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Enterprise Blockchain Types and its Benefits | Ultimate Guide

Navdeep Singh Gill | 26 June 2023

Enterprise Blockchain Types and its Benefits

Introduction to Blockchain

Blockchain technology is a decentralized and transparent system allows multiple parties to maintain a shared digital ledger without a central authority. It enables secure and immutable recording of transactions, making it suitable for various industries and use cases.

A real-life example of blockchain technology is Bitcoin, the first and most well-known cryptocurrency. Bitcoin uses blockchain as its underlying technology to enable peer-to-peer transactions without the need for intermediaries like banks. The blockchain serves as a public ledger that records all Bitcoin transactions in chronological order, which can be accessed and verified by anyone in the network.

With blockchain, each transaction is grouped into a block, and these blocks are linked together using cryptographic hashes, forming a chain of blocks. Once a block is added to the blockchain, altering or deleting the information within it becomes virtually impossible, providing high transparency and immutability.

Blockchain technology is also being explored and implemented in industries beyond cryptocurrencies. For instance, in supply chain management, companies like IBM have developed solutions like IBM Food Trust, which utilizes blockchain to enhance transparency and traceability in the food supply chain. It enables consumers, retailers, and producers to track the journey of food products from farm to table, reducing fraud, improving food safety, and increasing trust among stakeholders. 
Blockchain technology provides a decentralized and secure method of recording and verifying transactions. Its applications extend beyond cryptocurrencies and can be used in various industries to enhance transparency, security, and efficiency in processes involving multiple parties.

Blockchain Technology aims at removing this third-party involvement and keeping the transactions only limited to the sender and the receiver. Taken From Article, Blockchain Technology Industry Solutions and Applications

Evolution of Blockchain in Enterprises

Several key milestones and developments have marked the evolution of blockchain technology in enterprises. Here is an overview of the significant stages in the evolution of blockchain in enterprises:

  • Early Awareness and Experimentation: In the early years of blockchain, enterprises began to take notice of its potential beyond cryptocurrencies. They started exploring the technology's capabilities and experimenting with proof-of-concept projects to understand its benefits and limitations. This stage was characterized by a growing interest in blockchain's decentralized and transparent nature. 
  • Consortium and Private Blockchains: As enterprises recognized the need for privacy, scalability, and control over their blockchain networks, the focus shifted towards consortium and private blockchains. Consortium blockchains involve organizations collaborating to run and maintain a blockchain network while a single organization operates private blockchains. These blockchains allow enterprises to share data securely within a closed network of trusted participants.
  • Integration with Existing Systems: Enterprises realized that blockchain must be integrated with their existing systems and processes to deliver its full potential. This stage involved efforts to bridge the gap between legacy systems and blockchain networks, allowing for seamless data exchange and interoperability. Integration tools, APIs, and middleware solutions were developed to facilitate integration.
  • Enterprise-Grade Blockchain Platforms: To address the specific needs of enterprises, blockchain platforms tailored for business applications emerged. Platforms like Hyperledger Fabric, Ethereum Enterprise, R3 Corda, and Quorum were developed with features such as permissioned networks, smart contract capabilities, and enhanced scalability. These platforms provided enterprises with the tools and frameworks to build and deploy blockchain solutions.
  • Industry-Specific Use Cases: Enterprises started identifying industry-specific use cases where blockchain technology could bring significant value. Supply chain management, financial services, healthcare, identity management, and government sectors became focus areas for implementing blockchain solutions. Use cases such as secure document verification, transparent supply chain tracking, and decentralized identity management gained traction.
  • Collaborative Networks and Standards: As blockchain adoption grew, industry consortia and collaborative networks were formed to drive standardization and interoperability. Organizations joined forces to develop common frameworks, protocols, and standards to ensure compatibility and seamless integration between blockchain solutions. These collaborative efforts aimed to create a conducive environment for widespread enterprise blockchain adoption.
  • Scalability and Performance Enhancements: Scalability and performance have been key challenges for enterprise blockchain adoption. Various scaling solutions, such as sharding, sidechains, and layer two protocols, were explored to improve throughput and transaction speed without compromising security and decentralization. These advancements aimed to make blockchain technology more suitable for enterprise-scale applications.
  • Integration with Emerging Technologies: Blockchain technology has started to converge with other emerging technologies, such as artificial intelligence (AI), the Internet of Things (IoT), and cloud computing. Integration with AI enables intelligent contract automation and predictive analytics, while IoT integration allows for secure and trusted data exchange between devices. This convergence opens new possibilities for innovative and interconnected blockchain applications.

The evolution of blockchain in enterprises is an ongoing process driven by continuous research, development, and real-world implementations. As technology matures, enterprises are increasingly exploring the transformative potential of blockchain to revolutionize various industries and redefine existing business models.

A decentralized network with millions of users around the world. All users have access to it, and all data on it is protected by encryption. Taken From Article, Blockchain in Cybersecurity

What are the Key Features of Enterprise Blockchain?

Enterprise blockchain refers to applying blockchain technology specifically for businesses and organizations. It offers several key features that differentiate it from public or permissionless blockchains. Here are some of the critical features of enterprise blockchain:

  • Permissioned Access: Enterprise blockchains typically operate on a permission basis, meaning that participants must be granted access by the network administrator. This ensures that only authorized entities can join the blockchain network and participate in transactions and consensus processes. Permissioned access provides greater control, privacy, and security for enterprises.
  • Scalability and Performance: Enterprise blockchains prioritize scalability and performance to meet the demands of business environments. They employ consensus algorithms, sharding, and off-chain processing techniques to achieve higher transaction throughput and faster confirmation times. These optimizations enable enterprise blockchains to handle a large volume of transactions efficiently.
  • Privacy and Confidentiality: Confidentiality is crucial for many enterprise use cases. Enterprise blockchains offer privacy features allowing participants to transact and share sensitive data securely. Techniques like cryptographic encryption, zero-knowledge proofs, and selective disclosure mechanisms are employed to protect data privacy while still ensuring the integrity and transparency of the blockchain.
  • Smart Contracts and Business Logic: Enterprise blockchains often support smart contracts, self-executing contracts with predefined rules and conditions. Smart contracts enable automation and programmability within the blockchain network, facilitating the execution of complex business logic and agreements. Enterprises can use smart contracts to streamline processes, enforce business rules, and reduce reliance on intermediaries.
  • Governance and Consensus Mechanisms: Enterprise blockchains incorporate governance models to ensure effective decision-making and consensus among network participants. These models define the rules, protocols, and processes for managing the blockchain network. Consensus mechanisms, such as Practical Byzantine Fault Tolerance (PBFT) or Proof of Authority (PoA), validate and agree upon transactions, providing the necessary trust and reliability for enterprise applications.
  • Interoperability and Integration: Enterprise blockchains focus on interoperability, enabling seamless integration with existing systems and networks. They offer standard APIs, protocols, and integration frameworks to facilitate data exchange and interaction between the blockchain and external systems, allowing for smooth integration with enterprise applications, databases, and legacy infrastructure.
  • Auditing and Compliance: Enterprises require robust auditing and compliance capabilities. Enterprise blockchains provide transparent and immutable records of all transactions and activities, making tracking and auditing data easier. This feature is precious in industries with strict regulatory requirements, such as finance, healthcare, and supply chain management.
  • Network Management and Administration: Enterprise blockchains have dedicated network administrators or consortiums overseeing the blockchain network's governance, maintenance, and management. They handle tasks like adding new participants, managing permissions, resolving disputes, and upgrading the blockchain infrastructure. Network administrators ensure the smooth operation and security of the enterprise blockchain ecosystem.

These key features make enterprise blockchain well-suited for businesses and organizations seeking to leverage blockchain technology while addressing their specific scalability, privacy, control, and regulatory compliance needs.

What are the types of Enterprise Blockchains?

There are several enterprise blockchains, each with characteristics and suitability for different use cases. The main types of enterprise blockchains include:

Public Blockchain

Public blockchains are open and permissionless, allowing anyone to join the network, participate in consensus, and validate transactions. While not specifically designed for enterprise use, some organizations may leverage public blockchains for specific applications. Public blockchains, such as Bitcoin and Ethereum, provide a high level of decentralization and transparency but may have limitations regarding scalability and privacy.

Private Blockchain

A private blockchain, also known as a "permissioned blockchain," is restricted to a specific group of participants permitted to participate and operate the network. These participants are typically known and trusted entities, such as consortium members or employees within an organization. Private blockchains offer more privacy, scalability, and control than public ones. Examples of private blockchain platforms include Hyperledger Fabric and R3 Corda.

Consortium Blockchain

Consortium blockchains are a variant of private blockchains where multiple organizations come together to form a shared blockchain network. Consortium members jointly manage the network and participate in consensus mechanisms. Consortium blockchains are suitable for use cases where multiple entities must collaborate while maintaining a certain level of trust and control. They are often found in industries such as supply chain management and finance.

Hybrid Blockchain

Hybrid blockchains combine properties of public and private blockchains. They provide a flexible architecture that allows certain parts of the blockchain to be public while others remain private. This allows for a balance between transparency and privacy, accommodating various use cases. Hybrid blockchains can enable interoperability between public and private networks or provide selective data sharing between participants.

Federated Blockchain

Federated blockchains, or consortium blockchains with enhanced governance, are designed for situations where a limited number of pre-selected nodes or validators control the consensus process. This model provides higher scalability and faster transaction confirmation times than fully decentralized blockchains. Federated blockchains are commonly used in enterprise environments where efficiency and performance are crucial.

Permissioned vs. Permissionless 

While not distinct types of blockchains, the permissioned vs. permissionless categorization refers to the level of access and participation in a blockchain network. Permissioned blockchains require participants to be granted explicit permission to join and operate the network, ensuring a controlled and trusted ecosystem. On the other hand, permissionless blockchains allow anyone to join and participate, emphasizing openness and decentralization.  

It's important to note that the choice of blockchain type depends on the specific requirements, privacy needs, scalability concerns, and governance considerations of an enterprise use case. Enterprises may combine different types or customize existing blockchain frameworks to meet their unique needs.

The insurance industry and customers are affected due to fraud reports and fraud insurance accounts for property and casualty losses. Taken From Article, Use Cases of Blockchain for Insurance Industry

What are the benefits of Enterprise Blockchain?

Enterprise blockchain offers several benefits that can positively impact businesses and organizations. Here are five key benefits of enterprise blockchain:

  • Enhanced Transparency and Traceability: Enterprise blockchain provides a transparent and immutable ledger of transactions and data. This transparency enables all participants to have a shared view of the information, reducing disputes and fostering trust among stakeholders. It also enables traceability, allowing businesses to track and verify the origin, movement, and authenticity of assets or goods throughout the supply chain. Enhanced transparency and traceability can improve accountability, mitigate fraud, and streamline auditing processes.
  • Improved Efficiency and Cost Savings: By eliminating the need for intermediaries and automating processes, enterprise blockchain can improve operational efficiency and reduce costs. Smart contracts, enabled by blockchain technology, automate the execution and enforcement of predefined rules and agreements, minimizing manual intervention and reducing paperwork. Additionally, blockchain streamlines complex workflows, reduces redundancies, and enables real-time data sharing, leading to faster and more efficient transactions.
  • Increased Security and Data Integrity: Enterprise blockchain employs cryptographic techniques and consensus algorithms to ensure the security and integrity of data. The decentralized nature of blockchain makes it resistant to single points of failure and cyberattacks. Transactions recorded on the blockchain are immutable, meaning they cannot be altered or tampered with, providing high data integrity and auditability. Encryption techniques further enhance the security and privacy of sensitive information.
  • Streamlined Inter-organizational Processes: Many business processes involve multiple organizations, leading to complex coordination and reconciliation efforts. Enterprise blockchain simplifies these processes by providing a shared, trusted data exchange and collaboration platform. It eliminates the need for reconciling separate databases, as all participants share a common, synchronized ledger. This streamlines inter-organizational processes, reduce delays, and enables real-time data sharing, leading to increased efficiency and improved business relationships.
  • Enhanced Trust and Collaboration: Blockchain technology enables trust among participants by providing a decentralized and transparent system. The immutability of transactions and the consensus-based validation process instill confidence in the accuracy and reliability of the data. This increased trust fosters collaboration between organizations with limited trust in one another, allowing for secure and efficient collaboration in supply chain management, joint ventures, or shared data initiatives. Blockchain's trust-enhancing features can lead to new business opportunities and improved partnerships.

These benefits make enterprise blockchain a compelling technology for businesses and organizations seeking to optimize processes, improve security, foster collaboration, and gain a competitive edge in various industries. However, it's important to note that implementing an enterprise blockchain solution requires careful planning, consideration of specific use cases, and addressing technical and regulatory challenges to realize these benefits fully.

Implementing Enterprise Blockchain Solutions

Implementing enterprise blockchain solutions involves several steps and considerations. Here's a high-level overview of the process with an example:

  • Identify the Use Case: Determine the business problem or use case that can benefit from blockchain technology. For example, a supply chain management use case where multiple parties need to track and verify the authenticity and movement of goods.
  • Define the Network Participants: Identify the key stakeholders and participants who will be part of the blockchain network. The supply chain example could include manufacturers, distributors, retailers, and logistics providers.
  • Choose the Blockchain Platform: Select a suitable enterprise blockchain platform that aligns with the use case's requirements. Popular platforms include Hyperledger Fabric, R3 Corda, or Ethereum-based solutions. Consider scalability, privacy features, interoperability, and developer support.
  • Design the Network Architecture: Define the network architecture, including the consensus mechanism, data structure, and smart contract functionality. Determine whether the network will be public, private, or a consortium blockchain. Define the roles and permissions of participants in accessing and validating transactions.
  • Develop Smart Contracts: Create intelligent contracts that automate and enforce business rules within the blockchain network. In the supply chain example, smart contracts could include rules for verifying product authenticity, tracking shipments, and managing payments.
  • Integration with Existing Systems: Determine how the enterprise blockchain solution will integrate with existing systems and databases. Develop APIs or integration layers to facilitate seamless data exchange between the blockchain network and external systems.
  • Test and Deployment: Conduct thorough testing of the blockchain solution to ensure its functionality, security, and performance. Deploy the solution in a production environment, either on-premises or cloud infrastructure.
  • Network Governance and Maintenance: Establish governance processes and policies for the ongoing management of the blockchain network. Define roles, responsibilities, decision-making frameworks, and network upgrades and maintenance mechanisms.
  • User Adoption and Education: Educate and train network participants on interacting with the blockchain solution. Provide user-friendly interfaces and tools to facilitate user adoption and encourage engagement with the network.
  • Monitor and Iterate: Continuously monitor the performance and effectiveness of the enterprise blockchain solution. Gather feedback from participants and stakeholders to identify areas for improvement and iterate on the implementation.

For example, a company implementing an enterprise blockchain solution for supply chain management could use Hyperledger Fabric as the blockchain platform. They would define the network architecture, roles, and permissions and develop smart contracts to automate tracking and verification processes. The solution would integrate with existing ERP systems and logistics platforms to exchange data seamlessly. The company would then deploy and test the solution, educate participants, and establish governance processes for ongoing network management.

A distributed database that maintains a continuously-growing list of ordered records called blocks. Taken From Article, BlockChain App Development with Serverless

What are the challenges of Enterprise Blockchain?

Implementing enterprise blockchain solutions can be accompanied by several challenges. Here are some common challenges that organizations may face:

  • Scalability: Blockchain technology, especially public blockchains, often faces scalability limitations, such as slower transaction processing and increased resource requirements, as the network grows. Implementing enterprise-scale blockchain solutions requires careful consideration of scalability issues to ensure the system can handle a large volume of transactions efficiently.
  • Privacy and Confidentiality: While blockchain provides transparency, enterprises often need to protect sensitive business information. Achieving privacy and confidentiality in a blockchain network can be challenging, especially when multiple participants are involved. Implementing appropriate privacy-enhancing techniques, such as encryption, zero-knowledge proofs, or selective disclosure, becomes crucial.
  • Interoperability: Integrating blockchain solutions with existing systems and technologies can be complex. Enterprises often have legacy systems and databases that need to interact with the blockchain network. Ensuring seamless interoperability between the blockchain solution and external systems requires careful planning, development of appropriate APIs, and data standardization.
  • Governance and Consensus: Establishing governance models and decision-making processes within an enterprise blockchain network can be challenging. Determining participants' roles, responsibilities, and decision authority, especially in consortium or federated blockchains, requires clear agreements and coordination among stakeholders. Choosing the proper consensus mechanism that balances security, performance, and decentralization is also crucial.
  • Regulatory and Legal Considerations: Blockchain implementations may face regulatory and legal challenges as the technology disrupts traditional jurisdiction and data ownership concepts. Compliance with relevant laws, data protection regulations, and industry-specific requirements becomes essential. Navigating the legal landscape and ensuring compliance can be a complex process.
  • Integration and Adoption: Integrating blockchain technology into existing organizational processes and workflows can be a significant hurdle. It may require changes to existing systems, team member training, and organizational cultural adaptation. Achieving user adoption and buy-in for the blockchain solution among participants can also be a challenge.
  • Cost and Return on Investment (ROI): Implementing an enterprise blockchain solution can involve significant upfront costs, including infrastructure, development, and ongoing maintenance. Calculating the expected return on investment and demonstrating the value proposition of blockchain technology to stakeholders becomes crucial to secure necessary resources.

Addressing these challenges requires a thorough understanding of the use case, stakeholder collaboration, and a well-defined implementation strategy. Overcoming these challenges can help organizations unlock the benefits of enterprise blockchain technology and drive innovation in their respective industries.


Enterprise blockchain holds significant potential to revolutionize the way businesses operate and collaborate. Its key features, such as transparency, traceability, enhanced security, and streamlined processes, offer tangible benefits across various industries. Organizations can improve efficiency, reduce costs, enhance trust, and unlock new business opportunities by implementing enterprise blockchain solutions. However, it's essential to acknowledge that implementing enterprise blockchain is challenging. Issues like scalability, privacy, interoperability, governance, regulatory compliance, integration, and adoption must be carefully addressed. Overcoming these challenges requires strategic planning, collaboration, and a clear understanding of the specific use case. Despite these challenges, enterprise blockchain can potentially drive transformative change by enabling secure and efficient collaboration between organizations, reducing fraud and disputes, improving supply chain management, and enhancing data integrity.