Infrastructure Providers Defined: An Introduction
This piece provides a brief overview of what blockchain infrastructure providers do. In future posts, we’ll dive more in depth on the technical nuances involved with running a blockchain infrastructure.
If you read the previous post about the importance of “The State of the Digital Asset Data and Infrastructure Landscape” research report, then now it’s time to begin diving into the report to understand it’s full value as both a sales tool and education tool.
At a high level, the report maps out the landscape of the blockchain industry, by dividing it up into a few main sections:
- Infrastructure providers
- On-Chain data providers
- Market data providers
- Other
In this piece, we’ll be providing a brief overview of infrastructure providers, one of the main categories in The Block’s research report.
Defining Blockchain Infrastructure Providers
The Block research group defines infrastructure providers as, “blockchain-as-a-service products enabling developers and businesses to build blockchain-enabled applications.” In other words, these companies:
- Host and maintain nodes
- Guarantee high levels of uptime
- Ensure highly secure and reliable infrastructure
- Offer data feeds in the form of REST APIs, WebSockets, and/or Webhooks
- Provide developer tools
- May offer other professional services, which includes helping to build products, assigning dedicated account managers, premium support, and other value-adds commonly provided by other SaaS providers
This together enables other companies to easily read or write blockchain data to build with digital assets, without the need to become blockchain experts themselves.
Is Running Our Own Infrastructure Really that Difficult?
It’s not just about running a node — although there are headaches associated with that. For example, setting up a full Ethereum node can take months just to sync the entire chain. Additionally, protocols have updates. To create a system where you update a node properly, with backup, while also keeping other nodes live to ensure no downtime is not a trivial matter.
But for enterprises, it goes even beyond this. It’s about building and maintaining a highly secure, robust, high throughput system that allows enables your company’s software to read and write data extremely quickly for millions, if not, billions of users. Additionally, multiple Points-of-Presence (POPs) is crucial for data integrity, validation, and high amounts of uptime. In a future post, we’ll dive into more of the nuances involved with technically running your own blockchain infrastructure.
Who are their Customers?
Prospective clients for infrastructure providers can be virtually any company. Infrastructure providers are the foundational backbone for all apps built to integrate with digital assets. Essentially, they help all apps run smoother and more reliably.
Common customer segments seen today are:
- Banks
- FinTech companies
- Exchanges and OTC desks
- Decentralized applications (dApps)
- On-chain analytics providers
- Government agencies
Common use cases are to build and maintain infrastructure to support custody solutions, receive read and write data for building all types of dApps, receiving data for KYC/AML operations, and much more. Ultimately, they are the foundation layer for any company that needs to interact and build with digital assets.
What’s the Benefit to the Customer?
Cost, time, and expertise. The attractiveness of partnering with an infrastructure provider is primarily to get to market more quickly, save on cost, and take advantage of the expertise that the provider has. The most valuable resource to any company is its team, and to form a team of blockchain engineering and business experts is no small feat.
Blockset for example is proud to be able to get projects to market in half the time, at a fraction of the cost. When dealing with expenses human resources and technical infrastructure, these savings are substantial. Check out our Chain Cost Calculator to see an estimate of what it would cost you to run your operation without Blockset.
Here are the Leaders to Keep Up With
The Block has created a Magic Quadrant chart, and to most people breaking this down, the ‘leaders’ section is the place that companies want to be.
The highest performing leaders today are Alchemy and Infura as they are early to market. But, Infura supports only Ethereum. Alchemy, on the other hand, does support more chains and has on-boarded 170 companies to date, aiming for the enterprise client, just like Blockset. We are proud to see Blockset there with these leaders. While Blockset may be the newest one in the leaderboard, the infrastructure and offering of Blockset is essentially a productized version of the infrastructure built over the past 6 years to create BRD, one of the largest non-custodial wallets supporting nearly 5 million customers at the time of writing. So, while BRD is just entering the B2B space, the technology, expertise in blockchain, and past experience of team members give Blockset a huge head start. Blockset is currently working with major banks and financial institutions today.
Below is one more graphics showcasing the different players and offerings:
Notice how virtually every company has a SaaS offering, which is a clear indicator of targeting institutional clients. With a dedicated account manager, custom functionality, and the other offerings that come with SaaS, the infrastructure landscape is generally targeting enterprises, although it is not uncommon to find API offerings that can still be used by developers and startups.
By now you should understand what infrastructure providers are and why they’re a vital need in the industry. To learn more about the different players in the infrastructure business of the blockchain services industry, check out The Block’s report here. This research report is an unbiased analysis of the landscape that can be used to give concrete answers to objections, questions, or comments from those entering the space or looking to integrate with digital assets.
