Betting on blockchain – the smart money is on Azure



Betting on blockchain - the smart money is on Azure

Unless you have been buried under a rock on Mars or been on holiday – maybe ice skating on the frozen water at one of the Moon’s poles? [1] – you know that cryptocurrencies such as Bitcoin are a hot topic with the potential to make you a millionaire (or lose money if you invest at the wrong time).

Ten years with blockchain

2018 marks the tenth anniversary of when a mysterious and so far anonymous Satoshi Nakamoto published his(/her/their?) paper “Bitcoin: A Peer-to-Peer Electronic Cash System” [2] and started a financial revolution with a new digital currency.

Now there are more than 1800 cryptocurrencies [3], and a whole new alternative financial ecosystem has been established.

the Redmond-based software giant began offering Ethereum Blockchain as a Service (ETH BaaS) on Azure

While cryptocurrencies are getting most of the attention, the underlying technology in the form of blockchain technology has more potential than ”just” being the foundation for cryptocurrencies.

Not only cryptocurrencies

For instance, there’s a number of companies that are exploring how to use blockchain technology to improve various industries’ supply chain [4], and it has even been suggested that blockchain can save democracy [5] (It can’t. If the problem is political a technological fix can’t solve it).

Blockchain is a distributed database which uses cryptography or, as Microsoft describes it, “a shared, secure ledger of transactions distributed among a network of computers, rather than resting with a single provider”. Microsoft has been involved with blockchain for technology many years and launched its blockchain initiative back in 2015 [6].

Microsoft pushing blockchain technology

In the last couple of years, Microsoft has further enhanced its involvement in blockchain technology, and the company is often mentioned as one of the most important companies [7] when it comes to building and experimenting with blockchain technology [8].

Recently, the Redmond-based software giant began offering Ethereum Blockchain as a Service (ETH BaaS) on Azure [9]. That’s quite a mouthful. What is Ethereum?

Smart contracts and applications

Vitalik Buterin described Ethereum in December 2013 in his paper “A Next-Generation Smart Contract and Decentralized Application Platform” [10] and, as the title suggests, it’s the next generation of blockchain. It adds the concept of Smart Contracts and Decentralized Applications to the blockchain so that developers can create blockchain-based applications.

In May 2018, Microsoft released the Blockchain Workbench, which, according to the marketing blurb, makes it possible to “build applications in days, not months” [11]. Naturally, some may ask “what kind of applications – production ready or proof-of-concept?”… that would obviously depend on a number of factors.

Smart Contracts in C, C++ and Rust

According to Cody Born, Software Engineer at Microsoft’s Azure Global, many enterprise developers mention the Solidity language as one of the largest pain points when developing smart contracts and distributed apps on Ethereum. From the beginning of August 2018, it became possible for developers to author smart contracts in familiar languages such as C, C++, and Rust.

This is part of the new Ethereum Proof-of-Authority on Azure [12], which has another very significant improvement besides better language support.

Costly mining not necessary in Enterprise Applications

Cryptocurrencies are using a proof-of-work algorithm to validate transactions on the blockchain in a so-called mining process [13]. This requires a lot of CPU/GPU-resources and makes the blockchain-system less scalable [14]. For enterprise applications, it is possible to use a much more efficient Proof-of-Authority algorithm where approved individuals have the right to validate transactions without the need for the costly and time-consuming mining process.

This is a very important addition to ETH BaaS on Azure which will consolidate Microsoft’s position as a leading blockchain company.

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LINKS

[1] Water Ice Confirmed on the Surface of the Moon for the 1st Time!
[2] Bitcoin: A Peer-to-Peer Electronic Cash System
[3] All Cryptocurrencies
[4] How Blockchain Will Transform The Supply Chain And Logistics Industry
[5] Can the Blockchain Save Democracy?
[6] Microsoft and Blockchain
[7] 20 Top Blockchain Companies
[8] Companies Ahead Of The Game In Blockchain Technology
[9] Ethereum Blockchain as a Service now on Azure
[10] A Next-Generation Smart Contract and Decentralized Application Platform
[11] Blockchain Workbench Preview
[12] Ethereum Proof-of-Authority on Azure
[13] How a Bitcoin transaction works
[14] Bitcoin scalability problem

Dan Mygind

Author: Dan Mygind

Dan is a Journalist and Computer Scientist with a strong interest in technology, technology-related businesses, and the transforming effect source code can have on society.
He has worked for startups, SMEs and global IT-organisations such as IBM as a developer, consultant, and IT-architect. With a solid technology background, he has written extensively for a wide variety of publications such as Computerworld as well as writing technical white papers for Microsoft and other companies.
He is also a published author, ‘World Storytellers

Contact Dan Mygind: mygind{at}writeit{dot}dk

The views expressed are those of the author and do not necessarily reflect the view and opinion of Curo Talent.

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