Co-Chains; The Game Changing Blockchain Ecosystem
More than 11 years after Bitcoin’s inception, blockchain’s use in business is still largely theoretical, as the mysterious technology continues to grow and validate the hype surrounding its application. As more individuals seek to leverage this innovation, developers in the space are coming up with new solutions and business applications that are more industry specific and orientated. To capitalize swiftly on this new opportunity, businesses of all types are identifying the benefits of Blockchain; greater transparency, privacy, enhanced security, increased efficiency and speed of transactions, and reduced costs. Various entities such as corporations, governments and the general public have all shown preference towards certain types of blockchain ecosystems, systems and infrastructures.
The main value proposition of Blockchain technology is to establish a creditworthy ecosystem among independent participants in a non-trustable distributed environment. Blockchains can run both as permissioned or permissionless networks depending on the purpose of a given platform. The latter allows interested participants to join and contribute to a network without any approval; permissioned platforms on the other hand operate as private blockchains. It therefore means that one would have to be approved by the central authority within that ecosystem for them to participate in such a network.
Whilst permissioned models have become popular in the world of traditional finance and business, permissionless networks such as Bitcoin & Ethereum have gained the attention of mainstream media – as the result of being open for all to join. Despite their fully decentralized nature, data sensitive institutions like banks are looking for private networks to minimize exposure that public networks fail to provide. This led to the demand of various types of blockchain (Public, Private & Hybrid), where each blockchain business model is tailored & optimized for a unique purpose, essentially developed around a unique philosophy.
However, the emergence of hybrid platforms and most recently the Co-chain architecture by Algorand are several ground-breaking innovations in blockchain that go on to extend and provide extra functionality as the result of running an independent blockchain with its own set of rules, consensus mechanism and architecture.
The Co-Chain Architecture in Blockchain Ecosystems
The Co-chain blockchain infrastructure will allow entities seeking to define the attributes of the blockchain they prefer, this lets participants build & design their idealistic ledger to be integrated within Algorand’s Hybrid blockchain ecosystems. According to Algorand’s founder, Silvio Micali, this cutting-edge tech enjoys the benefits of both private and public ecosystems hence dubbed ‘Co-Chain’. Based on the global nature of business today, Co-Chains present real value in private network expansions as more enterprises and corporations embrace distributed ledgers.
A Co-Chain like Algorand’s allows developers to build ecosystems that are completely independent of the public chain. Ideally, Co-Chains deployed within this network run on their own independent Algorand consensus mechanism and set of validators. These Co-Chains can further interact within the Algorand network based on their interoperability with the main-chain. Last but not least, Co-chains can inherently acquire the underlying tools and features as is the case with Algorand’s permissionless layer. This basically allows Co-Chains to leverage existing resources such as smart contracts and Atomic transfers embedded in Algorand’s Layer-1.
Co-chains Competitive Edge
Blockchain Technology keeps on rapidly evolving that some of the earlier developments & designs are phased out before project owners get to launch their product. Looking back, the most fundamental standard in blockchain development was to embrace full decentralization. This however has changed over time as stakeholders discovered more practical solutions for this nascent technology apart from merely facilitating payment. Today, Algorand’s Co-Chain architecture and hybrid platforms are the new wave of order for enterprises that seek digital expansions while maintaining their data integrity and security.
Co-chains present value in business interoperability which was a major shortcoming in earlier blockchain versions. Algorand for instance, allows its clients to use the Proof-of-Stake (PoS) consensus to build Co-Chains that can interact with other businesses running on the platform’s public chain. In addition, the network participants have access to deployment features such as smart contracts. These tools can be customized to further enhance Co-chain communication for enterprise growth.
It is also easier for businesses to maintain autonomy in Co-chain infrastructures hence better security. Last year, the value of data surpassed that of gold and therefore not surprising for entities to remain cautious on how they share internal or sensitive information. With co-chains, this risk level is lowered as enterprises have control over what data can be shared with the underlying public network.
Another significant value proposition by Co-chains is the scaling attribute; this has been quite a challenge in the uptake of blockchain networks. Most platforms have ended up being slower as numbers within the network increased. Co-chains might change this narrative especially with blockchain’s like Algorand’s whose earlier layout also considered growing the ecosystem. The best part about this innovation is that enterprises will still be able to maintain or increase throughput even as the network grows; this where private blockchain features come into play.
Co-chains Prospective Market
This market remains largely untapped and Algorand stands a good chance to set the pace with its Enterprise-friendly Co-chain architecture platform. That said, it can only be active if the current innovators in this space constantly improve their products to address specific use cases. As mentioned earlier, this tech is slowly becoming a a preferred means for businesses to leverage blockchain for expansion. Other than that, existing public and private blockchain users are strongly considering partial decentralization in order to experience the best of both worlds.
Algorand’s prior existence places this project at an advantageous market entry point with its Co-chain deployment. Over ten projects are currently leveraging the Algorand blockchain to build DLT services. Some notable mentions include Tether, The Marshall Islands, Republic, Shyft Network, IDEX and Securitize.
Co-chains Economic Value & Sustainability
In today’s blockchain world, projects are no longer valued based on speculative solutions but the current proposition. Co-chains are yet to be largely implemented to determine whether they indeed make a sustainable economic case. However, this infrastructure’s fundamentals highlight the possibility of cost-friendly blockchain networks for business growth compared to private or public platforms. Co-chains also present a sustainable case given their scaling features and privacy to maintain a high throughput. This efficiency claims will soon be put to test with Algorand’s Co-chain deployment as the industry moves to next level blockchain solutions.