Microsoft Goes Ethereum: $561 Bln US Company Releases Ethereum-Based Protocol ‘Coco’

Microsoft, the $561 bln US-based technology company, has released the Confidential Consortium (Coco) Framework, an Ethereum-based protocol which commercial companies and large-scale organizations will be able to utilize to process information on the Ethereum Blockchain with increased privacy.

In an official announcement, Mark Russinovich, the CTO at Microsoft Azure, the company’s cloud computing arm, said:

“Coco presents an alternative approach to ledger construction, giving enterprises the scalability, distributed governance and enhanced confidentiality they need without sacrificing the inherent security and immutability they expect.”

One of the most unique aspects of the Coco Framework is that it leverages local hardware-based environments such as Intel’s trusted execution environments (TEEs), to facilitate the settlement of information in an off-chain Ethereum Blockchain ecosystem.

By processing data in a separate ecosystem, it allows Microsoft to provide a more functional and flexible infrastructure for decentralized applications.

Processing information with the help of Blockchain
Previously, Cornell professor Emin Gun Sirer proposed a solution that leverages Intel’s TEE to settle Bitcoin transactions. In essence, Microsoft’s Coco Framework is similar, but utilizes smart contracts and the Ethereum protocol to focus on processing information.

More importantly, as Fred Ehrsam, the co-founder of Coinbase noted, Ethereum needs off-chain infrastructures like the Coco Framework if it aims to enable commercial organizations to process large amounts of information.

Tom Racette, the vice president at Mojix, stated that the Coco Frameworks expands the flexibility of the existing Ethereum protocol to host decentralized applications more efficiently.

"Being able to run our existing supply chain Dapp code much faster within Coco framework is a great performance improvement that will reduce friction when we talk about enterprise Blockchain readiness with our retail customers. Adding data confidentiality support without sacrificing this improvement is what will enable us to lead the digital transformation we are envisioning with Smart Supply Chains,” said Racette.

Off-chain scaling solutions
Cointelegraph previously reported that Ethereum needs off-chain scaling solutions and improvement by 100-fold in terms of scalability in order to efficiently power decentralized applications with one to 10 mln users.

At the time, Ehrsam noted:

“These are hard computer science and game theory problems. Most of them have never been solved before. Estimating completion can be hard and can be far off. Large apps can’t run solely on-chain and likely never will. They need off-chain scaling solutions. While it’s tricky to make accurate estimates when combining scaling improvements, it’s conceivable we could see a 100x improvement by the end of 2018, which would allow a 1–10m user app.”

Microsoft’s Coco Framework and some other smart contract-based platforms that are being developed by organizations within the Enterprise Ethereum Alliance will further enhance Ethereum’s scalability by leveraging off-chain solutions and as a result, allow decentralized applications to secure active userbases and process large amounts of data without running into conflict with security issues.