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Enterprise Ethereum: Connecting Ethereum To Businesses

By

Los

Silva

WriterETHNews.com

Enterprise Ethereum aims to supply corporate users with governance and tools to create a private blockchain for adopters seeking to build real world applications.

Last week, rumors began circulating on the internet surrounding an Ethereum project “veiled in secrecy" known as “Enterprise Ethereum”. Crypto websites speculating on the story reported on a group that met at an “underground meeting” December 15, 2016, in New York. Members included former R3CEV personnel, a stock exchange, and a major software provider. Certain attendees of this meeting independently confirmed their involvement, including Nuco, a blockchain project started by three respective members from the Deloitte blockchain team, Taiwanese blockchain consortium Amis, and the Ethereum project powerhouse, ConsenSys. ETHNews reached out to ConsenSys for more details on the new project, “Enterprise Ethereum.”

In a blog published by ConsenSys’ Chief of Staff, Jeremy Millar, a description of Enterprise Ethereum was quickly outlined to dispel any rumors circulating around the project. In the post, ConsenSys describes Enterprise as a “group of builders & doers, developing sufficient governance for enterprise requirements but not ‘death by committee’ and without ‘pay to play’.”

The post explains:

“Enterprise Ethereum will build upon the current Ethereum scaling roadmap and maintain compatibility and interoperability with public Ethereum. In fact, we believe Enterprise Ethereum will contribute significantly to the overall development of Ethereum.” 

Millar states that the blockchain market has already moved beyond the incubation phase and that mainstream enterprises and IT organizations are aiming to tackle novel use cases and complex IT challenges with the technology. Millar acknowledges that IT organizations can be overwhelmed with the complexity of a public Ethereum blockchain and that those same adopters are requesting assistance in building Minimal Viable Products (MVP’s) and strengthened infrastructures for production readiness. In other words, these supporters are no longer seeking proofs of concept (PoC), but rather technical solutions for supply chain tracking, payments, data privacy, compliance, and asset tokenization. Essentially, Enterprise Ethereum would provide the corporate business world answers to the tough questions they currently face.

According to Millar, these are the challenges that blockchain enterprises face:

  1. Ethereum was developed initially for public chain deployment, where trustless transaction requirements outweigh absolute performance. The current public chain consensus algorithms (notably, proof-of-work) are overkill for networks with trusted actors and high throughput requirements.
  2. Public chains by definition have limited (at least initially) privacy and permissioning requirements. Although Ethereum does enable permissioning to be implemented within the smart contract and network layers, it is not readily compatible 'out of the box' with traditional enterprise security & identity architectures nor data privacy requirements.
  3. Naturally, the current Ethereum Improvement Process is largely dominated by public chain matters, and it has been previously challenging for enterprise IT requirements to be clarified and prioritised within it.

In response to these challenges, “many enterprises who have implemented private Ethereum Networks have either ‘tweaked’ or forked open source implementations or have relied on propriety vendor extensions to meet their deployment requirements.” Some examples of these extensions are Hydrachain, Quorum, Parity, and Raiden. However, while extensions are understandable, the downsides are the lack of application portability, code base fragmentation, and vendor lock-in.

Millar notes that this has been “a point of conversation for some months between enterprise technology vendors, corporate users, and Ethereum startups.” Because of these conversations, along with the approval and involvement of Vitalik Buterin, this has led to “the largest corporate users and Ethereum infrastructure leaders collaborating to define a roadmap, legal structure, governance and initial technical developments to define 'Enterprise Ethereum'.”

“By banding together the key adopters, supporters and shapers of enterprise usage of Ethereum, we are seeking to provide a platform not only for the technology but also to provide the governance and tools to create a standard for 'Enterprise Ethereum’.”

For now, this announcement signals a progression of Ethereum’s power and potential to expand into corporate business and mass adoption efforts. The transparency provided by ConsenSys on this matter solidifies Ethereum’s principles of open source innovation that is crucial for the technology to grow and improve. Although the road to popular implementation is still a journey, the development of Enterprise Ethereum emphatically adds fuel to the engine’s fire.

Millar sums up this sentiment:

“Certainly, we are some time away from seeing investment banks fully migrate securities clearing and settlement to Ethereum networks, but we already do see private Ethereum blockchain networks in production, even in financial services.”

ETHNews reached out to Andrew Keys, Head of Global Business Development for ConsenSys, regarding other details of Enterprise Ethereum.

ETHNews: What is the timetable for Enterprise Ethereum? When will it be released?

Andrew Keys: We foresee the public announcement occurring in February but will do so once the stakeholders have all approved moving forward.

E: Why is it important that Enterprise should occur now? Why not wait until Ethereum becomes more mainstream?

AK: Enterprise Ethereum will drive best practices in security, privacy, scalability and other enterprise concerns as well as creating a meet-space for similar types of clients to work together on reference architectures. Moreover, this will help the evolution of Ethereum multi-chain fabrics where business logic can be displayed in a private, consortium, or public Ethereum environment based on the use case. All of this work will be done in support and with the blessing of the Ethereum Foundation. 

E: How is ConsenSys involved with Enterprise Ethereum?

AK: ConsenSys is one of the many organizations that are working towards improving Ethereum in the enterprise setting. 

ETHNews will be following developments on this story. Read the official blog post below:

The Birth of Enterprise Ethereum in 2017

Jeremy Millar, Chief of Staff, ConsenSys

Jeremy began his career as one of the first Java architects at Oracle, before moving into sales management and strategy roles, both within Oracle and at a number of start-ups. He went on to complete his MBA at Oxford University before joining the M&A team at Goldman Sachs. At ConsenSys, Jeremy has multiple focuses within enterprise and product, and is the chief instigator of Enterprise Ethereum.

Enterprise use of blockchain technology has evolved at an almost unfathomable rate over the past 24 months.

From early bitcoin experiments, senior bankers joining start-ups, the launch of the public Ethereum decentralized application platform and the many private, permissioned systems currently under development using the Ethereum technology, to the creation of industry consortia, blockchain has emerged as one of the top enterprise IT trends entering 2017.

The market has already moved beyond the incubation phase where innovators effectively build the technology along with their initial applications, and possibly beyond the early adopter phase too. Increasingly, mainstream enterprise IT organizations are not only educating themselves and experimenting with blockchain but also are aiming to tackle novel use cases and complex IT challenges with the technology. More and more frequently, our clients are asking for assistance building MVPs not POCs, or hardening environments for production readiness.

With this whirlwind, dare we say tornado, of adoption, it is also clear that certain key technologies are emerging as potential de facto standards as blockchain platforms, while at the same time IT organizations can be overwhelmed at the complexity and capabilities of the technology.

Ethereum is arguably, the most commonly used blockchain technology for enterprise development today. With more than 20,000 developers globally, the benefits of a public chain holding roughly $1bn of value, and an emerging open source ecosystem of development tools, it is little wonder that Accenture observed 'every self respecting innovation lab is running and experimenting with Ethereum'. Cloud vendors are also supporting Ethereum as a first class citizen: Alibaba Cloud, Microsoft Azure, RedHat OpenShift, Pivotal CloudFoundry all feature Ethereum as one of their, if not the, primary blockchain offering.

Why? The software is widely available: simply download an Ethereum client, pick your favorite development environment, and get going. Ethereum is general purpose and easy to program: full stack / web developers can pick-up the Solidity smart contract programming language in a matter of hours and develop initial applications in only a few days. Documentation is plentiful, as are code samples, deployment frameworks, and training. Little wonder that so many companies are using Ethereum as their blockchain of choice.

Today, enterprises are deploying private Ethereum networks in or near production in areas as diverse as supply chain tracking, payments, data privacy, compliance, and asset tokenisation just to name a few. Certainly, we are some time away from seeing investment banks fully migrate securities clearing and settlement to Ethereum networks, but we already do see private Ethereum blockchain networks in production, even in financial services.

But enterprises adopting Ethereum face a number of challenges, notably:

  1. Ethereum was developed initially for public chain deployment, where trustless transaction requirements outweigh absolute performance. The current public chain consensus algorithms (notably, proof-of-work) are overkill for networks with trusted actors and high throughput requirements.
  2. Public chains by definition have limited (at least initially) privacy and permissioning requirements. Although Ethereum does enable permissioning to be implemented within the smart contract and network layers, it is not readily compatible 'out of the box' with traditional enterprise security & identity architectures nor data privacy requirements.
  3. Naturally, the current Ethereum Improvement Process is largely dominated by public chain matters, and it has been previously challenging for enterprise IT requirements to be clarified and prioritised within it.

As a result, many enterprises who have implemented private Ethereum networks have either 'tweaked' or forked open source implementations or have relied on proprietary vendor extensions to meet their deployment requirements. Some of these are extremely sophisticated and are on the cutting edge of computer science: BlockApps STRATO, Hydrachain, Quorum, Parity, Dfinity, and Raiden. While understandable, and in fact until now the only effective approach, the downsides are obvious: lack of application portability, code base fragmentation, and vendor lock-in.

Not surprisingly, this has been a point of conversation for some months between enterprise technology vendors, corporate users and Ethereum startups. These discussions have expanded, with the blessing and involvement of Vitalik Buterin and the Ethereum foundation, into a dedicated group of enterprise technology vendors, the largest corporate users and Ethereum infrastructure leaders collaborating to define a roadmap, legal structure, governance and initial technical developments to define 'Enterprise Ethereum'.

To some extent this parallels the paths of other significant platform technologies, such as TCP/IP & HTTP and perhaps (from a software perspective) more relevantly Java and Hadoop.

Java was never intended to be a broadly used enterprise development tool; it was in fact developed originally for interactive television (specifically set-top boxes and smart cards — who remembers Java Card?). However, Java had many advantages for web development with database back-ends (known as web client-server or three-tier architecture): it had comprehensive web and database APIs, it provided 'write-once, run anywhere' platform portability, simplified object-oriented programming constructs with familiar syntax, and a rapidly development ecosystem. Indeed, it was not even Sun that created Java Enterprise Edition (at that time, J2EE); it was a plucky start-up (WebLogic) and a group of enterprise customers and other vendors. Similarly, Hadoop was originally created to index the web and for advertising serving. And who knew TCP/IP would emerge into a protocol that today, literally exists everywhere?

Ethereum is one of the few, indeed perhaps the only, blockchain technology with a similar trajectory and potential. Even the early "public permissionless" vs. "private permissioned" differentiation to expedite enterprise adoption strongly echoes the internet vs. intranet deployment considerations that were so prevalent before enterprises became comfortable with security and scalability issues of the then available public infrastructure.

By banding together the key adopters, supporters and shapers of enterprise usage of Ethereum, we are seeking to provide a platform not only for the technology, but also to provide the governance and tools to create a standard for 'Enterprise Ethereum'.  It is a group of builders & doers, developing sufficient governance for enterprise requirements but not ‘death by committee’ and without ‘pay to play’.  Some of our collaborators have noted the refreshing nature of this approach and the pace of technical progress that is achievable from working off a single standard and open source code base. Moreover, Enterprise Ethereum will build upon the current Ethereum scaling roadmap and  maintain compatibility and interoperability with public Ethereum.  In fact, we believe Enterprise Ethereum will contribute significantly to the overall development of Ethereum.

We’ll soon be releasing formal information regarding the many stakeholders who are already forming Enterprise Ethereum. If you are a large corporate user of Ethereum (or anticipate you will be soon) and are interested in learning more about this initiative, please feel free to contact me so that we can register your interest: jeremy@ethent.org


Stay tuned… the best is yet to come.

Los Silva

Los Silva is a writer and filmmaker who has collaborated with tech and design companies. His interest in Ethereum stems from emerging creative applications that allow artists control of their work through blockchain technology.

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