5 Reasons Startups Should Care About Blockchain

Blockchain – the shiny new object in the technology toolkit has taken over the headlines. The market is buzzing over the long-term implications of Blockchain, decentralized systems, and cryptocurrencies. The promise is to disrupt industries such as banking and finance, retail, real estate, and healthcare. The global spending on Blockchain technology according to an IDC report, in 2018 alone, is expected to be cross $2.1 billion.

The report also says, “The year 2018 will be a crucial stage for enterprises as they make a huge leap from proof-of-concept projects to full Blockchain deployments. As a leader in Blockchain innovation and integration, the US will continue to invest in Blockchain throughout the forecast, spending heavily in financial services, manufacturing, and other industries.”

5 reasons startups should care about Blockchain

While all this is very exciting, is this only a “big enterprise” story? To my mind, NO. I feel startups should take a close look at evaluating this technology and the benefits that it brings to the table. Given that the world of Blockchain is yet to mature completely, startups have the opportunity to become early adopters and proponents of this technology. With a first-mover advantage, startups can create a strong Blockchain ecosystem and build a competitive advantage before this space becomes saturated. Here’s my take on why startups should care about Blockchain

  1. Security:

    Blockchain is, as most know, a Peer to Peer (P2P) network. The power to manage and manipulate the network rests with multiple stakeholders. This means that no one person can hack, close chains, manipulate or shut down the blocks, making the Blockchain network guaranteed free from any frauds or hacks.

    Blockchain systems are poised to become the defacto method of storing enterprise data owing to the incorruptible digital ledger of transactions (DLT). The DLT stores all data in an automatic ledger and is encrypted automatically using the latest cryptographic methods. Blockchain systems are also decentralized. This distributed nature of the systems reduces security risks greatly.

    Data is the most valuable currency today. And with that comes the concerns over data security. With the spending on information security standing at $86.4 billion in 2017 and expected to exceed $1 trillion cumulatively from 2017 to 2021, startups with innovative solutions in the space stand to gain.

  2. Transaction and Record Transparency:

    Transparency is ingrained in the DNA of Blockchain. It also provides a high level of privacy since the transaction details are only shared with the defined set of participants involved in the transaction. This technology eliminates third-party interventions. Irrespective of what is the use-case, be it personal details storage, storage of enterprise data, transactions, currency exchange etc., every transaction detail can be clearly tracked.
    How? Well, Blockchain systems employ completely audit-able, unforgeable, indelible, and trackable ledger of transactions. An entry can only be made in the ledger if it is validated by the system using an algorithm. In these GDPR days, startups could benefit from incorporating Blockchain into their products and solutions to assure security and privacy.

  3. Easier Global Partnerships and Low Transaction Costs:

    Blockchain is a technology built with collaboration in mind. Now using Blockchain, startups can propel their growth story by collaborating with offshore partners, and even employing foreign workers. As Blockchain utilizes a global network that is distributed across the world, organizations are no longer restricted by borders to fuel their growth story. Transactions using Blockchain technology also becomes much simpler. There is already the use of smart contracts using Blockchain.  
    Here, a 3rd party, also interacting with the registry, validates the transactions. This means startups and SMEs can transact with contractors, employees, and even customers without turning to (or having to pay fees to) the PayPal types. This means that Blockchain transaction costs are negligible.

  4. Disrupting Storage:

    Decentralized storage also drives constant availability creating a new Cloud paradigm that may be cheaper and easier for startups to access and use. Since this type of decentralized cloud storage is supported by computers and require no manual interventions, there is 24X7 data access and almost zero downtime, without compromising on security.

    PR Newswire estimates the cloud storage market to $88.91 billion by 2022. As the decentralized storage industry is growing rapidly, Blockchain has the potential to completely disrupt both Storage Marketplaces and Storage Infrastructure. While cloud has become central to optimized data storage, 2017 was full of stories of data breaches bringing the issue of third-party dependencies into the light. Blockchain technology gives the cloud the extra edge by giving organizations the capability to centrally manage workloads while the data remains distributed. A number of new startups are utilizing the Blockchain storage marketplace where the “hosts sell their surplus storage capacity and renters purchase this surplus capacity and upload files.”

    Also, as the cost of computing increases incrementally, Blockchain emerges as the leveler for startups. As Blockchain employs pre-existing servers, the decentralized platforms do not need a large investment and thus take the ambiguity out of storage capacities and the associated costs. This cost saving can’t hurt!

  5. Reduce the Cost of Doing Business:

    Blockchain technology and DLT brings improved efficiencies, business flexibility, and the capability to respond to market changes with speed. Startups can implement automated Blockchain networks to address issues like antiquated infrastructures, manual processes, and pen-and-paper systems, and implement digital systems with ease. I mentioned smart contracts.

    These programmable smart contracts can eliminate bureaucracy and lawyers. Here codes are stored on the Blockchain network and can be executed automatically on meeting certain specific conditions. This eliminates the need for third-party interventions like those in banking transactions or legal agreements. By relying on these algorithms, startups can reduce their cost of doing business by streamlining their end-to-end funnel, the supply chain etc.

Clearly, Blockchain is more than Bitcoin and cryptocurrencies. Blockchain technology is accelerating us to a future that is more secure, transparent and fair. It will be interesting to see how the startups leverage this.

Testing for Blockchain – Here’s What You Need To Know

New, cutting-edge technologies are entering the marketplace at an unprecedented speed. The headline-maker on the block happens to be Blockchain, a technology that grabbed eyeballs as one of Bitcoin’s core components. Today, Blockchain is more than just Bitcoin. The blockchain is emerging as the next tech disruptor. According to a survey by the World Economic Forum, 10% of the global GDP will be relying on Blockchain-based technology by 2027.

testing blockchain

So, what is Blockchain Technology?

The brainchild of a person or a group of people using the pseudonym Satoshi Nakamoto, Blockchain is, according to Don & Alex Tapscott, authors Blockchain Revolution (2016), an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value”. The blockchain is essentially a distributed ledger, a continuously growing record list called blocks that are linked and secured using cryptography. This distributed ledger or Blockchain consists of an encrypted digital filing system that creates tamper-proof records in real-time. In other words, Blockchain can be looked upon as an open infrastructure capable of storing several different kinds of assets.

Blockchain and Testing

The blockchain is unique because it removes the need for a middleman to physically oversee transparent actions in real time while at the same time preventing fraud. Supply chain, healthcare, energy, event-ticketing, sales etc. are industries that present themselves to this technology very well. The algorithms used in Blockchain are well-established. Given that it is a distributed system, Blockchain blocks do not have a master copy and are stored in different locations. So, when it comes to testing in Blockchain, given that the algorithms used are sound do we really need to test?
A block, when added to a Blockchain, remains there forever. Any changes to one block will render the following blocks invalid. So, a single change in the Blockchain means that all the subsequent blocks have to be changed simultaneously and right away. Since this cannot be done at a later date, testing of the Blockchain becomes quite complex.

Testing Blockchain-based applications are challenging also because there is a significant change in the technology itself. For sure, Blockchain applications will demand the standard testing and validations such as functional testing, performance testing, integration testing, and security testing. But, that apart, testing teams will also need some specialized testing capabilities.

Standard functional and Non-functional testing

  • Functional Testing: Blockchain technology is finding new applications faster than before. Functional testing of the basic components, the system, and its workings is essential. Testing here is conducted to assess the effectiveness of use-case scenarios and the specific business processes involved.
  • Integration Testing:
    Integration testing is important for Blockchain since deployment could be across several systems and environments. Given this, it becomes essential to ensure that the interfaces between the components, the integrations, and the different parts of the system are functioning cohesively. This is essential to ensure performance consistency.
  • Security Testing:Security testing has to be aggressive for Blockchain applications. The aim is to identify if the application is vulnerable to attacks, assess if the authorization systems are robust, identify if the system protects the data and has the capability to ward off malicious attacks etc. Along with this, it is imperative to test integrity, authentication, confidentiality, and non- repudiation during security testing.
  • Performance Testing:Blockchain applications are built for speed. This makes performance testing even more important. The performance of an application and the latency vary with networks as well as transaction size. Performance testing in Blockchain includes identifying performance bottlenecks, defining the metrics for tuning the system, and assessing if the application is ready for production.

Specialized Testing

  • Smart Contract Testing:Smart Contract testing is a specialized testing. Smart contracts lie at the core of the Blockchain validation process. Testing of smart contracts calls for simulating all possible expected and unexpected conditions for all possible contract. Testing looks at business logic combinations and appropriate execution of all the transactions in the context of a dynamically changing and expanding the network.
  • Peer/node Testing:The power of the Blockchain lies in the shared ledger being exactly the same at each and every node with the same set of and sequence of transactions. This makes it essential to achieve a consensus across all nodes on the order in which the transactions are added to the network. Peer/Node testing for the consistency of transactions is needed. This calls for the testing of the consensus protocol to determine that all the transactions get stored in the proper sequence. This would have to be the case under normal conditions and also under conditions when nodes fail simultaneously or when they do not participate in the network for some time. These tests help ensure that the nodes in the network sync with other validating peers and the integrity of the network and shared ledger are maintained throughout.

Along with all this, testing for block size, chain size, transmission of data, and testing of cryptographical data are also essential to Blockchain applications. Given the sheer number of nodes and the various combinations and transactions that need to be validated, test automation may well prove critical to the success of Blockchain applications.

Conclusion:

The blockchain is an emerging technology, but one that has made everyone sit up and take notice. And like any new technology, how well and how comprehensively we can test will play a key role in its success and adoption and in how much we are able to participate in that success. What does your Blockchain testing strategy look like?

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