What challenges does the blockchain pose for developers?

Blockchain solutions are a megatrend in IT that more and more companies are recognizing and implementing solutions in this direction or at least planning their introduction. In the digital transformation, the blockchain can be an important means of improving, automating and optimally digitizing processes in companies.

The use of blockchain solutions also poses challenges for developers. If those responsible in the company define goals for what the blockchain should offer, then developers have to implement these goals with apps and integrate the blockchain into the internal infrastructure.

The development of smart contracts and decentralized apps in the blockchain often works differently than the developers of other applications. Developers and those responsible in the company have to cope with the steep learning curve that the use of blockchain entails. Only then can a blockchain project be successfully implemented in the company.

Blockchains work decentrally. The data and apps of the blockchain are also stored in the blockchain. There is neither a central server nor an instance that centrally controls the blockchain. All participants form the blockchain and ensure that the transactions and data on the blockchain are transparently and securely available.

Programming with the blockchain

Often other programming languages ​​and environments are used when using the blockchain and not all development environments are able to serve as the basis for blockchain development. Standard environments and editors such as Microsoft Visual Studio Code can of course also be used as the development environment for smart contracts.

Visual Studio Code is available for free and also has an extension for Solidity . In principle, developers should deal with the topic of smart contracts and dApps and then decide which language and environment they want to use. There are a few other approaches besides Solidity.

With the ” ETHcode ” extension, code developed with Solidity and Vyper can be written, provided and managed in Visual Studio or Visual Studio Code. In addition, Microsoft is also making the Blockchain Development Kit for Ethereum available free of charge. This shows that there are many tools, frameworks and solutions that can be used to develop applications for blockchains.

In addition, there are tools directly from providers of blockchain solutions, such as Hyperledger . Before developing the first dApp and the first smart contract, there is a plan of which tools, languages ​​and platforms are to be used.

There is also the challenge of building an infrastructure for the blockchain, including interfaces to other applications in the company. The front end for users plays an important role and security and data protection must also be taken into account. In many cases, companies rely on private or public clouds when using the blockchain. Here, too, the corresponding knowledge must be available or developed by developers.

In addition, there are technologies for the operation of containers and their management. It is not enough just to deal with the blockchain, the accompanying technologies also play an important role and must be implemented in the environment.

The blockchain brings added value to companies

Blockchain technologies bring real added value to companies if the introduction is properly planned and the advantages of the blockchain are also made properly usable. Basically, it makes sense to sit down at the same table with those responsible in the company and also to involve users.

When using the blockchain, there is a lot of educational potential for almost every department. Often, even in IT departments, there is not enough knowledge about the possibilities blockchains offer and what needs to be considered when using them. In order for developers to be able to develop the appropriate apps for the application scenarios, the challenges of the blockchain must be mastered. Blockchain projects are hardly feasible without acceptance by those responsible and users, and the blockchain is no exception here.

For this reason, developers should concentrate on the performance of blockchains and the apps operated in them at an early stage. Tools like Hyperledger Caliper help with this. 

When using the blockchain, the same applies to all new technologies in companies. Users have to accept the new solution. For this it is important that this is easy to use, brings noticeable improvement and, above all, is always available with sufficient power. Users hardly understand when processes in a supply chain are slowed down because the smart contracts and transactions are not available with sufficient performance due to incorrect development.

Use distributed ledgers

The area of ​​distributed ledgers in a blockchain is particularly interesting for companies. Not all corporate applications are suitable for running in a public blockchain such as the Ethereum mainnet. Companies often use a smaller group, for example suppliers, customers and partner companies, to build a private blockchain.

This has the disadvantage that the transactions in the blockchain cannot be checked by millions of participants, as in a “real” blockchain (public blockchain). The advantage, however, is that companies retain control over which participants are allowed for their own distributed ledger (private blockchain). Data protection and security are also easier to control this way. When introducing the blockchain, companies often rely on private blockchains / distributed ledgers. The frameworks and tools from Hyperledger are used particularly frequently .

The terms blockchain and distributed ledgers are often mixed up. While the data records are stored in blocks in blockchains, the data records are stored consecutively in the distributed ledger. Blockchains are therefore a special form of a distributed ledger with a significantly higher number of participants.

The strengths of the blockchain lie in its decentralization. Private blockchains are less decentralized and therefore have some weaknesses in terms of security and data protection. Here it must be weighed up at an early stage in which direction the blockchain should be operated in the company.

The blockchain is constantly evolving

One of the biggest challenges in blockchain is that the technology is relatively young. The technique was described by Bitcoin inventor Satoshi Nakamoto in 2008. For this reason, the technology is neither fully developed nor extensively researched. Therefore, new information, areas of application, tools, and approaches emerge almost daily. Developers must therefore be prepared to adapt to the very dynamic further development of the blockchain.

There are always new tools, frameworks, and APIs. Not all of these solutions remain permanent or prevail. Developers, therefore, have to react flexibly and test new tools that may bring real added value. However, tools and frameworks that are no longer relevant should be replaced if possible. The development in the blockchain is constant and fast, developers in this area have to stay tuned in order not to bet on the wrong train.

Which tools and services will prevail?

If blockchain technology is to be used in a company, the question often arises which provider should be used. It is currently difficult to estimate which blockchains and which providers will prevail and which will disappear in the future. The tools and frameworks from Hyperledger are currently leading and the blockchain from Ethereum is also on the rise. But that can change quickly. In any case, it makes sense to deal with these two manufacturers.

Regardless of the blockchain used, the programming language naturally also plays a role. The tools and frameworks used are also in constant development, which professionals should be prepared for. New functions are introduced, others are no longer available.

The contract- oriented programming language Solidity is often used to write intelligent contracts if Ethereum is used as the platform. This shows the considerations that developers have to make when using a specific platform, framework or programming language for smart contracts. Also Vyper plays an important role in Ethereum. Both Solidy and Vyper are programming languages ​​that focus on smart contracts with Ethereum Virtual Machine.

Scaling the blockchain

If a blockchain project is successful in the company, it often has to be scaled very quickly. New partners and users must be able to use the application, and in many cases additional apps are connected at a later date.

The program code of the apps, the infrastructure used and of course the hardware as well as the lines in the network and Internet must be able to grow with them. Tools like Hyperledger Caliper help to optimize the source code of the dApps, smart contracts and other objects in the blockchain.

Transactions in the blockchain must be able to be processed quickly, even when there is a lot of use and during peak working hours. If the number of transactions per second (TPS) drops, it can be assumed that the acceptance of the blockchain will also decline because the processes in the company are slowed down too much. The processing time in blockchains is a big sticking point when it comes to implementing a successful blockchain project.

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Integrate off-chains technology

In many cases it does not make sense in a blockchain project to save all the data of a dApp and a smart contract in the blockchain itself. This is also not always ideal for reasons of data protection and security. Off-chain technologies enable data to be stored outside the blockchain, but usable in the blockchain and through the blockchain apps. Developers have to be prepared for this in good time and plan ahead.

Off-chain transactions generally run outside of the primary blockchain, but can be used in the primary blockchain. The use of off-chain technologies can significantly increase performance, data protection and security.

However, off-chain transactions contradict the fundamentals of blockchain technologies. Because actually all involved nodes in a blockchain should confirm the transactions and thus guarantee their authenticity. This shows that in the blockchain, compromises always have to be made in development. Basically, it corresponds most closely to the blockchain approach if public blockchains, such as the Ethereum mainnet, are used. Millions of nodes are involved here, guaranteeing transparency and security.

Private blockchains (distributed ledgers) are blockchains in a much smaller style with a rather small number of participants. This gives the operator control over who is on the blockchain and who has access to the data. However, transparency and protection against counterfeiting suffer from this.

Outsourcing transactions (off-chain) also removes data from the control of the blockchain. This increases data protection, as the participants can no longer see all the data, while transparency and protection against forgery are reduced at the same time.

The performance of a blockchain can also be improved by combining several, small transactions into one large transaction. Aggregating allows more transactions per second (TPS) to be performed.

APIs and collaboration with external systems

Blockchain applications are rarely operated as islands in the system but must be able to communicate with other applications. Here it is important to use APIs and to coordinate the cooperation. At the same time, there are security risks here, as attacks on the blockchain can also occur through external systems. For this reason, too, data security and data protection must be guaranteed for all connected systems.

If blockchain applications and data from an external database are used, the database represents a potential weak point that attackers can target in order to attack the blockchain itself. If companies rely completely on the decentralized approach of the blockchain, these weak points do not exist, but all data must be stored in the blockchain, which in turn is a data protection problem.

It should therefore be planned at an early stage in the development of applications that should exchange information with the blockchain under certain circumstances. This also applies to partner companies. Here, too, applications are in use that may have to work together with the blockchain. The earlier it is clear in a project which applications should be connected at what time, the right decisions can be made about which blockchain should be used, in which programming language the smart contracts and dApps should be developed, and which infrastructure should be used.