When is Blockchain Needed?

Blockchain originally emerged as the technological innovation that powered new forms of digital currency like Bitcoin. However, recent years have seen leaders in banking, finance, government, and many more organizations giving this new innovation more attention than ever before. This reputation has been attributed to its properties of allowing data to be shared across a large network of untrusted entities without relying on a trusted third party. Blockchain provides advantage for non-repudiation and integrity of secured data storage resulting in a more transparent process. This paper critically analyzes whether a blockchain is ideally the application technical solution for a specific scenario. Moreover, we compare the differences between a 'permissionless' blockchain such as bitcoin, and a 'permissioned' blockchain such as hyperledger, commonly preferred by established institutions like banks and compare their features with that of a centralized database. We then provide a structured methodology to determine the efficient solution to solve a specific application problem. With our methodology, we explore three use cases payments, supply chain management, and decentralized autonomous organizations and conclude this article with an outlook for further opportunities.

Author(s): Frimpong Atta Junior Osei*

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