Microsoft announced on Tuesday that their new Blockchain as a Service (BaaS) product allows the enterprises to build applications on an Ethereum blockchain. This BaaS is specifically tailored toward enterprise environments and has a flexible stance of Ethereum.
With that being said, the blockchain is not secured by a Proof-of-Work (PoW) that we are all used to by now. Microsoft’s BaaS works on a Proof-of-Authority that does not require mining. According to their announcement, this is a better alternative because their product is aimed toward an environment in which the participants do not trust one another.
So how is it different than the already existing cryptocurrency networks?
In the networks that use Proof-of-Work, there is security in an anonymous, open network. But those things are not needed in an enterprise environment since the participants would personally know the other person who they are dealing with. Not only that, these individuals are reputable and known around the organization.
Welcome Proof of Authority
How the Proof of Authority is different than Proof of Work, is that there are additional features built-in the decentralized application (dApp) called the Governance dApp that is used to provide the consortium members with the authority to govern the network or delegate voting power to others. Network participants can also delegate other nodes to vote on their behalf in the event that their primary nodes go offline, ensuring that all members maintain continual consensus participation.
The great thing about Proof of Authority is that the members governing the network can efficiently vote on ways they would like to alter the network in a transparent and auditable manner. They wouldn’t have to create web pages that others would need to fill out to get something done.
Not only can the Proof of Authority based network is much more efficient for enterprise environments, it can also be deployed in as little as five minutes.