Dragonchain ICO — Disney’s hybrid public / private blockchain platform

by Ben LongstaffOctober 6th, 2017

Too Long; Didn't Read

So before diving into Dragonchain I want to make a few key points.

Companies Mentioned

Coins Mentioned

featured image - Dragonchain ICO — Disney’s hybrid public / private blockchain platform

Using propriety data and business logic with blockchain

So before diving into Dragonchain I want to make a few key points.

A public blockchain needs the history of every transaction to be able to prove that you own an asset.
A public blockchain does not need to explain why you’re making the transaction.
Proprietary data and business logic should only be on a private blockchain.
A communication bridge enables a private blockchain to transfer public blockchain assets.

Cool, so with that said, let’s look at Dragonchain.

So what — why is Dragonchain interesting?

Smart contracts have the potential for operational efficiencies.

Dragonchain makes it easy for developers to use smart contracts with familiar technologies.

Dragonchain has five levels of nodes.

It took me a few read throughs to get it. I promise it’s not as complex as it sounds at first.

Lets say that Pet Co has determined that they should buy more dog treats from one of their vendors Bones R Us.

Transaction Approval — L1

Is where the proprietary logic and data determine that Pet Co needs to buy dog toys from Bones R Us.

Transaction Validation — L2

Validates that the transaction is valid for the L1 node based on the organization rules, e.g.

Supply Chain team isn’t executing a contract to hire an engineer.
Supply Chain team is approving a purchase order from an approved vendor

Transaction Verification — L3

Checks that a diverse range of L2 nodes across the network validated the transaction. E.g. three signatures are required for a purchase order

requiring someone from Finance, Legal and Logistics to sign off
preventing three Engineers from completing the sign off

Verification Observation — L4

Is an independent witnesses to the L3 node verifying the diversity requirements.

Transaction Execution — L5

Is a bridge to a public blockchain to transferred ownership of resources.

It can be even simpler if you trust all the actors in your private blockchain, then you only need L1 and L5.

Who cares?

This framework has application in healthcare, government, logistics and energy.

Smart contracts may need the use of proprietary business logic and private data. This makes them unsuitable for a public blockchain. Enter the private blockchain.

So how does this work?

Surely all the data needs to be public if you want to move assets around on a public blockchain right?

The answer is no.

A public blockchain just needs to be able to prove that you own an asset, it doesn’t need to be able to explain why you changed the ownership.

Yes, this could be done with a centralized system.

But the problem is who designs and controls the centralized system? In our example is it Pet Co, Bones R Us, the delivery company? Let’s say it’s Bones R Us that has this awesome system, with an app for solving supply chain management problems. Does that mean that the delivery company has to have an app for every customer?

This creates a problems if Pet Co has a unique business process that they need incorporated into the app. Pet Co is a massive customer for Bones R Us. Should Bones R Us create a specific app for Pet Co, or make the other customers use Pet Co’s process, or ….?

A private blockchain solves these issues. By having a common ledger, each company can build its own system customized to its processes.

Smart contracts also simplify auditing and allow for codifying business processes.