What the Enterprise Ethereum Alliance is about and how it can benefit

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The EEA will benefit the public chain by improving the protocol and it will boost the ecosystem. The key parts where the public chain will benefit from are modularity, data privacy mechanisms, becoming more scaleable and improving the EVM.

As less people buy Ether to invest and more people or companies will buy Ether to actually use and interact with the blockchain the price will rise.

It’s important to stay patient as the Ethereum protocol is not ready for mass adoption, developments for Proof of Stake (PoS) and sharding take time and these are needed to scale properly.

How will the Enterprise Ethereum Alliance benefit the public chain?

I figured this question comes back a lot and there’s a lot of guessing about the goal of the Enterprise Ethereum Alliance and how it benefits the public chain.

A common misunderstanding is that private chains will be using Ether. In the public chain Ether is used to execute operations on the blockchain, besides that miners are rewarded in return for securing the chain. this mechanism is put in place to create decentralized trust. Companies choosing to run a private chain often don’t need this mechanism because private chains are for example (generally) not a subject for a 51% attack on their own chain. Also they don’t need to pay miners to execute operations on the chain because they run the chain themselves and are not dependent on external miners. This means they won’t need the Ether that is used for the public chain, they can run it without a token or currency. Note, this does not mean the transactions and interactions are free, they are included in the cost of running and maintaining their blockchain (e.g. electricity and development).

It’s true they might have less strict requirements regarding to creating decentralized trust, however they have more precise requirements for other things that matter for them. For example other types of consensus, faster transactions, more transactions per second (tx/s) and security. Today Ethereum isn’t build modular. It means it comes in one package and you can’t change for example the consensus mechanism. With Metropolis this will change, it will be modular, meaning companies that want to change one element of the blockchain can do this (e.g. consensus mechanism).

More details on the roadmap can be found below with the source at the end. It’s fair to say this is ambitious considering this is a short term roadmap for 2017.

Enterprise Ethereum has five clear goals for 2017

1. Develop a sufficiently modular Ethereum implementation to separate and define clear interfaces between networking and storage layers – that is a prototype for pluggable consensus that minimizes the code changes required to switch consensus algorithms

(a) An emphasis on interoperability, including public Ethereum, enterprise and legacy systems, and alternative blockchain protocols (b) Stay close to the public Ethereum code and roadmap

2. Experiment with potential consensus algorithms, along with data privacy and permissioning frameworks

(a) Replace proof of work – address potential concerns about settlement finality for high value transactions

i. Validate digital signatures providing cryptographic proof and therefore enable settlement
ii. Very high level of reliability

(b) Interface to the canonical next block hash
(c) Canonical design patterns
(d) Obfuscate private data while retaining overall system consistency (e) Observe the required abstractions to enhance enterprise protocols

3. Develop a clear set of capabilities and performance characteristics that suits the needs of enterprises

(a) E.g. 100 tx per second across a 10 party network
(b) notably for higher volume or higher value use cases
(c) Higher complexity / workflows
(d) High availability / reliability
(e) Parallelisation and horizontal scaling

4. Develop a Version 1 specification for Enterprise Ethereum, based on the learnings from the above plus the roadmap and requirements gathered from members, i.e., Produce a reference implementation thereof

5. Leverage a robust governance process to ensure alignment and agreement on approaches

Not sure if the Enterprise Ethereum Alliance site is supposed to be public. But a lot of info can be found there.

We could say that the alliance will boost development of the protocol in key areas mentioned above, and by working actively with Ethereum, it will boost the ecosystem of the public chain.

 What does this mean for the price of Ether?

In the end the price of Ether will rise if the demand rises (or supply lowers e.g. locked up Ether), for this we need real use cases, meaning people or companies buying Ether, not as a speculative investment, but because they need to use and interact with the blockchain because it benefits them.

Patience is key here, the Ethereum protocol is not ready for mainstream adoption, it’s good to be tested during ICO’s what the effect is on the blockchain when many transactions are executed on a short time frame. But we need time to scale, PoS and sharding are the key developments that need to done to scale. Regardless of the price and current adoption, these developments will need their respective time.


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