Blockchain 101: How Mainframes Can Power Blockchain for Businesses

What do you know about blockchain? As the name suggests, blockchains comprise chains of blocks—that is, chains of transaction entries. What does that really mean? Essentially, blockchain is a shared ledger technology that allows any participant in that particular business network to see the system of record.

Lauded for its efficiency, privacy and reliability, blockchain is valuable across many industries. Over the past year, for example, at least 40 financial institutions have been experimenting with blockchain as a way to reduce costs, transaction time and the risk of fraudulent activity.

Any company that operates within a business network and shares data across that network can benefit from using the technology. Having shared, trustworthy data allows businesses to work better together, in a more efficient manner.

Advantages of Blockchain for Business
The benefits of blockchain are numerous, but there are four main features that make it particularly well-suited to business use. First, the blockchain technology is a shared ledger, recording all transactions among the network’s participants. As a result, there is no single point of failure or single version of the truth, meaning that the ledger is trustworthy and resilient.

Though blockchain is a shared technology, there is still a high degree of privacy, since the data are encrypted. Transactions are verifiable and authenticated, yet secure, so that identity is not linked to the transaction.

Blockchain for business is brought to life by the concept of smart contracts: application logic that is as trustworthy and immutable as the data, because it is recorded on the blockchain. Everyone in the business network agrees that the execution phases of a business contract will proceed in a particular way, according to particular rules.

Finally, blockchain for business is practical on a wide-scale basis because of consensus among participants. All parties agree to network-verified transaction, so transactions are then verified through consensus among network participants. After a transaction is verified, it’s recorded in the ledger in the correct order.

What Blockchain Means to Mainframe
There are many potential business applications of blockchain. The financial services industry is ripe with opportunities, from payment remittance to letters of credit to use as a trading platform. Other possible applications include healthcare (electronic medical records), government (government tender process) or even retail (loyalty points).

Many enterprises are choosing to run blockchain on mainframes, which offer scalability, speed and enhanced security. The mainframe provides the scalability that transactions on blockchain require. Mainframes can run some of the largest, toughest workloads – quickly and securely.

The interaction between blockchain and existing systems data is quick, because of the mainframe’s incredible memory networking capabilities.

Blockchain is only as secure as you make it, though, so it’s important to use a private, permissioned blockchain. Running blockchain on the mainframe can also help improve security, since you get the advantages of mainframe security principles. On the blockchain playing field, the mainframe has a competitive advantage over separate servers in terms of security, speed, and massive performance. Regardless of which platform you choose, using blockchain will help you work better with other businesses and, overall, make processes more efficient.

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