What is Blockchain-as-a-Service & its Business Benefits?

The real-world applications of Blockchain are expanding by the minute. It has extensive real world applications and benefits but the digital businesses are still struggling to leverage the true potential of Blockchain solutions. Now there are two possible questions that stand in front of business owners. 

• Is Blockchain-as-a-service a workable solution? 
• Is Blockchain-as-a-service for business the answer of how to make Blockchain technology accessible to an audience?

In this article, we are going to look into the BaaS solution for business works, the benefits of blockchain as a service, and how to choose the best BaaS providers operative in the market today.

What is Blockchain-as-a-service?

For offering the benefits of Blockchain based services to a wider audience, the technology has started being offered in the cloud as a service business model. On the operational front, it is more or less similar to the SaaS, PaaS, and IaaS models which enables using cloud-based apps and storage.

It allows businesses of all types and sizes to access Blockchain based technologies without investing in the in-house development. The BaaS model enables companies to access the Blockchain provider’s service wherein they can develop Blockchain applications at minimal cost. This benefit is what has made it a key part of the Blockchain technology trends.

The only limitation of the BaaS solution for business is that it asks for a certain level of centralization since the transactions have to be funneled through the host’s Blockchain services. And because the answer to how Blockchain is used in business lies at the center of decentralization, companies tend to be wary of its adoption.

Key takeaways:

• Blockchain-as-a-Service is third party cloud infrastructure and management that businesses use for developing and managing Blockchain applications.
• It operates as a web host which runs an app’s backend.
• BaaS acts as a catalyst which leads to widespread adoption of Blockchain technology.

How Does Blockchain-as-a-Service Business Model Work?

Blockchain-as-a-service business model describes the process through which third parties install, host, and maintain a Blockchain network on the behalf of organizations. The service provider offers the setting up of Blockchain infrastructure and technology in return for fees.

In many ways, the role of Blockchain-as-a-service for business is similar to that of a web hosting provider. It enables customers to make use of the cloud based solutions for developing and hosting Blockchain applications and smart contracts in the ecosystem managed by the provider.

Here is a visual showcasing the working of Hyperledger Cello Blockchain-as-a-Service, which is a BaaS-like Blockchain module utility system and toolkit under the Hyperledger project.

The BaaS integration in traditional business provides support around allocation of resources, bandwidth management, data security features, and hosting requirements. The biggest impact of BaaS on business is that the enterprises can concentrate on their main business without thinking of the complexities around Blockchain operation.

How Blockchain-as-a-service is Shaping Businesses

According to MarketsandMarkets, the global BaaS size is expected to grow to USD 11,519 million by 2026 which is a fortune for modern enterprises. Blockchain-as-a-service is exclusively shaping startups and SMEs that are highly dependent on large data silos. BaaS comes with the package of smart data protection and competitive advantage, not to forget the expelling third party delegates part. This acts as a benefit over cost. Coming back to BaaS in the market, below are the global figures.

Businesses and consumers are adapting to Blockchain technology. However, the operational overhead cost related to development, configuration, operation, and maintenance of infrastructure along with the technical issues act as a barrier. The advantages of Blockchain for SMEs, no matter how massive, are very resource intensive and energy consuming – thus preventing the technology’s mass adoption.  

Renting a Blockchain infrastructure in BaaS allows businesses to acquire the skills needed for operating the Blockchain infrastructure. Additionally, the investment needed for entering the technology segment is also lowered, since the service agreement can be easily scaled up or even terminated within short notice. 

It offers a way for businesses to stay at the edge of technology without any unnecessary risks. 

BaaS for startups

The opportunities of BaaS for businesses, especially small businesses, is deemed ideal for organizations which outsource the technological aspects, and are not very hands-down involved with the Blockchain’s working mechanism. It enables these firms to get the understanding of the technology without having to develop their proprietary Blockchain. 

The integration of BaaS solutions is being used by a number of industries for things like identity management, supply chain management, and payments. Blockchain development services are emerging as the ideal solution for a number of SME challenges like elimination of middlemen, lack of transparency, etc. 

Industry wise use cases of Blockchain-as-a-service 

As we mentioned above, Blockchain is a data management platform which means all the solutions offered in the territory of Blockchain  will have data keeping to their center. The use cases explained below exhibit how Blockchain is utilized by different businesses for immunity and transparency purposes. 

1. Healthcare 

Blockchain has revolutionized healthcare upto a great extent by keeping a universal and transparent version of patients medical data. Blockchain technology has helped several medical professionals to provide instant care to the individual patients due to organized and updated records. 

Besides, Blockchain also aids in identifying the authenticity of medicines. This means any drug or chemical can be checked to its source. This has been a great benefit for manufacturers recalling particular chemicals for aid drugs. 

2. Automotive 

The biggest challenge for automotive industries is to resist counterfeit parts and manage supply chains. Blockchain platform as a service rescues here by offering end-to-end accessible records for transporting automotive parts. This helps the automobile enterprises track and differentiate genuine spares from fakes. 

Moreover, Blockchain services in supply chain and manufacturing have disrupted the efficient flow in the industry. There is no shortage of vital parts and businesses get optimal production with minimal setbacks. 

3. FinTech 

Blockchain in FinTech has brought peace to every average banking customer by making most of the financial process effortless, including AML and KYC verification process. Besides adding immutability and transparency to prevent disputes. Blockchain services have introduced smart cards to customers. These smartcards help in faster settlements of funds without the verification by any central authority.

4. Transportation and logistics 

The logistics and transportation industry relies heavily on identity verification for goods and passengers respectively. With a single identification token, the entire process gets easy and quick for passengers. Similarly for cargo movement and verification efficiency and fault proof. 

Blockchain platform as-a-service provides a fail-safe mechanism for industries and various other data silos. 

Apart from the industry specific use cases, you can also use Blockchain development services for general purposes such as: 

5. Document tracking 

Blockchain technology offers a distributed, immutable document tracking system. By keeping the documents on Blockchain, all the participants are given equal access to the information. Additionally, Blockchain technology is immutable, thus ensuring that the documents are secured.

6. Data storage 

With the data stored in the decentralized Blockchain, the amount of data loss risk is reduced by manifold. The regulated industries like healthcare, real estate, etc benefit a lot from this immutable, secure facility of data storage on Blockchain.

7. Contract execution 

Under the smart contracts service of Blockchain, a platform is provided for the contract execution which promises high transparency levels. Its distributed nature implies that all the parties should be equally informed.

The benefits of Blockchain infrastructure as-a-service lies in the unraveling of the several use cases that are yet to emerge. It offers enterprises an opportunity to work on those blockchain real-world use cases without making any large term commitments. All they would have to do is partner with a Blockchain service company and then fully embrace Blockchain’s capabilities.

Now that we have looked into how Blockchain platform as-a-service is valuable for SMEs and enterprises, let us look into its regional adoption.

The Region Wise Adoption of Blockchain-as-a-service

The worldwide market of BaaS is big around the US, Mexico and Canada. One prime reason behind this is the presence of SMEs and large businesses operating in the US location along with a willingness to combine the technology with the public utilities services.

Europe has also been seen as the leading BaaS market. One of the major drivers of Blockchain and BaaS adoption has been the government support from different countries.

The Asia Pacific (APAC) region is the third-most biggest market for BaaS integration. Driven by the BaaS integration in traditional businesses and growing investment in Japan, China, and South Korea, the technology is poised to grow in the region.

To take the adoption of Blockchain platform as-a-service for business further, a number of tech companies have emerged as BaaS providers. Here are a few of them:

The Top Blockchain-as-a-service Providers

[Read: How to Choose Blockchain-as-a-Service Provider?]

A Look Into the Alternative – Self-hosted Blockchain

Up until this point, we have looked in the BaaS ecosystem and how Blockchain infrastructure as-a-service is influencing the small business, in addition to the list of top providers. While it all suggests that it is a good option to go with this approach, businesses can in fact lose out on the essence of decentralization – the foundation of Blockchain fundamentals.

So what is the alternative? The answer is Self-Hosted Blockchain.

When we talk about the Self-Hosted Blockchain app cost, the ownership amount tends to be a lot higher because of the startup costs, retirement costs, and operational costs. Moreover, the amount of developing and deploying a smart contract under this model can amount to up to hundred thousand dollars or more.

In contrast, a Blockchain app hosted on cloud as a BaaS offering can be around $0.29 per allocated CPU hour. This means, businesses would only have to pay as they go and only for the service units used.

While we are talking about choosing Blockchain services, you must also consider checking “How to choose a Blockchain platform that speeds your growth”. 

If you are worried about the cost factor, The costs of the BaaS model vary on factors such as number of concurrent transactions, transaction rate, and the payload size on transactions, etc. However to get a specific range and understand Blockchain development services, you can check out, “how to determine Blockchain app development cost”.

How can Appinventiv help you with Blockchain development services?

Appinventiv is a Blockchain development company with profound knowledge and experience in developing and managing decentralized solutions. Here, the Blockchain experts serve you with a wide range of decentralized solutions that adds scalability, security and transparency to your ecosystem. 

Allow us to help you with top tier BaaS solutions aligned to your business needs. Contact our experts for personalized suggestions.

THE AUTHOR

chirag

Blockchain Evangelist