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What is Enterprise Blockchain

Blockchain vs. Database

The knack for embracing new technology trends quickly and the urge to bring something extraordinary out of the box solutions sometimes become taxing for enterprises. But will that keep those enterprises safe from their competitors? Well, the answer is no!

But what concerns enterprises from adopting new technology is their dearth of information, their way of functioning, and how it can make a difference to their businesses. One such dilemma is whether to continue with Traditional Database management systems or adopt the new blockchain development services to leverage its potential.

So, here in this article on Blockchain vs. Database, we will be spilling the facts about both the technologies, how they can be leveraged, and discuss their potential use cases.

What is Blockchain?

Blockchain is a Distributed Ledger Technology (DLT) that allows a set of users to work together to create a unified decentralized network. These users can communicate with each other to share information or data with the aid of the consensus algorithm. The Blockchain's central governing authority is absent to make the whole network trustworthy.

When we talk technically, the term will be, Blockchain is a growing list of records, called blocks, that are linked using cryptography, and each block refers to the previous block, where together they make the Blockchain. Various validation mechanisms like Proof-of-Work (PoW) and Proof-of-History (PoH) are present, which are used to validate the work, as it ensures that no invalid transactions are passed into the Blockchain network. Blocks are the most important part here as they store transactions and other important information required to operate the Blockchain successfully.

Further timestamps are created to ensure that each transaction can be traced easily, backed, and verified by any participant on the network. This whole system works to add value and brings in transparency, immutability, and security.

Blockchain is not just some random technology but also the next generation of the tech revolution that has found varied applications daily. Blockchain is one of the emerging technologies to make inroads into various sectors due to its numerous important factors, and it is one of the most promising technologies to revolutionize the world.

What Is a Traditional Database?

The Traditional Database is a centralized ledger run by an administrator, and they inhibit some of those unique features along with regular read and write features. In the traditional database, the parties having proper access can read and write.

A Traditional Database can be modified, managed, and controlled by an administrator known as DB Admin, who has complete control of the database. The administrator can perform various functions like optimizing database performance and managing its size to more manageable levels. Generally, admins run optimization methods to improve performance as a large database tends to get slow in terms of performance.

What is a Blockchain database?

As of lately, there have been rumors about Blockchain Database, but do Blockchain databases exist, or is it just a database? To answer this, you have to go back and think that Blockchains appear quite sophisticated and complex, but actually, they are not. Blockchain appears to be like databases structurally, but in functionality, they are different. In Blockchains, the blocks are all important as they are data structures called blocks that store data. While in a database, the information gets stored using data structure tables.

It is worth noting that every Blockchain can be considered a database, but not every database can be considered a Blockchain. So, a Blockchain database does exist in the form of a Blockchain Data Structure.

Initially, Traditional Databases worked as flat-file hierarchical systems that provided digital storage for simple information gathering. With further time the databases allowed more complex ways of gathering data by relating information from multiple databases, which incorporated and leveraged a relational model.

The stored data can be queried from the Database using a special querying language known as Structured Query Language (SQL). In modern times a database can work with almost every type of data structure and can be found to support all modern enterprises where it is scaled to support millions of records.

Blockchain vs. Database: What’s the Difference?

Decentralized Control

Blockchain is decentralized, allowing different parties to share information without requiring a central administrator. In Blockchain, the consensus mechanism plays a major role, whereas, in Databases, the case is completely different. In the Database, the central administrator is needed, as the consensus system is not present here. The basic intellect of one individual admin works in the Database in the place of the combined intellects of a zillion individuals plays a role in Blockchain technology.

History of Itself

In the case of Traditional Databases, it is worth noting that they record only the present information; they become useless when you try to track previously recorded information. Well, for the Blockchains, it’s quite different as they keep the updated information and the information about the transactions that date back to the time. Blockchains grow like ever-increasing archives of their history, where they can create databases that have histories of themselves.

Performance

In terms of performance, it is known that Blockchains are already used as systems of records, and when you use them as a transaction platform, they tend to become slow. Compared to them, Databases have been offering almost the same functions with much faster speeds and have been around for decades. Databases have seen their speeds surging in multiples, but as of now, Blockchains, too, are having their share of improvements in the technology to compete.

Confidentiality

The Blockchain that is permission is somewhat like a centralized database, which can be both written and read-controlled, but in that case, the confidentiality, centralized Database wins the race.

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What Should Be the Ideal Startup Choice? Blockchain vs. Database?

Here Are a Few Cons of Choosing a Database

Customization for Better UX

Centralized Databases can be customized by the administrator as per the business requirements. These Databases can be merged into the master database for queries and reports, or they can be distributed further. Their features are robust when developers go for app development to give users a better and friendlier user experience.

Stability

A Database, when managed efficiently, can handle large volumes of data and process thousands of transactions per second. Since they are permissioned, they are fast as granting access to write operations only to a select few, and the data is recorded to a few servers in the form of data structures. When the same information is sought, it can be made available to umpteen users. If a powerful server is made available, it can process data at the backend while a frontend host provides an interface, and speed can be configured by hardware using RAID Level 1 or through sharding and shrinking, which are other techniques. Further, the security and full management of the system is taken care of by the administrator, who can retrieve data in case a disaster happens.

Speed and Volume

Both volume and speed are well-taken care of in the Database in the form of data structures. As of now, the Database management system is well designed to sustain the load and is suited for critical enterprise operations.

What Are the Advantages of Choosing a Blockchain

Decentralization

One of the best features of Blockchain technology is that they are decentralized, making them highly resistant to a fault. In Blockchain, the crashing of a single node won’t affect the functionality of the network as a whole as there are other nodes present to run the Blockchain. This decentralization feature works wonders in the case of security, as the information stored on one computer must be copied to all nodes in the network. In short, a hacker must hack all the nodes to alter the information to manipulate data. This is a good safeguard in deterring attacks against the system and a deterrent for the hacker.

Immutability

Any data stored over Blockchain is immutable, as it can’t be changed once a block has been validated. In short, they are resistant to tampering and manipulation because the information is recorded on a digital public ledger stored on many nodes. Now to change the information, the hacker needs to change that information in all the nodes on the network, which is practically not viable.

Transparency

Transparency is another key benefit that Blockchain developers offer, as everything is recorded here, and Blockchain is free from censorship. Information over Blockchain cannot be hidden as it’s a distributed ledger system. Therefore this fosters more trust and adds value to the system. Blockchain technology, in general, is permissionless; hence, to use Blockchain, there is no restriction, and it is an open platform for all in a public environment.

Security

Using advanced cryptographic methods over a distributed decentralized network makes Blockchain a secure environment. As mentioned above, any sort of modification of the data structure in the network requires expending plenty of compute resources. The complete modification of data over all the nodes is also not practical, so hacking seems uneconomical. Due to the nature of Blockchain, the rogue miners and hackers do not get fruitful results.

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Some Real-life Use Cases of Blockchain and Database

Database Real-life Use Cases

A database system is well suited for operations in enterprises, as they are well proven their user friendly to users and have many supported management systems for administrators and developers. The Database backed systems are also used by fortune 500 companies to run their high-end systems dealing with large volumes of data. A system that intends to deal with a high traffic volume, like in the retail industry or stock markets, is ideally suited to operate upon a database.

A Database does not need to interact with other nodes like a Blockchain-based system, nor does it needs to encrypt or hash every piece of data it stores. Databases store unencrypted information as encryption adds a lot of overhead in a live database, but in the traditional database, permission is a security feature where encryption happens for an archived database.

A Database Can Be Ideally Suited for –

Active monitoring and sensor processes, where data gets updated continuously

  • Instant online transactions.
  • Confidential information records.
  • Those data processing mechanisms require fast updates.
  • Simple data that do not require verification.
  • Relational data.
  • Standalone applications for plain data storage.

Blockchain Real-life Use Cases

The basic qualities of Blockchain technology are to establish trust and transparency, as being a public ledger system, it allows access to everyone for the information. Blockchain proves its worth in places where there is a need for validating information, as in the case of B2B Business-to-Business transactions related to supply chain, distribution, and inventory. Blockchain can help when there is a need to track and prevent fraud.

Another thing is that Blockchains are non-relational as different types of Blockchains can’t be joined to relate the data in them together. Therefore, two different Blockchain platforms can’t operate together, and when information needs to be relational, a blockchain will not be suitable for it. Recently some new Blockchain platforms allow interoperability; those can be in both private and permissioned environments and sometimes integrated with traditional databases to form a hybrid system.

Smart Contracts are an important feature in Blockchain that are used as triggers to execute code to process a transaction, which is much similar to stored procedures in the Database. Smart Contracts are used differently by different platforms; Ethereum uses a smart contract executed as bytecode on all nodes in the network. While the platforms like EOS and NEO use Blockchain for their Smart Contract ecosystem, this is a real use case of how Blockchains can be used differently from traditional Databases.

A Blockchain Can Be Ideally Suited for –

Financial transactions Transfer of value

Verify data for trustworthiness like Identity, Credibility, Integrity, etc.

Voting mechanism

Authorization works

Decentralized Apps (dApps)

Conclusion

Well, in the choice of Blockchain vs. Database, picking out your next data storage technology is not that tedious, as we have discussed the qualities of each along with the differences.

Blockchain and Database are winners in their respective areas as both have inherent qualities where they outshine each other. The Database steals the show in utility, speed, and accuracy, while Blockchain aces innovation, verification, and automation.

Blockchain experts claim that in terms of work where fast execution is needed, Blockchain must be avoided, as Blockchain introduces a performance penalty because of its verification method. In this scenario, Databases are great, as the critical business process needs to be supported or scaled simultaneously. To work with a general-purpose application, databases are far more desirable as Blockchain's read and write process is not that simple.

Choose Blockchain technology if you are looking for data integrity, trust, transparency, and verification at stringent levels as the basic nature of that technology. It’s not that one is better than the other, but here both are better in their perspective. What matters is how you want your data to be executed and what you want to achieve from it.

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