In 2017 there was a real “run” on information about Bitcoin and Blockchain, the number of search queries increased by several 100% in each case. The value of all crypto currencies – in addition to Bitcoin, by far the leading crypto currency, there are more than 1000 other crypto currencies – increased fortyfold within a year, not a few reminded of the time of the gold rush in the 19th century.
In the meantime, the excitement around the account currencies has calmed down, the clearly overheated market capitalization of all crypto currencies at the turn of the year 2017/2018 (at the beginning of January this was an amount of more than 800 billion USD) has decreased to a value of a little more than 200 billion USD by the end of September 2018. This may look like a real crash, but on the one hand the market for crypto currencies is traditionally very volatile and on the other hand this USD 200 billion still means an increase of more than 1,000 % compared to the value at the beginning of 2017.
In addition to the crypto currencies, the possibilities of the blockchain technology on which the crypto currencies are based are increasingly becoming the focus of interest. Because: with the ingenious combination of different technologies, which today is called blockchain, it is possible to transfer values directly and securely from one point to another via the Internet without the use of intermediaries. And, of course, this is of great interest especially in the business world.
Bitcoin was the first application to use blockchain technology, and in the meantime the technology field has developed and professionalized at an extreme speed. An important step for the development of the technology field was the launch of Ethereum in 2015. So-called Smart Contracts offer extended possibilities to automate business processes and thus make them safer, faster and more efficient.
Ethereum today has by far the largest developer community, and many companies have successfully completed initial tests and prototypes. It is expected that in 2018/2019 the number of Ethereum-based enterprise applications will increase significantly.
There are several very promising further developments in the blockchain area, which will successively solve the still existing challenges of blockchain technology (e.g. transaction volume and speed). At this point, however, we will not go into this further development.
Bitcoin and Ethereum are so-called “public blockchains”. With public blockchains, there are no access restrictions – anyone who wants to can write and read data in the distributed system. This is called “permissionless” – i.e. without access restrictions. This blockchain type is considered the safest way to store data unalterably.
But this publicity is rejected for many business applications, understandably not everyone should be able to see who does which business with which company. Against this background the variant of an “Enterprise Blockchain” (also called “private blockchain” or “permissioned blockchain”) was developed. Here, access rules and procedures are defined according to the desired procedures, so there are – unlike with public blockchains – central entities that define the set of rules. With leading enterprise blockchains, such as Hyperledger, an enterprise blockchain developed within the Linux Foundation, it is also possible to program Smart Contracts.
For many business processes, the possibilities of the Enterprise Blockchain are completely sufficient; in principle, one can synchronize data stocks securely and automate business processes with such systems. However, the security of these enterprise blockchains is not on the same high level as with public blockchains.
In the meantime, very good solutions have been developed for the requirements described above regarding the confidentiality of transactions and other company-specific requirements for public blockchains. Furthermore, the emerging possibilities of the so-called token-based economy, in which various assets in public blockchain systems receive a digital image on a blockchain system, probably cannot be implemented to the same extent with enterprise blockchains. It will be interesting to see which of the two blockchain philosophies will have which part in the corporate environment: the enterprise blockchains following the classical enterprise philosophy or the philosophy of distributed structures and networks of public blockchains.
In the few years since Bitcoin was the first blockchain application to see the light of day in the digital world (2009), the possibilities and relevance of blockchain technology have been explored.