Microsoft Azure announced on Tuesday in a blog post the launch of a licensed cloud computing platform based on Ethereum (ETH) network but having the Proof of Work protocol replaced with the Proof of Authority.
Proof of Work Vs. Proof of Authority
Cody Born, a software engineer at Azure, Microsoft’s cloud computing platform, explains in the release note that the Proof of Work (PoW) protocol, used by Bitcoin (BTC) and Ethereum (ETH) blockchains, is based on computing costs for the self-regulation of those networks and to allow open participation.
Proof of Authority, on the other hand, does not require such costs and is more suitable for private blockchain networks.
The PoW works very well in open, anonymous networks, where competition for cryptocurrencies promotes network security. However, in private networks the underlying Ethereum (ETH) technology is worthless. An alternative protocol, Proof of Authority, is more suitable for permissible networks where all consensus participants are known. If there is no need to mine cryptos, Proof of Authority is more efficient, while maintaining fault tolerance.
Cody Born, Software Engineer at Microsoft Azure
Also noteworthy is that the Proof of Work is a consensus mechanism in which the miners compete in the resolution of a cryptographic task and when a miner finds the answer he or she diffuses it to all the participating nodes. For this, the miners obtain a certain amount of the respective crypto as a reward.
The Proof of Authority, on the other hand, is based on a set of Trusted Nodes, known as “authorities,” which are given the ability to secure the blockchain through transaction verification and to create new blocks. The validation of the transactions in the new blocks is done similarly as in the cases of Proof of Work, but without mining.
Microsoft Azure launched a platform based on Ethereum (ETH) blockchain that runs with Proof of Authority protocol
Microsoft, which focuses its decentralized solutions proposal on private blockchains, will use a development platform for Ethereum (ETH), Parity, which allows smart contracts to be programmed in widely used languages such as C, C++, and Rust.
Although there are projects within Microsoft using the language created for Ethereum (ETH), Solidity, Cody Born, Software Engineer at Microsoft Azure, says that corporate clients find this language very difficult to handle.
Microsoft Azure has previously served to develop innovative applications with blockchain for different companies. One of them was Renault, which used it to create a vehicle maintenance application.
On the other hand, several financial institutions have also used Microsoft Azure to improve their operations processes.