The MultiChain blockchain is similar to a legal network of Bitcoin that is made for financial institutions.
The open-source platform for blockchain, known as the MultiChain, is created to deploy and build private applications in blockchain that can function between or within organizations.
These multichain platforms give a simple command-line and API interface. These are great for any financial transaction. The MultiChain has been built with a comprehensive array of features, including simple configuration per-chain, data streams, native assets, and permissions management. With these high-end features, enterprise applications can get the needed assistance for confidentiality, scalability, compliance, and integration.
Since it is a lightweight private network, it can be easy to maintain and deploy it as it has flexible and developer-friendly tools. It enables the use of different languages in programming like JavaScript, Ruby, PHP, C#, and Python. Native tokens are referred to on the network as assets that stakeholders can create and transfer among themselves. The platform off-the-shelf is known as MultiChain. It mirrors some of the features of Bitcoin. That is because it extends the Bitcoin Core APIs and Bitcoin protocol. Because of that, it is compatible with a wide array of open-source code and tools built for Bitcoin that includes hardware devices for security, mobile wallets, software libraries, and online explorers. On the network, the nodes demand connectivity and not uniformity, so every participating system that works on installing the software connects for the formation of the MultiChain network among various organizations or in one organization as it shares a similar transactions database.
The Importance of MultiChain
Some programmers chose to create a database that is the same as Bitcoin last 2014. However, they wanted to make it more adaptable to an ecosystem that is regulated. The software company known as Coin Sciences initiated the first attempt of doing Bitcoin 2.0. They named the project Coin Spark.
When the Coin Spark project failed, Coin Sciences eventually opted to make MultiChain become a permission blockchain. The MultiChain’s creation aims to improve blockchain technology through solving the challenges of Bitcoin, like problems in bloating and scalability. MultiChain has solved the issues related to the cost of mining. It eliminates the associated risk with openness by managing user permissions integrated and giving the required control and privacy.
This private blockchain ensures the network’s scalability by controlling the data that gets shared for every block. It allows for the elimination of irrelevant data and increases the transaction speed. With it, organizations are offered the privacy that projects need because the selected participants can only see the activity of the blockchain.
Even if it may be a fork in the blockchain Bitcoin, it is more affordable to mine blocks through delegation and not proof of work. Because of that, it can be more friendly to the environment than Bitcoin’s mining mechanism that consumes so much energy. Multichain software can be compatible with supply chain and financial systems solutions since it has a straightforward approach for storing data and quick transaction speed.
Features of MultiChain
Stream: Since it is a database shared privately on the network, streams retrieve general data and archive and timestamp. The regular stream is capable of retrieving and storing the blockchain’s raw data. Streams have a collection of things, and every item has data, a timestamp, digital signature/s, and an essential option for retrieving data. It can be possible to create streams as either closed or open. Anyone who is permitted to send a transaction in the blockchain can have available streams writable. On the other hand, closed streams are restricted to a list of changeable addresses that are permitted.
Permissioned: The network admin provides permission to access the MultiChain network often by default from the developers. It has built-in tools that enable the developer to configure and make a network of their own that has some parameters such as the blockchain’s privacy, network’s access permission, the maximum size of the block, rewards in mining, consensus level, mining diversity, and more.
MultiChain allows the revoking and granting of privileges with the use of network transactions that contain unique metadata. The one who mines the first “genesis” block will automatically get all of the benefits that include the administrator rights that can manage the privileges of the other users. The first admin can assign mining roles to any of the network’s stakeholders. Then, they can have the ownership of assets transferred and share the stream or database with the network’s other nodes.
Connection Peer-to-Peer: In MultiChain, the hand-shaking process happens whenever the blockchain nodes connect. Every node has an identity that has itself represented with an address that has a list of permissions. Because of that, nodes can send messages to one another, and the P2P (peer-to-peer) connection would abort if they are not receiving satisfying messages.
Assets: The asset is a token on the MultiChain. It enables the tracking and creation of the native assets at the level of the blockchain network. It comes with built-in tokens in blockchain that have both the chain’s native currency that people can use for the transaction fees and the additional assets issued with it. Every node in the MultiChain can verify and track the number of assets that transactions have.
Mining: Network admins execute mining that uses the distributed consensus among the identified block validators. To avoid the monopoly of the minority in the process of mining, they have restricted mining to a set of identifiable entities. For every block, there is just one validator.
Unlike the process of mining Bitcoin, wherein nodes are needed in solving mathematical puzzles, it allows any permitted node to generate new blocks after it waits for a randomized timeout that is subject to the diversity parameter. This scheme is what MultiChain is implementing with the use of the parameter known as mining diversity. It is constrained because of 0 ≤ mining diversity ≤ 1.
At default, block rewards and transaction fees are zero, so miners would not require compensation when they provide this service beyond their standard stake in the smooth function of the blockchain. However, the network participants can pay the miners native currency in correspondence for the tokenized assets.
Scalability: Issues in scalability are solved by Multichain using the dual chain method in storing data. Every information that gets published to the stream may be off-chain or on-chain as you desire. Multichain is not the same as other blockchains wherein they expect every node to store and validate transactions as it doesn’t allow data to get replicated to each node. They lessen the blocks’ size by embedding large data hashes in transactions and not the data in itself. They only share the decryption key with the participants who need to see it for every piece of information. The Multichain is capable of powering a maximum of 2000 TPS (transactions per second).
What is the effect of this?
MultiChain Enterprise has advanced the blockchain technology for enterprise use with scalability and high transaction speed while supporting multiple blockchains that can connect and interact with each other. It can be surmised that, indeed, permission blockchains are helpful in the regulated financial industry, and companies like banks are beginning to harness this tool. It is quite costly to set up a private blockchain, especially if you are at the early stage. That is because you need to have every node configured first before any transaction. Regardless of that, MultiChain is considered one of the most recommended enterprise blockchain applications that ever existed. More than a hundred organizations are making use of the MultiChain application for their financial transactions.
