HomeArticlesWhat is Quorum Blockchain? Is it right for your business?
What is Quorum Blockchain? Is it right for your business?
December 3, 2019
American financial services and investment giant
JP Morgan has developed a blockchain. What is it and could it be the private blockchain your business has been waiting for? Hello and welcome back to the Akeo Tech channel where business and technology go together like a lock and key. My name is Louie Procopio and today we’ll be taking a closer look at JP Morgan’s Enterprise focused blockchain. It is open source, it’s a soft fork of the very well-known public Ethereum blockchain. It’s Quorum. Here at AKEO we are fascinated by all
things Tech and how they are shaping the future of business and money. Emerging
technologies like Big Data, virtual and augmented reality and machine learning are all topics we will discover more about here on the channel, but in due
time. So far on the channel we have been focused on a different emerging technology that is distributed ledger technologies or DLT as it is referred to
in the tech industry. Over the last few episodes we’ve taken a look at a couple of different enterprise focused blockchain solutions. Today is the third private blockchain we will be featuring here on the Akeo Tech Channel. Having already looked at Hyperledger Fabric and Corda which you can check out here if you
haven’t seen already. JP Morgan’s Quorum seems like a good next step to take. Quorum like Hyperledger Fabric and Corda is also a permissioned or a private blockchain. If you’re unsure about what a permission or private blockchain is, then please check out this video here before you continue on with this one. Don’t worry I will be here when you get back. So without further ado let’s dig in. Quorum is a soft fork of the public Ethereum blockchain meaning the vast majority of the overall Quorum solution is actually unchanged Ethereum
basecode. Some of the major issues when it comes to using the Ethereum blockchain as an enterprise solution are privacy, scalability and network performance. This is where the Quorum protocol comes in. The primary features of Quorum include privacy – transactions and smart contracts on the blockchain can be private allowing fine-grained access only to participants that are involved in a specific transaction or access to entities such as regulatory bodies. This is of course alpha-omega for any enterprise blockchain solution as having completely open and public ledger of transactions is not only unwanted but in many business cases illegal in the eyes of regulators. Quorum features multiple voting based consensus mechanisms which do away with the current proof of work consensus mechanism used today by the public Ethereum blockchain among many others. Quorum utilizes what is known as raft based and Istanbul Byzantine fault tolerance consensus mechanisms. Quorum allows for peer or node permissioning using smart contracts which ensures that only known parties can join the network. And the last but certainly not the least of these primary features of Quorum is increased scalability and network performance. It goes without saying that this is a very important feature to have in any enterprise grade blockchain solution especially one that is based on the notoriously poorly scalable and relatively slow performing public Ethereum blockchain. So how does JP Morgan and their Quorum developer community achieve these features to get a basic understanding of how it works? We need to take a look at the basic Quorum blockchain architecture which consists of two main components. First is the Quorum Node – this is the soft fork of what we know as the public Ethereum blockchain. Making Ethereum the basecode and adding a thin layer on top
which allows for those important modifications like using voting based consensus mechanisms instead of proof-of-work and allowing transactions
and smart contracts to be privately executed. The second component is known as Constellation – this is a two part system in which the primary application is to implement the privacy features of Quorum. So the first part of Constellation consists of Transaction Managers that are responsible for transaction privacy. A transaction manager stores and allows access to encrypted transaction data, exchanges encrypted payloads with other participants transaction managers, but they do not have access to any sensitive private keys. This is where the second part of constellation comes in – the Enclave works with the transaction manager to strengthen privacy by managing encryption and decryption in an isolated way. The Enclave stores private keys and is essentially a virtual HSM or Hardware Security Module which is an encryption method not at all new to the business tech world. So to very quickly sum it up
JP Morgan’s Quorum solves the privacy and performance issues that public blockchains like Ethereum presents not just the financial sector but just about every enterprise use case of blockchain. If you’ve been following along for the last few weeks then you might be noticing a trend in the features provided by these different blockchain solutions that we’ve covered. Privacy, immutability through coded trust, scaling, performance, regulation ready. All
these issues are being tackled by these different blockchain projects. But one very important question still remains. Which private blockchain is the right one for your business? In the next episode on the Akeo Tech channel this is the question that I want to help you answer. To give you the best possible comparison we are gonna hop over next week. So I’ll be back in two weeks to answer this question.
One thing I do want to mention now there are a lot of different blockchain projects out there that we haven’t even began to look at. But, this channel is not really meant to feature every blockchain project out there. Hyperledger Fabric, Corda, Quorum are those projects that I decided that we should focus on and for very good reasons which we will get into in a couple of weeks. All provide very similar features but with very different architectural foundations and very different communities of developers and support. Which brings me to this week’s critical thinking question. Your business is in the process of choosing a technical blockchain solution. The two choices you are deciding between seem to be identical on paper. What other important aspect of these two blockchains can you compare to help you make your technical decision? There it is feel free to start a discussion in the comments section. This week there is no one right or wrong answer so if you are brave enough please share with the rest of us what you feel, you would be focused on if you had two projects that were exactly the same on paper what would you compare that? Are you interested in learning more about how blockchain is being used today and what problems businesses are trying to solve with this technology. Then head on over to Akeo.Tech, where you can download your free blockchain ebook for business professionals. Are you enjoying the
content here on the Akeo Tech channel. I hope you are subscribe, like this video,
share this channel with your family, your friends, your colleagues. Help us to
spread this valuable information, so we can all do our part to assist in global blockchain adoption. Thanks again for watching I’ll see you in a couple of weeks when we take a side by side by side look at what we believe are the top three
blockchain projects out there. We’ll be comparing Hyperledger Fabric hosted by the Linux Foundation, Corda supported by industry
organizations like Amazon Web Services Intel and Microsoft and of course
JP Morgan’s Quorum Thanks again for watching Bye Bye