How the Blockchain-as-a-Service Model is Changing Blockchain Adoption

If blockchain technology adoption is exponential, then we are currently witnessing the calm before the storm. As time passes, more and more companies are becoming aware of the additional security and reliability that blockchain can bring to their business, driving up demand. So what’s the hold up? The major bottleneck in stopping massive adoption is currently the learning curve to deploy and manage a blockchain. Blockchain as a Service (BaaS) companies offer a solution.

As opposed to being a product company which sells a blockchain as a product, a BaaS company acts as a sort of web-host running the complex back-end of a blockchain on behalf of a customer. Typically a BaaS company will build and deploy a blockchain for a client and then step back to allow the customer to build, host, or operate blockchain apps and maximize the usefulness of the new technology with fewer technical difficulties. Under the hood, running the “back-end” of a blockchain could include managing bandwidth, allocating resources efficiently, and keeping the network secure.

The BaaS approach severely cuts down or even eliminates the learning curve to adopt blockchain because all overly technical tasks can be outsourced to the BaaS provider. This allows non-tech companies in food, clothing, healthcare, etc. to adopt the technology despite it previously not being feasible. Realizing the potential opportunity that this brings, large companies such as Microsoft and Amazon have deployed their own BaaS branches through Azure and AWS. Soon more BaaS companies will enter the scene, driving down costs for consumers and advancing the quality of support offered.

Despite the numerous benefits BaaS companies bring to the market, there is one unavoidable drawback: their existence is a step away from decentralization. In a perfect world, every company would have an internal blockchain expert to deploy and manage an entirely customizable blockchain for them, but this is impossible given the current scarcity of blockchain programmers. This leads to a future where almost all private blockchains will be entrusted to run smoothly by the select few largest BaaS companies. Eventually as blockchain literacy increases in the coming decades, businesses will be able to move to a trustless system with no third parties as internally developed blockchains will become preferable to those offered by BaaS companies.

With the above problem’s solution many years down the line, the only thing certain now is that massive blockchain adoption is inevitable and it will be the result of the BaaS model on-ramping companies to the revolution by the thousands.

References:

Daley, Sam. “18 Blockchain-as-a-Service Companies Making the DLT More Accessible.” Built In, https://builtin.com/blockchain/blockchain-as-a-service-companies.

Frankenfield, Jake. “What Is Blockchain-as-a-Service (Baas)?” Investopedia, Investopedia, 8 Feb. 2022, https://www.investopedia.com/terms/b/blockchainasaservice-baas.asp#:~:text=Blockchain%2Das%2Da%2Dservice%20(BaaS)%20refers%20to,chain%20based%20app%20or%20platform.

“What Is Blockchain-as-a-Service & Its Business Benefits?” Appinventiv, 24 May 2022, https://appinventiv.com/blog/what-is-blockchain-as-a-service/#:~:text=Blockchain%2Das%2Da%2Dservice%20business%20model%20describes%20the%20process,technology%20in%20return%20for%20fees.