Blockchain as a Service (BaaS) allows customers to leverage provider functionality to build, host
and execute blockchain applications and smart contracts within a cloud formation.The cloud based service provider
manages all the necessary tasks and activities to keep the infrastructure operational and scalable, allowing the customer to focus
on their development efforts. This concept works similar to the currently widely accepted concept of Software As A Service (SaaS) model.
In many cases BaaS this is an ideal scenario as it allows the customer to "experiment" with the blockchain with a
minimum amount of effort.
Who are some Blockchain as a Service providers ?
Microsoft became one of the first software vendors to offer BaaS when it launched Azure Blockchain Service in 2015. In 2017 it
launched Enterprise Smart Contracts, which provides users with the schema, logic, external sources, ledger, and contract
binding for building their own blockchain services.In November 2015, Microsoft and ConsenSys announced a partnership to create Ethereum
blockchain as a service (EBaaS) on Microsoft Azure. The service is designed to help customers build private-, public- and consortium-based
blockchain environments on Azure’s global platform.
Learn more about Microsoft's Blockchain as a Service
SAP's blockchain as a service, known as "Leonardo," is based on Hyperledger, and resides in the SAP Cloud service,
so it can be accessed from any device and requires no on-premises hardware or software. SAP Leonardo functions as a blockchain cloud service,
machine learning service and supports the Internet of Things (IoT) in a single ecosystem.
Learn more about SAP Blockchain as a Service solution
IBM hyperledger blockchain Platform leverages capabilities built on the Hyperledger fabric framework and uses the Hyperledger Composer
Blockchain tool. Both are provided by the Linux Foundation as open source software. APIs are available to integrate blockchain technology into
the company's own applications. IBM promises that its own blockchain technology can be quickly and easily integrated, even by developers who
are not yet specialized in this area.
Learn more about IBM's Blockchain as a Service solution
What are some advantages of Blockchain as a Service?
The BaaS model allows all types of businesses to access blockchain based technology
without having to invest in developing it in-house first.
Offers companies massive scalability both upward and outward.
Cloud technology is a mature technology with an abundance of documentation, on line training and resources.
Utilize blockchain technology on a subscription-based model - "Pay only for what was used".
Reduced power, maintenance and infrastructure costs.
Are there disadvantages to BaaS?
The BaaS model requires a certain amount of centralization as transactions will now be channeled through the blockchain services provider.
Unfortunately this approach now breaks one of the core tenants of blockchain - decentralization.
Since decentralization is one of the key features that makes blockchain so useful, companies should reconsider if in fact BaaS is
the right solution to their problem.
When considering BaaS, it should be remembered that an additional set of cloud skills will be required to understand
how to setup, deploy and maintain the blockchain instance in a given cloud formation.
All cloud providers determine cost to be billed to the customer based on a combination of computing power that has been configured,
power on time, and number of instances that are running. Customers will need to closely monitor these 3 factors in order to
minimum operating costs.