Page - 107 - in Digital Entrepreneurship - Impact on Business and Society

example, through a digital consultation request with subsequent consultation—is approvedby theoperator or consultant and thus ultimately by a specific institution. At the same time, it can be defined within the organisational structure which employee can perform specific tasks based on the stored data. For example, a consultant needs information on content,while the payment for the service used is mainly of interest to the finance department. An institution using a private blockchain retains complete control of the system because all users and all operators of the consensus mechanism are known. In contrast toapublicblockchain, trust in thevalidators is thereforenecessary (Buterin 2015). Another significant difference is the reduced transparency: the code of the blockchain cannot usually be seen by the users (Wüst andGervais 2017). External parties—such as health insurance companies, the employer, or friends and acquaintances of the person seeking help—cannot access the systemeither.On the one hand, this serves to protect the blockchain and the data it contains, but it also prevents the blockchain from being developed further by amajority of users. The question in each individual case is always whether this is necessary. Just like the validation of transactions, the further development and updating of the blockchain falls to the limitedgroupofvalidators (Baumannet al. 2017).According toButerin (2015), an extension or improvement of the blockchain is thus much easier to achieve, since, for example, reconciliation processes can be streamlined. The revision of transactions is also possible in this environment through a rollback, since the groupof validators is clearly defined (Baumannet al. 2017). Thismaybe necessary if transactions have been incorrectly validated, e.g. if software errors or attacks have resulted in incorrect prices for the services provided. Private blockchains use different types of consensus mechanisms than public blockchains, which can validate at a much higher speed than, for example, the above-mentioned proof-based consensus mechanisms (Wüst and Gervais 2017). Particularly noteworthy here are the Byzantine fault tolerance (BFT) based con- sensus protocols, such as the pBFT (Wüst and Gervais 2017; Castro and Liskov 1999). This ismainly due to the fact that only a few, very powerful network nodes are required for validation: bothdata transfer rate and loading timeare significantly faster with these consensus mechanisms.5 The resilience of this blockchain type against hacker attacks, data loss andsystemfailures ismuchhigherwhencompared since they store data only on a selected set of computing systems (Baumann et al. 2017). Private blockchains are also very scalable and can be easily extended if necessary. Therefore, it is alsowell possible to test them initially on a small scale and if successful in expanding them (Carson et al. 2018). Legal framework con- ditions can also be clearly defined, as the blockchain can be unambiguously assigned to a company or another user group (Bogensperger and Hinterstocker 2018). These aspects speak in favour of using private blockchainswhen setting up 5For example, in thepublic-permissionlessBitcoinblockchain, thevalidation timeof a transaction can be up to two hours. In private-permissioned blockchains, it is usually only about 15 seconds (Baumann et al. 2017). Blockchain as an Approach for Secure Data… 111