Blockchain vs. Distributed Ledger Technologies Part 2: Governing Dynamics

Posted on May 24, 2018

Blockchain vs. Distributed Ledger Technologies Part 2: Governing Dynamics

It should be acknowledged that if database coordination and more efficient allocation of code is the desired functionality of a system, then blockchain may not necessarily be the solution for which an organization is looking. Distributed ledger technology (DLT) systems like IBM Fabric or R3 Corda are capable of similar functionalities as blockchain systems, but it should be taken into consideration that blockchains are a separate subset of distributed ledgers that have additional functionality beyond code coordination. Blockchains are capable of functions that distributed ledgers are not in terms of instantiation of digital value based on the composition of the system.

In this document, architectural considerations will be explored that identify the aspects that contribute toward blockchain functionality. An examination would be that perhaps there is a tradeoff between what blockchains are able to accomplish and what DLT’s provide. DLT was meant for transaction processing in a shared trusted environment while true blockchains were designed to sacrifice the need for a trusted setup in order to achieve high fidelity and immutability of accounts.

Aspects of high fidelity and immutability are integral for the success of properly digitizing assets. The analysis from this document will overlay architectural components across business processes in order to further elucidate these technological nuances across platforms.