WEF States Blockchain Lacks Interoperability for Enterprise Use!
Over the past few years, Blockchain technology combination has developed within a vast number of industries. As such, there are now hundreds of distinct blockchain networks in service all over the world. For the most part, nevertheless, most of these Blockchains are not capable of communicating with each other in a way that offers effective use for enterprise solutions. According to the WEF (World Economic Forum), the recent level of blockchain interoperability is still too low for such implementations.
The WEF issued a white paper on blockchain interoperability as part of its more comprehensive investigation into blockchain deployment for supply chains. Written in association with the Big Four accounting firm, Deloitte, the paper emphasizes the requirement for interoperability. It explores the extent to which various blockchains can communicate with each other in their present states.
Interoperability for private Blockchain networks remains immature
According to the WEF’s findings, the blockchain interoperability difficulty has been originally discussed in the context of public blockchains. Private, or permissioned blockchains, have been reportedly left out as a result.
In the report, the WEF described that most interoperability solutions concentrate on two significant public blockchains — Ethereum (ETH) and Bitcoin (BTC) — while inadequate development activity has been seen as it links to permissioned blockchain platforms.
The WEF wrote, “In public blockchains, interoperability has been in development for many years – for instance, cross-chain, sidechains, proxy tokens, etc. However, a bigger challenge and, at the same time, a much bigger opportunity exists given interoperability among enterprise-grade permissioned blockchains.” The WEF highlighted that the recent interoperability level for blockchain-to-blockchain solutions “remains immature for enterprise use.”
In the report, the WEF and Deloitte named different blockchain platforms, and tech firms concentrated on interoperability issues, including significant industry projects like Cosmos and Polkadot. Nevertheless, the foundation still pointed out that relay interoperability systems like both Cosmos and Polkadot have been utilized only for permissionless blockchains. They say that “none has succeeded in creating interoperability for blockchain platforms other than Bitcoin and Ethereum.”
The organization also drafted that Hedera Hashgraph’s blockchain network, Hedera Consensus Service, which launched in February 2020, “appears promising for blockchain-to-blockchain interoperability.” The WEF wrote that the platform allows introducing a cost-effective and efficient ordering service to any Hyperledger Fabric network.
Additionally, the WEF estimated blockchain interoperability work by global tech giants. Microsoft is the only industry giant to launch blockchain interoperability solutions so far amongst large technology vendors such as SAP, IBM, and ORACLE, according to the organisation. Expressly, the WEF referred to Microsoft’s collaboration with Nasdaq to build a solution for the Nasdaq Financial Framework. This framework allows users to deploy various blockchains through one familiar interface.
There will be no mass adoption without blockchain interoperability
Blockchain networks are remaining principally secluded so far, despite several projects actively operating on blockchain interoperability solutions. In November 2019, Joseph Lubin, co-founder of Ethereum and founder of Consensys, expressed the desire that China’s much-anticipated Central Bank Digital Currency would provide for interoperability with public permissionless blockchains, including Ethereum.