Will Big Tech Dominate the Future of Blockchain?
Since the early days of blockchain’s development, the actual construction of the technological framework has been largely left to smaller enterprises. Developers and researchers have been first trying to establish exactly what the technology needs to be, before working to tackle key issues like scalability and privacy, which are essential if the technology is to have any mainstream future.
However, it was a matter of time before the world’s biggest technology companies caught up with blockchain’s potential — or, rather, saw their moment to muscle in. Google, Facebook and Microsoft have all been experimenting with decentralised technology for some time now. Google is working on “blockchain-related” technology with a view to supporting its cloud business. Facebook recently acquired a blockchain startup and has just this month registered Libra Networks, a secretive cryptocurrency firm to be based in Switzerland. Microsoft, through its cloud computing platform Azure, has been hosting blockchain projects for a while on what is a complex and filled-out solution architecture. None have been quite as prominent as Amazon, though, which has set out its stall as a future leader.
Crashing the Party
Jeff Bezos’ behemoth has attempted to position itself front and centre of the blockchain conversation over the past year or so, dedicating a significant portion of Amazon Web Services (AWS) to the technology. Its latest product, Amazon Managed Blockchain, is a service that the giant says ‘makes it easy to create and manage scalable blockchain networks’.
The tech is based on Hyperledger Fabric, with Ethereum set to come soon. Having been available for preview for months, the product became available in April 2019, rolling out globally by the end of the year. What Amazon has created is not dissimilar from a website builder — customers choose their network type, add members and configure member nodes. Amazon, meanwhile, creates the blockchain network and puts together the software, security and network settings.
This is not a shocking development. As with many major technologies in the past, the biggest companies have been happy to allow development to happen elsewhere, in the academic and technical arms of the industry, before choosing their moment and creating a consumer-friendly product backed by the full force of their boundless resources.
Since Amazon became publicly (and financially) interested in blockchain technology, it has experimented with alternative uses for it, too. There was a recent (if limited) buzz in the crypto community when Amazon successfully filed a patent for its own proof-of-work system styled on Bitcoin. This isn’t to say that the e-commerce giant is planning to accept cryptocurrency as part of its payment system any time soon, though.
The patent was originally filed in December 2016, appearing to outline a way for proof-of-work to be used to prevent distributed denial-of-service (DDoS) attacks. As the application puts it: “One way to mitigate against such attacks is to configure a service such that requests to the service incur some sort of expense, thereby providing a disincentive to participating in the attack.” It’s an interesting use-case, taking an element of distributed ledger technology and putting it to use to solve a pre-existing problem.
An Unwelcome Influence
For many, though, involvement from the establishment organisations in blockchain’s development cannot represent a good thing. Amazon, for example, is looking to corner a significant portion of the enterprise blockchain space with its Quantum Ledger Database (QLDB), which is a centrally administered immutable data ledger. Gartner predicts its market share could be huge, but it isn’t a distributed or tokenised consensus system at all, rather it is just an immutable record. If it isn’t tokenised or distributed then many would argue that it fundamentally isn’t a blockchain.
For others, big-name involvement in blockchain technology is actively damaging. There is a prevailing and persuasive argument that blockchain should in no way be controlled by, or be beholden to, any major organisations. At its heart, blockchain is a democratic technology that by definition is in opposition to the notion of ownership, particularly when it comes to the technology itself (as opposed to the information stored on it).
The idea, ultimately, is that blockchain must be protected from simply being hoovered up by the likes of Amazon and Google. Rather than a handful of key players benefiting disproportionately from the development and implementation of blockchain — which has been the outcome of the internet itself — the technology should allow all members of a blockchain to benefit.
The whole notion of blockchain-as-a-service, provided by one of the existing monolithic tech giants, is unsurprisingly distasteful to those that have worked to create as democratic an ecosystem as possible. The tweet below hints at the overwhelming power these companies have, though, along with their ability to forcefully corner markets.
There is a natural incentive for existing tech companies to want to control or in some way interfere with blockchain’s development — it stands at odds with centralised authorities and middlemen, categories under which almost all established giants fall. Run an Uber-like ride-hailing platform on a blockchain using smart contracts to ensure everything works smoothly and you’ve essentially gotten rid of the need for Uber entirely.
Going forward, it will be fascinating to see how existing tech companies grapple with technology that could lay waste to their business models. The likes of Amazon and Google are looking to corner and take control of it, while the Ubers of this world seem to be ignoring what is an existential threat to their empires. Allowing the major tech companies to muscle in and heavily influence the development of blockchain could threaten the core principles of the technology itself. On the other hand, having that much capital behind the tech could help boost its development. What do you think of big tech’s involvement in blockchain development? Let us know in the comments.
