Blockchain for Modern Business Applications · Title: Oracle Blockchain Cloud Service Author: David...

Copyright © 2017, Oracle and/or its affiliates. All rights reserved.Copyright © 2018, Oracle and/or its affiliates. All rights reserved. 1

Blockchain for Modern Business Applications

March 20th, 2018

ABC Blockchain Breakfast UpdateAmerican Business CouncilCapital Club, DIFC

Copyright © 2017, Oracle and/or its affiliates. All rights reserved.

Safe Harbor Statement

The following is intended to outline our general product direction. It is intended for information purposes only, and may not be incorporated into any contract. It is not a commitment to deliver any material, code, or functionality, and should not be relied upon in making purchasing decisions. The development, release, and timing of any features or functionality described for Oracle’s products remains at the sole discretion of Oracle.

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The Business Value of Blockchain

"The technology most likely to change the next decade of business is not the social web, big data, the cloud, robotics, or even artificial intelligence. It’s the blockchain...“

—Harvard Business Review"The Impact of Blockchain Goes Beyond Financial Services,"

“$176 billion in added business value by 2025; that total reaches $3.1 trillion by 2030.”

“10% of the Global GDP will be stored in blockchain technology by 2027”1


The Promise of Blockchain

"We are in the process of developing a new operating system for the planet.”

— Jeremy Wilson Vice Chairman of Corporate Banking

Barclay’s BankBlockchain for Finance conference,

October 2017

“$176 billion in added business value by 2025; that total reaches $3.1 trillion by 2030.”

“10% of the Global GDP will be stored in blockchain technology by 2027”1

Copyright © 2017, Oracle and/or its affiliates. All rights reserved. 6Copyright © 2017, Oracle and/or its affiliates. All rights reserved. 6

Blockchain OpportunitiesChallenges At the Enterprise Boundary

• Avoiding the cost and risks of intermediaries

• Manual, error-prone information exchange and

processes across enterprise boundaries

• High cost and delays of offline reconciliations

• Poor audit trail due to cross-ERP discrepancies

• High risk & cost of fraud in cross-company transactions

• Lack of real-time information visibility

Shipment• Exceptions• Paperwork

Customs• Acceptance• Compliance


Associate Mfg.• Assembly• Test Certifications

• Acceptance• Payment

Vision Operations

Raw Materials Producer

EDIFTP

Simulator

SCM Cloud


Similar Problems Exist Inside Enterprise

• Multiple silos of ERP or SOR systems

• Intercompany processing between multiple entities

• Lack of real-time information visibility between divisions or units in different countries or provinces

• Easier to tackle internal challenges first before trying to deal with other companies


Blockchain is a system:

• That maintains a distributed ledger in a peer-to-peer network

• That allows multiple parties that may not fully trust one another to do business securely

• That reduces the need for third-party intermediaries

• That enables real-time & unalterable records replicated among participants

What is Blockchain?

DISTRIBUTED LEDGER

CONSENSUS

SMART CONTRACTS

PRIVACY


Buzzwords You Might Hear

• Distributed Ledger Technology (DLT)• Smart Contract• Nodes• Immutable• Non-repudiation• Peer to Peer• Ethereum• HyperLedger• Corda• Decentralized• Consensus• Cryptocurrency

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Blockchain is decentralized in natureTraditional Database

When the central organization fails, the whole network can be become inaccessible

Blockchain

All data is connected and controlled by a centralized organization.

• Limited access by one or more person to same set of data

• Bottlenecks can occur with high traffic

• Highly dependent of network connectivity

Data is directly shared across boundaries of trust, without requiring a centralized intermediary or complex data transfer and reconciliation processes• Datastore can be directly shared by

multiple organizations• Every node in a blockchain

independently verifies and processes every transaction

Replicated data controlled by multiple organizations• No single point of failure• No single point of control (no

single SYSDBA) or potential for compromise


Permissioned/Consortium Permissioned/Private Public

Access to Network Members invited to enroll One entity controls all nodes

Open Access, Permissionless

Validators Pre-authorized validators in R/W or R/O mode

Pre-authorized validators in R/W or R/O mode

Anonymous fully decentralized validation

Blockchain Technologies Hyperledger, Corda Hyperledger, Corda Bitcoin, Ethereum

Consensus

Transactions throughput 100’s -1000’s/sec 100’s -1000’s/sec 7-15/sec

Types of BlockchainsValidator Node

Read Only Node


Three Major Blockchain Technology ComparisonsCharacteristic Ethereum Hyperledger Fabric R3 Corda

Description Generic blockchain platform Modular blockchain platform Specialized for banking

Governance Ethereum developer and banks via the EEA (Enterprise Ethereum Alliance)

Linux Foundation R3 Membership

Mode of Operation Permissionless (Public) or Permissioned (EEA)

Permissioned Permissioned

Consensus Mining PoW (Proof of Work) and others POS (Proof of Stake)Ledger Level

Multiple approaches (e.g., Kafka-based ordering service)

Specific understanding of consensus based on notary nodes

Privacy No Yes, confidentiality domains allow members to conduct private transactions over confidential channels

Mandatory, all transactions are visible only to participants

Smart Contract Languages

Solidity GO, Java Kotlin, Java

Currency Ether or Tokens via SC None built-in; Currency and tokens via smart contracts

None

Who is Using Fintechs, Banks, Enterprises Enterprises, Banks Banking only

Frothy ICOs (Initial Coin Offerings)

Yes No No

Oracle confidential


Supply Chain Contract Manufacturing

Common Challenges• Product

• Where is it, where was it produced?

• Content and Specifications

• Are there banned materials included?

• Does it meet my specifications and export compliance rules?

• Financials

• When is ownership transferred?

• Does the invoice match & should I pay it?

• Exceptions

• How to handle them?






Vision Operations


EDIFTP

Simulator

SCM Cloud


Supply Chain Contract Manufacturing

Blockchain establishes a trusted business network between the organizations

• Peer nodes representing each entity

• All transactions that need to be shared are reflected real-time in the DLT without offline reconciliations or centralized 3rd parties

• Tamper-proof records available in their local peer nodes to all authorized participants

• Smart contracts executed in the blockchain verify the information , take action or send back events to enterprise systems.






Vision Operations


Simulator

SCM Cloud

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Components of a Blockchain Platform

15

Validating Nodes / Peers

Ordering Service

Smart Contract/ Chaincode

Ledger (World State)

Applications

REST Proxy

Membership Service

Admin Console

REST Proxy

Users and ApplicationsUsers and

ApplicationsApplications(SDK based)


ApplicationsApplications(REST API)

Vendor Managed Platform

Peer Node

Smart Contract

Ordering Service

Distributed Ledger

Membership Service

Blockchain Network Console

Smart Contract

Peer Node

Gateway


Components of a Blockchain Cloud ServiceValidating Nodes /

Peers

Ordering Service

Smart Contract/ Chaincode

Ledger (World State)

Applications

REST Proxy

Membership Service

Admin Console

REST Proxy




Peer Node

Smart Contract

Ordering Service

Distributed Ledger

Membership Service


Smart Contract

Peer Node

Gateway


ApplicationsApplications(REST API)

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Business Applications

Procurement

Sales and Service

Supply Chain Manufacturing

Finance HR

REST Proxy




Peer Node

Smart Contract

Ordering Service

Distributed Ledger

Membership Service


Smart Contract

Peer Node

Gateway


• Birth and death certificates

• Business licenses

• Property ownership (land titles & deeds, cars, yacht, plane, etc.)

• Driver licenses

• University transcripts/degree certifications

• “KYC” for security cleared citizens

• Customs documentation, certifications

• Taxes & dues

• Quality control inspection reports

• Food genealogy and provenance tracing

• Pharmaceuticals production & importation

• Bids transparency and tracking

• Fulfillment tracking linked to bids

• Taxes across jurisdictions

• Benefits/welfare digital wallets

• Citizen records updates for multiple jurisdictions

18

Blockchain Conversations in Public Sector

Government Records Regulatory Certifications

Procurement

Citizen ServicesCustoms


• Intra-Bank Cross Border Payments/Remittances

• Bank-to-Customer Trade Transactions

Supplier / Vendor Finance

Invoice Factoring

• Component Lifecycle Tracking

• Farm-to-table food provenance

• Country of origin traceability

• Electronic compliance records

• Quality control records

• Roaming traffic across networks

• Inter-telco cost/revenue netting

• Electronic Health Record

• Service provider credential management

• Clinical trials

• Recruitment – background checks

19

Blockchain Conversations in Private Sector

Financial Services

Manufacturing and Retail

Telco

Healthcare

Cross Industry







Autonomous Business Processes

Order

InvoiceCustomer

25

Use case: Customer Invoice Factoring

Factoring Proposal


Autonomous Business Processes

Order

InvoiceCustomer

26

Use case: Customer Invoice Factoring

BlockchainEnabled BusinessServices

Factoring ProposalAutonomous Automated Processes

Artificial Intelligence

Machine Learning


IncreaseBUSINESS VELOCITY

• Rapid on-boarding of local and global partners to a trusted business network

• Real-time information visibility across partner ecosystem

• Accelerate transactions, eliminate reconciliations and optimize business decisions

• Enable new business models and revenue streams by reaching untapped markets

• Speed up existing business processes through blockchain integration accelerators

• Securely integrate on-prem ERP or SaaS applications with BlockchainServices.

Drive INNOVATION

• Eliminate intermediaries and related costs, delays, and risks

• Protect against single points of failure and insider attacks

• Reduce downtime risks with a resilient, enterprise-grade as-as-service offering

• Outsource to Oracle the burden and risk of keeping up with rapidly evolving technology

ReduceCOST & RISK

Business Value

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Blockchain for Modern Business Applications · Title: Oracle Blockchain Cloud Service Author: David...

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