Despite rapidly growing interest in the blockchain in recent years, private enterprises have hesitated to adopt this highly secure emerging technology. Reasons cited generally include the blockchain’s poor performance/scalability, lack of support for confidential transactions, and lack of built-in governance. However, with the recent release of the Coco Framework, Microsoft has directly addressed all three of these concerns in order to help pave the way for widespread enterprise adoption in the near future.
Coco: A framework, not a platform
Microsoft has designed Coco as an open framework that integrates with any blockchain platform, such as Etherium, but that is not a blockchain platform itself. Choosing the path of an open ecosystem, rather than a specific platform, Microsoft has given the Coco Framework the capacity to add its strengths to well-established, existing platforms that can benefit from Coco’s performance, confidentiality and governance enhancements. Adding to its flexibility, the Coco framework can run just as well in the cloud as it can on-premises.
Microsoft is committed to making the Coco Framework’s code open-source early next year.
Obstacle 1: Poor performance
The performance problem that blockchain currently faces cleanly divides into two interrelated issues: throughput and latency. An enterprise-grade database needs to handle transactions by the thousands every second with very little latency (i.e. delay between input and output). However, at its present stage of development, blockchain technology often struggles to handle more than a couple dozen transactions per second while often suffering from database latencies of 30 seconds or more. This staggering performance gulf between what enterprises need and what the blockchain offers has prevented many enterprises from considering the blockchain, despite all its virtues, as a serious alternative to a conventional database.
The centerpiece of the Coco performance solution is the concept of a trusted execution environment (TEE). In short, a TEE is a trusted place for an organization to place its blockchain’s code. Organizations can then work with other organizations to build a network of TEEs, a network of trust. With a network of trust in place, the system no longer needs to perform time-consuming, proof-of-work operations that otherwise drag on performance in a blockchain network. As Azure CTO Mark Russinovich demonstrates in Microsoft’s recent introductory video, the result can boost blockchain performance tremendously. For example, the Coco framework can boost throughput on a typical Ethereum blockchain from a sluggish “15 to 25 transactions per second” to a highly competitive 1,600 transactions per second. The Coco-enhanced Ethereum blockchain also reduces transaction latency from nearly 48,000 milliseconds (i.e. 48 seconds) to around 150 milliseconds (i.e. a small fraction of a second).
Obstacle 2: Lack of confidentiality
Another major obstacle hindering enterprise blockchain adoption has been lack of support for confidential transactions. For example, on a typical blockchain ledger, any transaction with a supplier can be seen by all other suppliers on the blockchain. Therefore, in an industry where private transactions with suppliers are essential, the typical blockchain platform has not been a viable option.
The Coco Framework, “designed specifically for confidential consortiums,” adds a layer of confidentiality to otherwise public ledgers, such as Etherium, allowing for the private transactions necessary for enterprise adoption. Early adopter Mojix, for example, found that the Coco Framework helped to move the company toward their vision of “Smart Supply Chains” by giving them the “confidentiality support” they needed without having to sacrifice performance.
Obstacle 3: Lack of built-in governance
Yet another obstacle that stands in the way of widespread enterprise adoption of the blockchain is the blockchain’s lack of built-in governance. For example, if a group of companies on a blockchain network wants to add or remove members from the network, there is no way built-in way to do so through the blockchain itself.
Microsoft has designed the Coco framework with built-in governance, making it possible for companies on a blockchain network integrated with Coco to perform governance-related actions, such as voting new members into the network, without having to leave the platform.
Blockchain in the enterprise
Despite its virtues as a highly secure technology, private enterprises have been hesitant to run their businesses on the blockchain. However, with the release of the Coco Framework, Microsoft has addressed all three of the primary obstacles that stand in their way. First, Coco addresses the performance obstacle with TEE-based networks of trust that boost throughput and reduce latency by eliminating the need for time-consuming proof-of-work processes. Second, Coco addresses the confidentiality obstacle by adding a confidentiality layer to existing blockchain platforms, such as Etherium, making private transactions possible. Third, Coco addresses the governance obstacle with built-in governance functionality, allowing companies that share a network to make changes to the network through the blockchain itself. Altogether, with these solutions and many others, Microsoft aims to pave the way for widespread enterprise adoption of blockchain in the coming months and years.
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