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Author's profile photo Imoette Akpan

SAP & Blockchain

At this point, you have likely heard “Bitcoin” “Ethereum”, “Litecoin” and other interesting names for alternative currencies that have appeared in recent years. Currencies like Bitcoin stand on a technology known as the Blockchain. But what is the Blockchain, and why is it so important? This post will explain what the Blockchain is, and how SAP and others are utilizing it to help our customers and partners run their businesses better in the new economy.

What is Blockchain?

The blockchain is an open, decentralized information repository or ledger for transactions of money, property, goods, services and other things of value on the web. The idea is that every transaction on a Blockchain is public record that is verified by everyone in the community. As the network of users grows and becomes a global network, it becomes a decentralized source of trust. An example of this in practice is knitting. As Nathan Heller described it in The New Yorker’s “Estonia, The Digital Republic” article:

“A blockchain is like the digital version of a scarf knitted by your grandmother. She uses a ball of yarn, and the result is continuous. Each stitch depends on the one before it. It’s impossible to remove a part of the fabric, or to substitute a swatch, without leaving some trace: a few telling, or a change in the knit”

Each knot or node in our blockchain system is tied back to the one before it. If a swatch or transaction was missing, it would be noticed, which attempts to cover their tracks traceable.

There are multiple types of Blockchain, including:

  • Public Blockchain: Anyone can read a transaction, create/send a transaction, and take part in the driving the verifying transactions via the consensus process, which uses algorithm to reach an agreement among the different “knots”. This requires a large amount of computing power to maintain a distributed ledger, especially at a large scale. Another concern to note is that the “open” nature of a public blockchain means there is little to no privacy for transactions.


  • Private Blockchain: A organization that the blockchain members trust will manage the “write permission”. Access to view is limited and restricted, which provides more privacy for users and organizations. Transactions could be verified by a smaller number of users, which could increase the speed of the transactions.


  • Consortium Blockchain: This tends to fall in between public & private blockchains. This type of blockchain, the consensus is by preselected nodes or knots. Reading rights can be public or private and restricted to users.


A blockchain not only increases trust for users, but also decreases cost and provides a secure way for businesses to communicate and operate their core operations.


SAP & Blockchain

At SAP, our purpose is to help the world run better, improve people’s lives, and help our customers become a best-run business. Blockchain at SAP is important for the following reasons:

  • Simply Business Processes: This means to streamline complex multiparty processes with distributed ledger capabilities.
  • Deliver Business Impact: Connect to the blockchain ecosystem to address specific business needs.
  • Drive Digital Transformation: Accelerate business transformation with system of distributed ledger-based process innovations.


With blockchain, SAP has the potential to help customers solve problems in multiple industries, with solutions such as the SAP Leonardo Blockchain Service. The SAP Leonardo Blockchain is connected to the SAP Cloud Platform on top of SAP HANA and SAP Vora. This will integrate a blockchain system with the Internet of Things and Machine Learning on a single platform. What this means for users can add it to their existing systems to address issues such as fraud detection, improved inventory & supply system tracking and management, and improved storage of product items.

An example includes a case of blockchain in the public sector, when government officials in southern Italy needed a better way to document, validate and share files with key stakeholders. SAP hopes to reduce the manual validation for managers to a single click, and scale it to work with any governmental administrative process in Italy with SAP.

Final thoughts

Blockchain is a decentralized, but large network of nodes that allow people to view and create transactions and validate them, creating a trusted source of truth for businesses. SAP and our Blockchain Service can connect customers and partners to the Internet of Things and their data, creating automated processes for more efficiently running your business in the new economy.

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