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Baseline Protocol: Paving the Way for Enterprise Blockchain

We know that Ethereum is a public, permissionless blockchain network that is open to everyone. What big enterprises need, however, is a private, permissioned mechanism that allows them to keep their data safe and secure. That is where Baseline Protocol comes into the picture.

The Baseline Protocol has been developed as “Ethereum for Enterprises” and uses the Mainnet as the common frame of reference for these enterprises. As each of these organizations has its own chain of records, using the Baseline Protocol lets them carry out their business processes off-chain. This ensures that they maintain a high level of security and confidentiality of their data.

About Baseline Protocol

Announced on March 4, 2020, and launched on March 10, 2020, the Baseline Protocol utilizes complex cryptography and messages to provide easy-to-implement solutions for enterprises.  The Baseline Protocol is an open-source initiative of OASIS, a non-profit body; it came into being out of the collaborative efforts of three organizations, namely, Microsoft, Ernst & Young, and ConsenSys.

These organizations, along with 14 more, strived to develop a private blockchain business model at a low cost, without having to compromise on data security. The Baseline Protocol came into the picture when these enterprises initiated a supply-chain project called “Radish34” that enabled real-time volume discount calculation using Ethereum.

This protocol helps these enterprises utilizing a common frame of reference and thus avoiding data synchronization issues. Using this common frame of reference, the data between the two systems follow consistency and continuity.

The Baseline Protocol Implementation (BPI) involves the use of a Master Services Agreement between two parties: it details the scope of the legal agreement between the two participants so that state synchronization between the two can be reached and the parties (buyer and seller) need not worry about the inconsistencies arising out of any inaccuracies in the purchase order. This also avoids the manual verification of the order on both sides.

Mainnet for Baseline Protocol

The Mainnet that Baseline uses for business implementation is called “Baseledger”, a public, permissioned, and council-governed mainnet of choice for Baseline Protocol. It helps enterprises achieve state synchronization, and use plugins for their workflow exit and tokenization processes. The whitepaper for Baseledger has been authored by the combined efforts of two organizations, Unibright and Provide.

The whitepaper mentions Baseledger as an “Architecture of Architectures” meaning that the Baseledger network will take care of the leaf node consensus mechanism that allows plug-in other protocols for exiting and tokenization (acting as Layer 1), and facilitates workflows and zero-knowledge proofs (acting as Layer 2).

What does Baselining do?

Baselining assumes a no-coding approach and automatic smart contract generation to integrate enterprises into an off-chain system. Such an approach not only raises the levels of organizational performance while providing permissioned-privacy. If compared to the traditional database systems that the organizations have been hitherto employing, the baselining helps in minimizing the costs related to lost inventory, value leakage, and capital expenses.

The Baseline Protocol provides these companies with Ethereum Mainnet to be used as a common frame of reference, which significantly cuts cost on one hand and ensures data isolation on the other. The Mainnet acts as a middleware that is always-on, unrestricted, and lets anyone participate.

In baselining, several locally-private networks interact with off-chain systems, (called systems of record), and use the Baseledger as a common frame of reference. So, whenever a process within an enterprise needs to be updated in its private network, the Ethereum Mainnet is used as a middleware to synchronize the states, thus enabling the off-chain system integration to the blockchain. Baselining does not require to be built from scratch the systems for every new client that intends to use it.

How does Baseline Protocol help Enterprises?

  1. This protocol allows enterprises to carry out private transactions on the public blockchain. One of the fundamental advantages of baselining is the ability to perform complex processes via Mainnet without the need of leaving any confidential data on-chain. With this, companies can run end-to-end processes without spending sleepless nights over the issues of privacy and security.

  2. The always-on Baseline Protocol helps global enterprises maintain synchronization among their ERP (Enterprise Resource Planning), CRM (Customer Relationship Management), and Supply-Chain Management systems while maintaining privacy, transparency, and operational integrity without the need for any modification to their present legacy systems. Baseline uses cryptography and other advanced technologies to provide confidential end-to-end processes. This makes the benefits of baselining substantially higher than the traditional data management systems which suffer from the lack of coordination, high-cost maintenance, and susceptibility to attacks.

  3. The Baseline Protocol benefits organizations by allowing them to leverage both the public as well as private blockchain systems, thus gaining benefits of both the permissionless as well as permissioned networks. The Mainnet for baselining lets these companies exchange data with their counterparts without risking confidentiality.

A Use Case

The original efforts of Microsoft, ConsenSys, E&Y, and other organizations have paved the way for companies across different business domains leverage the baselining for creating tamper-resistant and economical integration fabric. In 2020, the Enterprise Blockchain Computing (EBC) firm, Dapps Inc. started using baselining for B2B workflow synchronization for the leading CRM company, Salesforce.

With this, the customers of Salesforce can now leverage sales processes between Salesforce as well as non-Salesforce customers without worrying about high-cost Application Programming Interface (API) integrations and long time frames. According to Dom Steil, the co-founder and CTO of Dapps Inc.,

 “The Baseline Protocol is a huge advancement for enterprise adoption of secure, private, and collaborative workflows that leverage the public Ethereum Mainnet.”

(Medium.com)

Of late, more and more enterprises are joining this open-source initiative for their businesses. The ecosystem adoption was further strengthened by a $100,000 funding in March this year that the protocol received from Ethereum Foundation for carrying out its research and development activities. By 2022, the global baselining adoption and multiparty system integration are expected to rise significantly.

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