this we end up with
Consensus
Provenance
Immutability
Finality
Based on this we have a single source of truth for all parties and transactions within the network
Requirements in a Business Environment
Blockchain in a business environment requires four main components
Shared Ledger
Smart Contract
Privacy
Trust
Shared Ledger
Each participant has their own copy which is shared between them, this is based on permission and control. This becomes the shared system within the network
Smart contracts
Encoded version of business contracts. These are verifiable, and signed. Once these are distributed the contract will execute one the conditions are met.
Privacy
Participants need confidentiality within the blockchain, as well as a system in which transactions must be authenticated and immutable
Trust
Selected members endorse or validate transactions, once these are endorsed they are added to the blockchain. This gives us a verifiable audit trail, transactions cannot be modified in any way once they have been added