A Closer Look At Blockchain Infrastructure And IaaS Companies

The best systems are only as powerful as the infrastructure upon which they rely. In the same way that power stations and wires are the infrastructures needed to offer electricity to citizens, servers and protocols are needed to run blockchain transactions.

Computer engineering is interesting because of virtual instances from a piece of physical hardware. Essentially, customers have the choice of running their own virtual instance of a server for increased flexibility.

Blockchain infrastructure providers offer mechanisms to build, deploy and scale in Web3. They are typically known as blockchain Infrastructure-As-A-Service (IaaS) providers or just Web3 infra providers for short. While distributed ledgers allow you to deploy your own node, this is a costly and time-consuming process that requires significant expertise.

Nodes And Clients

Blockchains are supported by nodes and clients. Nodes validate transactions, store full or partial records of the blockchain, and submit votes for governance. Clients dictate how these functions are actually performed. There are 3 major types of nodes:

• Full - Require a full copy of the blockchain. Technically challenging to maintain. Verifies all transactions.
• Light - Light nodes are low resource. Users can sync with the blockchain without needing to store the full version. Light nodes do not need to be run constantly but must connect to intermediary full nodes to request information.
• Archival - Used for storage purposes. It stores the full balance history of any account in the chain and stores the history of every state change in the network. An archival node might best be described as a full node with a massive amount of cached historical information.

These are broad terms. Another type of node is known as “” and is currently quite theoretical. Vitalik Buterin has been talking about this since 2017. The node type will depend on the consensus mechanism. In a proof-of-stake ecosystem, nodes can be divided into participation nodes, relay nodes, sentry nodes, read/write nodes, etc.

But to keep things as simple as possible, nodes are a form of computer/server used to store, send, and receive information. The more efficiently they do this, the better the network will run in terms of speed, cost, and security.

What Are Web3 Infrastructure Providers?

There is no reason for developers to set up their own full node. It’s time-consuming, resource-intensive, and technically challenging. And there is no real economic incentive to do this. The primary advantages are that you will be contributing to the overall health of the network. You will also have maximum control and sovereignty. But from a commercial standpoint, it makes little sense.

IaaS providers essentially maintain and configure the full nodes, update the network with security protocols, and can offer additional customization features. They do this at a much lower cost. It’s far more feasible, especially for projects looking to scale and onboard more people quickly.

Ankr, one of the top Web3 IaaS providers, allows unlimited RPC requests with its developers’ plan and runs its own bare-metal servers. They are the main infrastructure partners for Binance, Polygon, and Fantom.

Decentralized node providers like Ankr provide an essential function in Web3. Metamask and OpenSea users were recently restricted due to reliance on an Infura API; they were trapped due to reliance on Infura, which is owned by Consensus.

Distinguishing IaaS Providers

IaaS providers should be distinguished from blockchain-as-a-service (BaaS) providers. IaaS providers will primarily focus on the nodes and infrastructure - the hardware and maintenance. They may also provide development services like RPCs and blockchain query tools.

BaaS providers can offer a wide range of services, including integrations and onboarding. But the terms overlap and are used interchangeably by many.  It’s also important to distinguish blockchain IaaS (Ankr) from legacy IaaS (AWS). One is Web2 orientated, and the other is Web3 orientated.

IaaS Providers Need To Consider Subnets

IaaS providers will need to offer both flexibility and stability to developers. This is already happening with subnets, also known as sidechains. This allows several subchains to branch off from the main chain, allowing for test networks and enhanced scalability and functionality. Subnets can be deployed for specific purposes.

For instance, Avalanche (not an IaaS provider) offers 3 chains; C-Chain, X-Chain, and Y-Chain, and each of these chains is a subnet with specific functionality. Web3 projects like Ayoken Labs have chosen to launch their token on the Avalanche C-Chain.

The project is also focused on onboarding creatives to the Metaverse in a big way. Avalanche is faster and more versatile than Ethereum in many ways. But a dedicated infra provider is still required to take development further.

Subnets can even be launched by customers from a main chain. It allows a significant amount of room for creativity and testing. In the future, we are likely to see increased node decentralization, multichain expansion, and interoperability between blockchains. This will help to build the future of Web3.

IaaS providers that empower and grow with those who build with them will take center stage.