We know what you’re thinking, “didn’t we just go over this last week?” And while you are close, that was blockchain Infrastructure as a Service (IaaS). This article is about just plain ol’ Blockchain as a Service (BaaS). And while they’re easy to get confused — both are blockchain service offerings, and their acronyms are similar — we’ll explain to you the difference.
Perhaps you already know the difference, in which case we prepared this handy table of contents so you can jump to the part of the article that interests you. Or stick around for the whole thing and learn more about blockchain service offerings.
Blockchain technology has been a dark horse in the technology sphere for years. The community behind it believes in it completely and is fiercely loyal. And we’ve watched as blockchain has slowly risen in popularity, and then seemingly exploded in the last few years. This technology is new, and therefore has so much potential — no one really knows where it will go.
Which is why many people want to explore blockchain’s possibilities and capabilities to see if they can carve out their own place in this rapidly expanding world. That’s where IaaS and BaaS providers come in, they help bridge the gap for everyone who wants to try this technology. The difference is IaaS allows customers access to pricey and complicated blockchain node infrastructure, while Blockchain as a Service allows customers to develop on the blockchain easier.
Blockchain as a Service are cloud-based services that are used to develop, use, and host a customer’s blockchain needs such as apps and smart contracts. Think of it this way, BaaS enables developers to easily build a dapp on distributed servers by bringing in software services.
These software services can encompass a lot, but include things like node infrastructure, blockchain oracles, Internet of Things (IoT), Artificial Intelligence(AI) and machine learning, and DeFi and NFT minting services.
If you want to build a dapp on the Ethereum network, traditionally you’d have to know all about blockchain programming in order to do that. So to make it easier, BaaS providers lend you software services so that you can quickly and efficiently build your dapp, without needing a degree in computer science.
These software services often include access to blockchain infrastructure that is critical to building a dApp, and they are often available in templates or packages that allow you to choose the best format for the dApp you would like to build. Some even have “no code” or “low code” solutions so that there is even less of a barrier in being able to build your own blockchain app.
An example of this is Pontem Blocks, which are blocks of pre-set values that you can combine to build and create your own DeFi tools on the blockchain. Because these blocks have already been developed, you can simply put together the blocks that serve your needs the best to create your own custom tool. By giving you pre-developed blocks to create with, Pontem lends you software services so you can create things like your own NFT.
In exchange for utility tokens, Blockchain as a Service providers give developers a framework on which to build blockchain apps, functions, and smart contracts. Since smart contracts are needed to run the BaaS infrastructure that developers use, the utility tokens are used to pay for the running and execution of them. The BaaS provider has already developed complete tool sets and an intuitive UI for users to develop their own dApp projects, most of which are custom presets, so you pay money to build your own dApp smoothly.
Let’s talk about that dApp you wanted to build on the Ethereum blockchain again, but we’ll get more specific. Say you wanted to build a financial tool that utilizes smart contracts for security. The BaaS provider has an already created toolset so that you can set up your financial tool quickly, they provide much of the coding work for you so that you can deploy your dApp quickly.
The three main advantages of BaaS are that it is cost effective, easy to use, and requires little blockchain knowledge on your behalf.
To create your own self-hosted blockchain app, the costs would be high — which deters many people with dApp ideas because not only does their idea require a lot of money to make, it also requires a lot of money to maintain.
You need blockchain infrastructure, programmers, software, hardware, licensing, consulting, bandwidth expenses, security, and on and on and on. All of this can easily add up to hundreds of thousands of dollars.
To create your own dapp with a blockchain as a service provider, you ease that burden by letting the provider maintain the software services your dApp is using doing most of that for you in exchange for a fee. As long as the platform allows a good degree of customization, using a blockchain as a service provider to help bring your dApp to life is incredibly cost effective since it is way more expensive to keep a whole team of experts to continually update and manage the software themselves..
Blockchain apps, especially once you start adding more features, are incredibly complicated technology that can take months, even years to develop to the point where they can be used by a larger audience. With blockchain as a service, because they offer preconstructed tool sets and customizable templates, you can build your dApp quickly and efficiently. Much of the start-up needs of your dApp are covered by this convenient service.
Like a managed website hosting platform like Wordpress or Wix, Blockchain as a Service providers have customizable templates and tool sets already ready for you to plug-and-play and create your own dApp. This allows you to focus on your business and the front end development, and all you have to worry about is if the template fits your dApp needs. You can choose the template that will best fit your product, and then change it if your product grows and develops new needs.
We’ve talked a lot about how much knowledge you’d need to create your own self-hosted blockchain app. It’s so much that blockchain developers earn an average of $150k-$175k a year and are in high demand, yet low supply. Kind of sounds like a most famous crypto, does it not?
But it can take years to develop all that knowledge, not to mention all the money you’d need to acquire it. Blockchain as a Service allows you to build a dApp without that knowledge because they’ve condensed it and provided tools for you. Now they’ve cut your development time by a significant amount. But don’t be fooled, you’ll still need some knowledge of how blockchains and dApps work, but much less than if you were to develop on your own.
The disadvantages of BaaS are that because you didn’t do the back end development, if something goes wrong you lack control, and business continuity could be in question if your provider shuts down or changes their terms.
The cloud-based services model that allows you to customize and build a dApp easily makes the backend easy for you, but when something backend related goes wrong, you don’t really have control over fixing the technical issue. Your dApp users will come to you first to fix the technical issue, and you’ll have to contact the BaaS provider. This could lead to delays and mistrust from your users if it happens often.
Another downside of placing your trust in a blockchain as a service platform is that you’re building your business on it, and when you make your agreement, you need their continuity and longevity as their own company for yours to survive. This means that if your provider somehow goes bankrupt or fails to keep up their end of your bargain by maintaining their infrastructure and adding new features, the disruptions to your service could be costly.
Both of these disadvantages can be mitigated though, simply by carefully selecting the platform you build on or choosing a platform that doesn’t lock you in. Blockchain lock in is when you are tied to the use of just one blockchain. So now when the Ethereum fees are high, it’s a risk because you’re locked into that blockchain.
By choosing a platform that is “blockchain agnostic”, you mitigate the issues presented when you only stick with one blockchain. You have use of multiple chains, so if one network is down or the fees are astronomical, you have options that work around that.
Choosing the right provider for you is crucial because this is the foundation you are building your app and business on. With the right provider, your experience can be smooth and hassle-free, and give you exactly what you’re looking for. There’s a lot that goes into choosing the right platform, so we’ve condensed it down to the main factors you want to look at.
One of the first things you want to look at when looking for a provider is their reputation and their experience. How long have they been providing services? Who are their current clients? Do they have some scandals under their belt or do they have a clean track record? Look at what they are known for, some specialize in certain areas or blockchains, some are known for better security or more customization. If they have satisfied clients and a clean reputation, they’re a company worth looking at.
If they are a relatively new company, look at what the early users and investors are saying and the company’s roadmap. Do they have sponsors and investors? Many up-and-coming companies show a lot of promise.
Smart contracts are exclusive to the blockchain, and one of the draws of building a dApp on it. Smart contracts not only include the terms of the contract, they also enforce them, giving penalties in case one of the parties breaks the terms. This is complicated technology that is necessary for many business deals on the blockchain. It’s key to understand if you will be using smart contracts, and pick a provider according to their smart contract integration.
Ethereum is not the only blockchain that can host dApps, and this affords you so many more options. When choosing a provider, make sure they offer deployment on the blockchain you are interested in using, and that they are using the same framework you will use for your dApp.
Price is obviously an important factor. You want to be paying for quality service, but so that it falls within your budget. And because you are using a third-party to help deploy a dApp, look for a provider with good customer support. God forbid technical issues arise on their end and you can’t solve it because they don’t have great support.
Here are some of the most:
An industry leader all across the board, AWS integrates blockchain-based networks and business processes for some of the largest companies in the world. They deploy their BaaS on the Ethereum and Hyperledger Fabric. You can build with a free tier for a year, and launch a dApp in a few minutes by watching short tutorials. As a note to add, AWS is a centralized service, meaning that they create, own, and control their software service offerings.
Blockstream’s BaaS allows for the creation of scalable solutions for the Bitcoin ecosystem and protocol. Their technology is accelerating the adoption of Bitcoin-based peer-to-peer finance. They enable the introduction of new features to Bitcoin and the issuance of new digital assets by using sidechains.
Leeway Hertz is unique in that they not only offer you a way to build your dApp, they also offer blockchain consulting to help you develop your idea and analyse the potential of blockchain for your business case. They have a whole process to get your dApp from idea to deployment.
Pontem is a BaaS provider that provides a bridge between the regulated and unregulated crypto worlds. Pontem allows users to build, test, and deploy dApps on the Polkadot blockchain to test market fit before they then can deploy dApps on Facebook’s permissioned Diem blockchain. Unlike AWS, which is a centralized solution, Pontem utilizes software services from other partners, like node infrastructure from Pinknode and oracle services from ORAO, to add to the decentralization of the platform.
VironIT is another big software development company that has a blockchain division. From the consulting stage to deployment, you can walk all the steps with VironIT. They offer a multitude of BaaS so that you can do anything from smart contract development, blockchain development, even mobile apps with blockchain integration and more.
You want to build your dApp, you have to choose which blockchain to build your dApp on. There are many public blockchains, but having access to a private blockchain, like the Facebook-backed Diem blockchain, would give you access to Facebook’s over 3.1 billion users. So how do you develop a dApp for this ecosystem? Pontem is one way.
Pontem Network allows users to connect to third-party software services, like Pinknode and ORAO, and use no-code tools to build dApps, then test them for market fit on the Polkadot blockchain. But thanks to a fully compatible Move virtual machine, developers can easily port their viable projects to Facebook Diem’s permissioned blockchain, which is built with the Move language.
Pontem is the much needed bridge connecting the unregulated crypto world with Facebook’s permissioned blockchain. This makes the DeFi world and its emerging use cases accessible to Facebook’s users, and also gives developers a chance to develop their tools and test them for market fit in the Polkadot ecosystem first.
By bridging these two worlds, Pontem is speeding up the rate of crypto adoption by removing barriers, and giving developers the chance to build on blockchains without needing prior coding experience.
Blockchain as a Service is another crucial element in the journey to mass blockchain adoption. With the ability to create and deploy dApps easier, millions of developers that use services like AWS will be able to easily build decentralized applications. BaaS makes creating a blockchain app easier than ever before, and it cuts out the expense of having to do it all yourself; it bridges the gap between the knowledge and funds to create a dApp, and the people who have amazing ideas they want to implement.
Which is why Pontem is proud to be the bridge between the permissioned and unpermissioned blockchain worlds. Being this bridge is an exciting step to making blockchain apps and services accessible to everyone, both to use and create.
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