Major cloud service providers are showing increased interest in joining blockchain networks.
Blockchain is going through a critical turning point, moving from an emerging technology to a useful business tool that companies want to incorporate into their existing IT tools. As more companies continue to explore how blockchain can help achieve the digital transformation, leading cloud service providers are showing increased interest.
For example, Google Cloud recently became a producer of network blocks by joining the EOS blockchain community. Block producers in EOS are chosen by token holders to add transactions to blocks, add blocks to the block chain and implement software changes.
While Google Cloud has yet to be chosen to become one of the 21 active EOS block producers, Allen Day, a Google Cloud developer advocate, told Cointelegraph that Google is very interested in open source protocols and distributed registry technology, or DLT:
„We are seeing active business participation in these types of networks and believe that the Google Cloud can reduce the friction for companies to run their own Google Cloud hosted nodes on the network. We are also providing cloud infrastructure to Block.one, helping them to host their own development efforts“.
Earlier this year, Google Cloud also joined the Hedera Hashgraph board of directors, enabling Google Cloud to operate a Hedera network node. According to Day, Hedera’s ledger data is now available for analysis along with other data sets from the Google Cloud Platform’s public distributed ledger. Google Cloud also runs a validator node for Theta Network, a decentralised video platform.
In addition to Google Cloud’s DLT support, Amazon Web Services is listed as a cloud service provider for China’s blockchain-based service network, a government-backed initiative designed to help small and medium businesses create and deploy blockchain applications. It is also notable that Microsoft announced that it would integrate the Lition blockchain into its Azure Cloud market.
Cloud and DLT technology enable digital transformation
According to Day, DLTs, as a blockchain, are enabling digital transformation. As such, Google wants to raise awareness of how companies can benefit from actively participating in blockchain networks. Specifically, Google Cloud is increasing its own security measures by participating in blockchain networks. Day explained that Google Cloud will take advantage of advanced security measures in EOS and is building security through progressive layers to provide in-depth defence:
„We don’t assume any trust between services and we use multiple mechanisms to establish and maintain trust. Data stored on our Google infrastructure is automatically encrypted at rest and Internet communications with our cloud services are encrypted“.
Kevin Rose, Senior Vice President of Public Engagement for Blockchain at Block.one, the company behind EOS, told Cointelegraph that Google’s participation in EOS will enable new business models for both parties to drive the digital economy.
Alistair Rennie, CEO of IBM Blockchain, told Cointelegraph that blockchain and cloud technologies work quite well together, „Blockchain offers the element of trust that is missing and that cloud technology alone cannot provide,“ he said. „Cloud providers are increasingly interested in Blockchain as a means of enabling greater trust and seamless collaboration between disparate stakeholders“.
Will large enterprises take centralisation to blockchain?
As major cloud service providers join the blockchain revolution, community members may question the impact this could have on a decentralised ecosystem.
Despite this, as the blockchain space continues to mature, it seems that big players like Google, Amazon and Microsoft are being welcomed. Konstantin Richter, founder and CEO of Blockdaemon, a multi-chain cloud-based network management tool, told Cointelegraph that EOS has previously faced scrutiny for lack of diversity among its block producers. However, Richter explained that bringing Google Cloud to the EOS community should certainly help the ecosystem generate more traction:
„It is important to allow participation and allow degrees of decentralisation to create a more efficient, fair and open financial system, as this is a strict requirement for accountability and data validity. We strive to enable decentralisation at the infrastructure level, but we are not replacing a pure diverse set of node owners“.
Echoing Richter, Drew Saunders, founder and CEO of PAC Global, a decentralised storage platform, told Cointelegraph that a reliable blockchain contribution is needed regardless of the individuals or companies involved. Saunders commented that the Google Cloud is known for its reliability and that EOS already has a large, decentralized user base that supports the network.
But given that the EOS network is based on 21 block producers that must be voted on by token holders, it seems that concerns about a block producer or node validator not fulfilling governance functions should not result in network failure. Furthermore, it is important to bear in mind that Google Cloud has not yet been elected. Rose mentioned that the Google Cloud could be voted on quickly if the EOS token holders believe it is necessary:
„It really depends on the Google Cloud and what their plans are for interacting with the EOS Network community. And because voting in the EOS is open and continuous, to ensure that the top 21 is always a real-time reflection of the aggregate will of the EOS token holders, we will constantly evaluate the Google Cloud against our criteria, just as we do with all the Block Producer candidates“.