BlockApps Strato
BlockApps STRATO is part of Microsoft Azure 'Blockchain-as-a-Service'BlockApps

During a conversation with the team behind BlockApps, which recently signed a deal to offer an enterprise blockchain toolkit for Microsoft Azure, the subject of Oracle came up.

BlockApps chief executive Victor Wong used the analogy of Oracle as a database provider upon which you build stuff, to explain that BlockApps is providing an easy set of tools for businesses to start building on.

The BlockApps team – Wong, chief technology officer Dr James Hormuzdiar, chief data scientist Kieren James-Lubin, Haskell and API developer Dr Ryan Reich, blockchain geometer Kristoffer Josefsson, and UX architect John Crain – is part of the powerful and varied ConsenSys Ethereum app development studio.

BlockApps' flagship STRATO comprises a blockchain ledger which can run smart contracts customisable for permissioned environments where privacy and scalability are important. The toolkit is available as part of Microsoft's blockchain-as-a-service for enterprise customers on the Azure cloud service.

Consult Oracle

In light of Microsoft's foray into the blockchain space, and regarding the Oracle analogy, James-Lubin said: "I've not heard much from them [Oracle]. They are the database company; Oracle still is number one. I'm very curious actually as to what they will do. We're a database company too. Maybe we should try and see if they will respond to an email."

Some time ago, IBTimes UK reached out to Oracle for its view on distributed ledger systems, and eventually got a "no comment". Bitcoin hardliners have said Oracle getting into blockchains was like an oil company getting into electric cars.

James-Lubin said Oracle had a lot of expertise, and pointed out that people would not have expected Microsoft to be getting into Ubuntu. "They [Oracle] are very good at adding features to their existing databases," he said. "I mean, they have got enterprise customers so they listen to them I imagine. For many years now they have owned MySQL too."

Hormuzdiar added: "We don't know, but it's a great idea."

"Yeah, we are open to a call anytime," Wong joked. "The world is changing and I think you have to provide solutions of all kinds. There is the vision where everything just takes over from the old. But I think really in the interim blockchain systems have to clearly interoperate with existing systems, whether that's Oracle databases or Microsoft Azure or any existing infrastructure."

Ask Haskell

BlockApps STRATO is built in Haskell, the functional programming language which has a proven track record in finance, embedded into the trading operations of big banks for instance. In some respects BlockApps has come full circle, because Microsoft cradled Haskell for two decades and incubated most of the compiler work.

Hormuzdiar said: "Building blockchains was a very good use case to show off the benefits of Haskell. It's functional so the specification is the executable, and statically verifiable, so if it compiles, it's correct. As an added bonus, it scales very well, and has already been proven in mission critical financial applications.

"The sandbox Ethereum Blockchain as a Service toolkit is just an easy starting point to begin working with blockchain applications and smart contracts. Once you have built an application, STRATO seamlessly scales from test multi-node networks to full production deployments.

"The key idea is that our architecture allows the separation of blockchain applications into two layers: the application layer and the blockchain layer. Once you have written an application on our blockchain sandbox, it's portable, and it can easily be moved to other STRATO blockchain networks regardless of size. Basically, it's write once, deploy on any blockchain solution."

BlockApps began when Wong, Hormuzdiar and James-Lubin were looking to build apps on Ethereum. In April 2015, the team joined ConsenSys – the Ethereum apps design studio headquartered in Brooklyn, New York – but with developers based all over the planet.

Wong said: "We were figuring out how to build stuff on Ethereum and we just realised, someone has got to step in and make this technology consumable for what I would call ordinary developers. The thing about this technology is that once you get your hands on it and you start playing with it, it really opens your mind to what the possibilities are. So we wanted to provide that and for the last couple of months we have been doing hackathons and doing these small scale things."

Wong eschewed a blockchain maximalist state where one blockchain would rule them all and take over everything. In the enterprise arena, he expected the initial format would be enterprises implementing their own blockchains primarily as systems to enable efficiencies among their different branches or different departments. "As this process continues, you are going to see those blockchains communicating with each other, and they might communicate with each other directly or through a public blockchain like Ethereum," he said.

Back office burden and cost of compliance

Wong said the real value of this technology was primarily back office automation and the potential shifting of regulation away from an army of expensive compliance officers.

"Right now you have so much wasted effort on compliance – people just looking at two pieces of paper making sure they notch up," he said. "With an Ethereum-type blockchain you can embed those rules into the system. You don't have to add all these extra layers and all the auditing tracking. It's all baked right into that.

James-Lubin added: "We were thinking of adding to our demo something like, if you make a payment over $3,000 you get an auto email or something – that's usually like the report limit where they have to take a closer look. You could auto-lock things after that on Ethereum. You could bake that rule in.

Wong agreed: "You can change consensus rules based around those problems and do it in an automated fashion."

Between deep delve discussions into technology at the recent Ethereum developers conference, DevCon1, delegates asked who exactly will be the "average user" of things like smart contracts.

Average smart contract user

Wong said businesses of all sizes would be interested in changing a process that took days into one that could be done in minutes. "The first implementation of these things will probably be invisible to consumers but they will benefit from the phenomenal cost savings to businesses," he said.

Looking to specifics, James-Lubin gave the example of freelancer workers who might already use websites that auto-generated contractual agreements that could be signed and passed on to lawyers.

"A Solidity contract could actually enforce the agreement," he said. "You need maybe a third party to decide, was the work good enough, and third party escrow. When you are interfacing with the outside world you need something called an oracle which basically sends data into the contract and says something happens; the price of some assets changes, or the thing got delivered."

Wong added: "We have to build trust within systems that smart contracts are way more efficient. We know they are, from a technology stand point, but it will take time. All of this stuff is being made as we go along. It's like building a rocket ship as it's taking off."