Blockchain Integration: A Step-By-Step Guide

Published in

The Startup

7 min readJan 31, 2019

“No Matter What The Context, There’s A Strong Possibility That Blockchain Will Affect Your Business. The Very Big Question Is When.” 一 Harvard Business Review, The Truth About Blockchain

Hearing “blockchain is the next groundbreaking technology after Internet” surely sounds like a cliche now but no matter the nature of your business, blockchain will get back at you. If you are not already experimenting in the blockchain, are you out of the race? To understand how mainstream has blockchain gone, let’s take a look at the S-Curve of adoption.

This bell curve speaks a lot about the future. We have already kicked into the phase of early majority. A lot of newly found companies have crafted brilliant solutions to address real-world problems effectively using blockchain technology.

A trip down the memory lane: TCP/IP

TCP/IP (Transmission Control Protocol/Internet Protocol) is the heart of what we call the Internet. TCP/IP was introduced in 1972 and suited ideally for emailing. Before TCP/IP, “circuit switching” technology was used in which a path between sender and receiver must be predefined with the central exchange or else communication will not take place. This means that the telecom company spent an extravagant amount of money to set up lines connecting all senders with all receivers.

TCP/IP completely disrupted this model.

The new model, known as “packet switching” model fragmented data in the form of packets and dispersed them in the network. Each packet was easy routed to its designated recipient because of information about the address located inside control header of the packet.

Telecom companies viewed this model with remarkable skepticism. However, the momentum turned into a revolution and WWW came about in the 1990s. Look where we are now with TCP/IP.

Since we are already in “early majority” phase of the bell curve, now is the time to think about being the forerunner of this technology.

IT practitioners are eyeing this promising technology, but most of them do not have a starting point. This article aims to equip the reader to gain perspective on how to start blockchain integration with their own business.

Step 1: How Urgently Should You Integrate Blockchain With Your Business

Blockchain will ultimately have an impact on all industries, but different sectors would be disrupted at different times. The real deal is to figure out when will your business be affected. If you are eyeing for a complete digital transformation for your business, you may want to incorporate blockchain within your business ecosystem.

The main idea behind blockchain is not to eliminate “trust” out of the picture but rather to strengthen the same. Blockchain makes the IT system more trustful. Even if the actors of the ecosystem do not know each other, blockchain builds the foundation of trust in seconds which can take years going by the conventional methods.

If your business does processing in real time and every millisecond is precious to you, then blockchain is not the best solution for you at the moment because this technology is still very new and is not fast enough to do real-time processing.

“The blockchain’s full transformational impact will play out over decades rather than years because such innovations must overcome many barriers, — technological, organizational, governance, political. The impact of blockchain could well be enormous, but its full transformational impact will take a considerable time.”

— Irving Wladawsky-Berger, Is Blockchain Ready to “Cross the Chasm”?

If blockchain is not the best for your business at the moment, there are other alternatives you can try. For example, Centralised Database with Open API: The data will rest in a single database, but since it is open, everyone can access the replicated copies of data. This is different from decentralization because ultimately there is just one place where actual data is stored. Remaining copies are created from this central database. This may be plagued with (Single Point Of Failure) SPOF attack.

Step 2: Identify A Relevant Use Case

Building a use case is the first step into the development of any blockchain project. It delineates the outline of the plan. A use-case driven project is a successful one. A customer-driven use-case model is the ideal one.

There are an infinite number of use-cases; banking the unbanked, supply-chain management, provenance in the food industry and what not.

If we abstract all use-cases to a higher level, we find that the most use-cases fall under one or more of the following categories:

Smart Contracts
Asset Management (Tokenization)
Data Authentication & Verification
Digital Identities

Finding use-cases which span across multiple industries can be tough, but the true essence of blockchain is to create a distributed network via which the gap between different industries can be bridged.

Step 3: Identify the Consensus Mechanism

The bitcoin blockchain harnesses the power of Proof of Work (PoW) consensus protocol. Today, there are multiple algorithms to select from like Proof of Stake (PoS), Byzantine Fault Tolerant (BFT), Proof of Elapsed Time (PoET), Proof of Authority (PoA), Delegated-Proof of Stake (dPoS) etc.

Each consensus algorithm has its pros and cons, so there is no “best’ consensus algorithm. The algorithm should be chosen depending upon the use-case. Generally, there is a trade-off between decentralization, security, transparency.

Step 4: Identify Most Suitable Platform

Just the way there are multiple consensus algorithms at our disposal, there are numerous platforms on which we can implement them. Most of them are free and open source. Selection of the ideal platform again depends upon use-case and consensus algorithm.

Some platforms are:

Ethereum
BigChainDB
Corda
Tendermint
Hyperledger Fabric
Hyperledger Sawtooth
Hyperledger Iroha
Quorum
Apla

Step 5: Build Proof of Concept (PoC)

After the technology stack has been confirmed, it’s time to chart out developmental strategy. Proof of Concepts highlights the viability and feasibility of the use-case. Mostly, a PoC only demonstrates the idea. In this step, many unforeseen obstacles are identified and dealt with. A PoC can be used to bring more business by selling it to prospective clients.

Step 6: Research Legal/Regulatory Requirements

Many countries are still very skeptical about this technology and are therefore taking stringent measures against it. Also, since blockchain is still an emerging technology (yet to go mainstream), the laws are either not there at all or are very poorly defined. This varies from one geographic location to another. It is a prudent choice to do this research beforehand.

Step 7: Marketing and Fundraising

This is one of the most critical steps. This decides the future of the project. When the community has given their vote of confidence, raising funds becomes easier. Gaining their vote of confidence is the toughest part. It only comes from how novel is the idea, how well implemented is the proof of concept, how effective is the marketing strategy. There are multiple ways to raise funds for a project: ICOs, bootstrapping, loan, angel investors, venture capitalists, etc.

Step 8: Hiring Staff

Once funding is settled, hiring staff to carry out the project on a larger scale is required. Recruiting the right talent is what makes the difference between an average company and a constantly-growing company.

The backbone of any company is its staff. They are the ones who do the actual work. Selecting the right team is very tricky and since blockchain is very new, finding the right talent is all the more difficult. Sometimes, networking is the best option to get the best of people.

Step 9: Launch Beta Version of Product

The real presence of a product can be felt in the market only when there is something a regular user can use. Mostly, the same PoC is enhanced a little more, and actual data is fed into it for the field trial.

Using this beta version, customer behavior can be analysed. New strategies for alpha version can be drawn out. Sometimes after using the beta product, the user realizes they want something more. This undreamt requirement change must be catered to in order to stay in the game. This sounds risky, but this is the changing point for any business. Customers acquired in this phase are loyal customers.

Step 10: Launch Production Ready App

This is the final stage, and higher than ever level of commitment is required. After the beta version of the app is thoroughly tested and studied, the production-ready version is designed. Implementation of the full-blown app may take a while which depends upon the expertise level working on it. The user interface must be as friendly as possible; the overall performance should be unmatched. Sometimes other future-tech like machine learning or internet of things are also integrated with the app to give the user a higher level of satisfaction. The business model can be revised in this phase; the app may be free or can be based upon subscription. Further iterations of the project will consider this version as the touchstone.

These ten steps will act as guiding light to take your business from no-blockchain to blockchain. In this time, everyone is competing to get ahead in the race of blockchain. Big conferences are being held almost every month which are great for making new connections. A lot of big companies like Microsoft, Amazon are already investing in this technology. As a thought leader, one must think about how to solve some pressing worldly issues using this technology. It promises to redefine the landscape of every economy in the world. Wouldn’t you want to try it?