The pros and cons of internal blockchains

I am often forwarded news articles of blockchain experiments run by banks or large companies, questioning “Why are they using a blockchain for this internal use-case?”.

Given that a blockchain is meant to replace a trusted external third party, or is meant to create trust between entities who don’t fully trust each other, an internal blockchain seems a contradiction in terms.

However, many of the publicly declared experiments, pilots and proof of concepts have focused on blockchains for internal use cases, ie a blockchain where there may be one or more nodes, but all under control of the same organisation, often within one department.

Although there has been much recent discussion about public (permissionless) vs private (permissioned) consortium blockchains, there has not been much debate on the virtues of internal blockchains.

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