There's a lot going on in the world of decentralised networking and not just the daily rollercoaster ride of the cryptocurrency markets. A decade after the mysterious Satoshi Nakamoto first unleashed Bitcoin on an unsuspecting world, the blockchain has grown and branched out and now a thousand flowers blossom, some of them rather peculiar blooms indeed.
Look around and you'll see that blockchains are apparently the answer to every problem. From replacing the global banking system to guaranteeing the provenance of diamonds to paying your dentist - there's a blockchain for that.
Overhyped they may be, but blockchains actually are a big deal and they will get bigger. Their potential for secure 'trustless' interchange is too great to ignore and once the silliness has died down inevitably some serious use cases will emerge.
Indeed that's already starting to happen, hence this blog. We'll be updating this page every few days to reflect the serious innovations bubbling up in this most interesting and volatile of spaces. (Also check out our rolling 5G coverage.)
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23/10/2018 Blockchain too immature for government use, finds Australia's DTA
The Australian government's Digital Transformation Agency has cast doubts over the validity of blockchains for governmental purposes.
The DTA, which was granted AUS$700,000 to investigate the technology, has concluded after initial research that in almost every case examined existing technologies are more suitable than blockchain.
The agency has been working with a number of government agencies to develop prototypes for the use of blockchain to deliver services, including with the Department of Human Services for welfare payments and cargo settlement.
Peter Alexander, CDO at the DTA said the technology is worth keeping an eye on but as yet is too immature.
"Our position today, and this is an early write-up, is that blockchain is an interesting technology that would be well worth being observed, but without standardisation and a lot more work, for every use of blockchain that you would consider today there is a better technology," Alexander told a Senate hearing on Tuesday, as reported by InnovationAus.com.
Alexander said that one of the defining features of blockchains, the potential for anonymity, is among the biggest stumbling blocks.
"Generally speaking when the government is engaging with someone, we want to have a trusted relationship with them. We want to know who they are and give them a personalised service," he said. "Blockchain is good for low-trust engagement, you don't know who you're dealing with but have a series of ledgers that can give some validation and support."
According to Alexander, blockchain is at the "top of the hype cycle", with demand driven by the industry.
"It would be fair to say that a lot of the big vendors are pushing blockchain very hard and internationally most of the hype around blockchain is coming from vendors and companies, not from governments and users and deliverers of services," he said.
23/10/2018 China mulls anonymity ban
China is another nation that finds blockchain's anonymity a problem. Earlier this year Chinese students encoded allegations of sexual harassment against a prominent professor on the Ethereum blockchain to evade the country's censors, all social media posts on the issue having been blocked. The same technique was used to spread news about low quality and counterfeit vaccines, another scandal the government sought to cover up.
But the Chinese government has drafted a new regulation that would require users to provide their real names and national ID card numbers when registering for a blockchain service, reports >The Verge. The policy would also demand that blockchain services remove 'illegal information' before it can be spread among users. And under the proposed legislation, service providers would also be required to retain backups of user data for six months and to hand it over to the police on request.
China has been bullish on blockchain for the last few months, with one commentator recently claiming it is worth ten times as much as the internet. The countries tech giants are pouring significant resources into its development citing smoother trade and anti-fraud possibilities. But without the possibility of anonymity, a permanent ledger could also be a powerful tool in the authoritarian regime's surveillance and control systems.
China also banned cryptocurrency trading earlier this year, although apparently this has been less than effective. The Ethereum Hotel recently opened in the country, accepting payment in cryptocurrencies.
19/10/2018 UK leads the way in blockchain deployments for supply chain, finds Capgemini
A survey by consultancy Capgemini of 450 organisations implementing blockchain in their supply chain has found that only three per cent have so far taken initial experiments into production at scale.
The respondents, drawn from the consumer products, retail and manufacturing sectors, said that establishing return on investment was the biggest challenge to ramping up their deployments, with compatibility with existing legacy infrastructure cited as another barrier.
Across the sample, three per cent were deploying blockchain solutions at scale, 10 per cent had pilot projects in place, while 87 per cent were still at early stages of experimentation with the technology.
The main drivers for the experiments were found to be cost saving (89 per cent), enhanced traceability (81 per cent) and enhanced transparency (79 per cent), although these varied widely from sector to sector.
While adoption and the technology itself are at an early stage, the Capgemini report identifies a number of current use cases, ranging from low complexity / high adoption scenarios such as the prevention of counterfeits and tracking asset maintenance, to more ambitious but complex uses including loyalty programs, contract labour procurement and regulatory compliance.
The UK (22 per cent) currently leads the way with production and pilot implementations of blockchain projects in the supply chain, while the USA (18 per cent) leads in terms of funding blockchain initiatives.
In the UK specifically, the consumer products vertical is the biggest adopter among those surveyed, followed by manufacturing and then retail. However, globally manufacturing is in the lead.
Sudhir Pai, CTO financial services at Capgemini commented: "There are some really exciting use cases in the marketplace that are showing the benefits of blockchain for improving the supply chain, but blockchain is not a silver bullet solution for an organisation's supply chain challenges."
Pai continued: "Blockchain's ROI has not yet been quantified, and business models and processes will need to be redesigned for its adoption. Effective partnerships are needed across the supply chain to build an ecosystem-based blockchain strategy, integrated with broader technology deployments, to ensure that it can realise its potential."
Capgemini has been working with blockchain technology since 2016 when it began developing solutions for the financial services industry. The report predicts that experimentation with blockchain will peak in 2020, before entering mainstream supply chain usage by 2025.
15/01/2018 Microsoft's strategy for decentralised identity
Microsoft might seem an unlikely champion of decentralised IDs. After all, decentralised identifiers (DIDs) represent an important decoupling of identity from generated data and applications that use it, and Microsoft, in many minds, is still associated with monopolistic powergrabs. But last week the company published a new decentralised identity portal and released a whitepaper explaining the benefits of individuals being able to create, own and manage their online identities independent of any third-party.
"Over the past 18 months, Microsoft has invested in incubating a set of ideas for using blockchain and other distributed ledger technologies to create new types of digital identities - identities that are designed from the ground up to enhance personal privacy, security, and control," the whitepaper says. "We aspire to make DIDs a first-class citizen of the Microsoft identity stack."
Actually, it should not come as a surprise that Redmond should be interested in this area. Microsoft was one of the early major tech company backers of blockchain technology after all, and decentralised identifiers, where a user controls his or her online identity or identities through cryptography, are a central feature of many of the emerging decentralised applications being built on blockchains and other decentralised platforms. And as we saw when Microsoft embraced Linux as a key part of its Azure cloud ecosystem, a 180-degree turnaround from its previous position, Redmond has proved adept of late at seeing which way the wind is blowing and moving with it. The whitepaper mentions integrating personal datastores controlled by DIDs into Azure.
IBM, the other big technology company leading the blockchain charge, has been active in this area for more than a year. Like Microsoft, IBM is a member of the Decentralized Identity Foundation (DIF). Critics point out, though, that while IBM has already been active in offering open standards for DIDs and related W3C projects, Microsoft has yet to lay any code on the table.
"I don't know what Microsoft has developed, I haven't seen any actual code," Wayne Vaughan, CEO of blockchain platform Tierion and DIF steering committee member, told >CoinDesk.
"Microsoft has been soliciting input from the community, but their software development has largely been done behind closed doors, and now they are releasing it publicly. With that being said, it's much better than nothing."
12/10/2018 Former Trump aide and Goldman Sachs chief Gary Cohn joins fintech startup Spring Labs as advisor
Gary Cohn, chief economic advisor to Donald Trump until April and before that president and COO of Goldman Sachs, has become an advisor to Spring Labs, a blockchain startup that aims to take on consumer credit companies like Experian and Equifax.
Unlike some of his investment banking brethren Cohn has never rejected the idea of cryptocurrencies, saying in May that a global cryptocurrency is coming.
"I'm not a big believer in Bitcoin, I am a believer in blockchain technology," Cohn told CNBC. "I do think we will have a global cryptocurrency at some point where the world understands it and it's not based on mining costs or costs of electricity or things like that."
Cohn told the >FT he believes blockchain's teething issues will be overcome and that blockchains have obvious potential in the financial arena, particularly for smart contracts and currency settlements.
"We all know all the inefficiencies of the existing currency world and blockchain clearly helps to eliminate them at some point in the future," he said.
Spring Labs, which has offices in Los Angeles and Chicago, boasts a high-powered board, which as well as Cohn includes Bobby Mehta, formerly CEO of credit company TransUnion, and Brian Brooks, chief legal officer at cryptocurrency exchange Coinbase.
Spring Labs' website says its technology will create "the foundation for a credit system that is more transparent and secure for consumers".
It continues: "The Spring network will allow users to view all attestations about their credit and identities for free, and enables functionality for open alerts and notifications."
Cohn said he would be assisting with getting the firm's technology adopted in the marketplace.
11/10/2018 Horizen's privacy platform
One of the biggest selling points of decentralised technology is privacy, believes Rob Viglione, co-founder of Horizen, a privacy-oriented blockchain platform.
Horizen was forked from ZCash, one of the leading privacy-focused cryptocurrencies. "We wanted to take it beyond currency," said Viglione.
Like most such projects, the Horizen platform does have a cryptocurrency (Zen) to power its internal market, but it was the key innovation of ZCash's founder crypto-pioneer Zooko Willcox that was the primary focus of attention, Viglione said. zk-SNARKs provide a practical cryptographic method of verifying that a computation such transaction between two parties is "correct" without having to know anything about the computation or the parties involved.
"Where ZCash is focused on currency we are actually building an application platform. That was the point of forking from ZCash - to grab the SNARK library so we could start with that base technology and cryptography. Now we are building things on top of it."
One of those things is what Viglione claims is "the most secure messaging protocols in the world". He admits it's "kind of clunky" at this stage, and because zk-SNARKs are computationally heavy it's not instant. "But if you're a reporter in Syria or China, you might want to use our app."
Viglione insists Horizen retains "very good relations with Zooko" despite having forked his code, and said the two companies collaborate on bug reporting and the like.
Asked about Horizen's potential "killer app" Viglione said the combination of a large number of nodes (there are currently 22,000 in the network) and zero-knowledge cryptography makes virtual private networking a strong candidate.
"If we can build the world's best VPN service, one that is fully anonymous and secure that could draw millions of potential users, not because they care about blockchain, but they want a service that is valuable. That's where we need to go were working very actively on those sorts of projects."
Another USP of decentralised systems is the possibilities for equality regarding decision making. The company is working on a treasury voting system that will enable Zen holders to make decisions on proposals for the network's development and allow transparency into the allocation of funds.
As for enterprise use cases, Viglione cites the simplicity of developing applications on sidechains that plug into the main network via an API. That way, they can make use of the network's privacy and security features without needing to have blockchain skills in-house.
One possible fly in the ointment is the current reliance on the Ethereum blockchain, although Viglione insists migration to another backbone would be possible. Ethereum has recently struggled to scale in the face of increased demand. "They hit the limits of natural growth in my opinion," he said, adding: "But I never discount them because they have a collection of brilliant people and I think they will overcome the issues as they come up."
02/10/2018 Zone and Icons launch ledger to authenticate and track sports memorabilia
The sports memorabilia market began with fans trading footballs and baseballs signed by their sporting heroes and expanded to an industry worth US$370bn globally, according to Forbes. These days no charity auction is complete without a signed shirt from a current or bygone star, but how can punters tell it the item is genuine when signatures written by robots are pretty much indistinguishable from the real thing particularly when many counterfeit goods are traded online?
Enter b-locked, a blockchain-based ledger designed to track the provenance of signed sports memorabilia. B-locked was developed jointly by Icons Shop Limited, which holds official merchandise licences from the FA, UEFA and FIFA World Cup and has exclusive contracts with players including Lionel Messi, Dele Alli and Eden Hazard, and Zone, a London-based customer experience agency which is part of professional service firm Cognizant.
To combat fraud, every Icons product comes with a certificate of authenticity and details of the player signing. This information can now be stored on b-locked so that future buyers can check its authenticity by typing a code or scanning a hologram via a web application.
The Zone team had originally chosen Ethereum as its blockchain platform of choice but, changed tack after the Cryptokitties debacle which showed up problems with its scalability.
"Ethereum transaction costs would have been too high for the project to be economical. So we used alpha code and ideas from Chainspace to build our prototype. We'll likely go ahead either with Chainspace or Cosmos, both of which make it easy to build the kind of logic and interactions we need," said Jon Davie, chief client officer at Zone.
Davie explained that the Zone team used an Agile methodology of short sprints to deliver the ledger. "We didn't seek to solve every challenge at the outset - rather to identify the key features and then learn by testing with customers and the Icons team," he said.
"Our next challenge is scaling the authentication process to cover every item in the Icons warehouse - it's an operational challenge as much as a technology challenge."
The system will be launched this month, with FC Barcelona star Lionel Messi signing 100 products which will be uploaded to the b-locked blockchain at an event in that city. Davie said the firm's short time to market was due in part to focusing on a specific use case.
"Unlike many blockchain ventures, we created this project to solve an existing problem for an existing business," he said, adding that it could be expanded to suit "any industry where authenticity is important - from art and antiques to whisky and wine."
28/09/2018 Nick Szabo, inventor of the smart contract, on its evolution
Nick Szabo, the computer scientist who came up with the idea of smart contracts in 1995 and coined the term, discussed the evolution of his invention during a keynote at blockchain live in London this week.
The basis of his talk was the fact that trust does not scale. Advanced societies have laws and institutions to mitigate the fact that we often have to deal with people and organisations that we know nothing about, including courts to enforce the fulfilment of agree contracts, but these are frequently ill-suited to the digital age.
The concept of smart contracts has moved on from the simple vending machine model which doles out a bar of chocolate provided you put the right money in, as defined in the program, to that embodied by distributed applications (dApps) on programmable blockchains such as Ethereum. But these are at an early stage, Szabo said.
"An Ethereum contract controls assets and typically gives some performance incentives, but it's not the full smart contract. The full smart contract involves user interfaces, it involves other features such as search and negotiation and performance monitoring, and it will also often happen off-blockchain." he said.
"For example, if you're doing logistical contracts and you want to track a package in time and space that's an off-blockchain oracle that is part of the smart contract that is fed into the Ethereum contract on chain."
Rather than the binary yes-no model, smart contracts will be negotiable, he said.
"Right now they are take-it-or-leave-it deals, but a true smart contract can be negotiated. So Alice makes an offer and Bob can accept or reject that offer, and if Bob has neither accepted or rejected the offer then Alice can revoke it. We [presumably referring to Szabo's company Global Financial Access] are working on smart contract negotiations of this nature."
They will also be customisable, and fully on-chain with parties able to make a counter offer in a "very trust minimised, environment" with the programming element eliminated via an intuitive user interface, he went on.
Szabo predicted a "win-win" scenario through the interfacing of smart contracts with what he calls "wet code": traditional contracts based on law. Each has strengths that can overcome the weaknesses of the other, he argued. Traditional contracts tend to be localised and rather subjective and unpredicatable and their enforcement is coersive, but they are based on expertise, experience and decades of case law, while smart contracts are globally scalable, predictable and enforceed through cryptography but immature and rigid.
"In many cases you want to use both together as complimentary. So now there's a contract between wet code traditional contracts and dry code smart contracts."
The low hanging fruit is financial contracts, he said "loans, bonds, derivatives". This sector he envisages a "spontaneous network of contracts formed from other smart contracts that is globally scalable."
26/09/2018 Real-world use cases emerging
A panel debate at the Connected World Summit in London this week dealt with the vexed question of blockchain hype. Yes, the panel agreed. Most blockchain projects are heavily oversold, driven on by crypto currency ICOs, but that's not to say it's all scams and vapourware. Genuine use cases, where a blockchain can do things that a distributed database can't, do exist, although most are still in the early stages.
Calvin Weise, founder of the Universal Patient Index and CEO of Kalibrate Blockchain, pointed to the health sector, in which surgeons have been occasionally known to chop off the wrong leg or doctors to deliver the wrong drug having been sent erroneous patient records. His company is working on a universal patient index stored on a blockchain that would reduce this problem considerably, he suggested.
Alfonso Delgado De Molina, analyst at Silver 8 Capital, brought up the smart bike locks marketed by Slock.IT where anyone with the right key on their smartphone can unlock the bike for a certain amount of time via a smart contract. This functionality also is being applied to cars by a startup in Berlin he said.
Alexandra Cheung, associate director of Cruxy & Co. spoke about systems to track the provenance of diamonds and also Floral Chain, which she says allows smaller growers and smaller shops to have a greater presence in the marketplace for cut flowers.
Using blockchain to help establish a presence was also mentioned by Darren Oliviero-Priestnall, CEO of Atlas City. He pointed to a project in China run by charity World Vision in which small farmers are encouraged to document themselves and their farms on a blockchain. Such evidence can help them obtain finance and establish their ownership rights. Elsewhere, undocumented refugees can start building an identity to help them in future dealings with the authorities.
The biggest current use case though is in the supply chain where goods can change hands a hundred times before reaching their destination, each transfer requiring additional paperwork. Assigning responsibility for any loss or damage is expensive and time consuming, delaying insurance payouts. This is the sort of scenario where an immutable, trustless record of events can really streamline processes - a significant caveat being that all players in the chain must be on board.
11/09/2018 Blockchain-based driving licence trial rolled out by Australian state
The Australian state of New South Wales is to extend its trial of blockchain-enhanced digital driving licences.
Changes to NSW state law in May allow drivers to use their digital licence for proof of identity and proof of age in place of a physical document for renewing fishing licences, buying alcohol, as proof of responsible gambling behaviour - and for police checks.
The licences already incorporate a number of methods to protect against ID fraud; these will soon be joined by a blockchain-based system called TrustGrid developed by Australian firm Secure Logic, an incumbent supplier to Australian government.
"The Digital Driver Licence has a range of security technologies protecting the integrity of the system and privacy of a customer's identity," a NSW spokesperson told iTNews.
The aim of the scheme is to use a blockchain-based system to secure and authenticate the information held on the licences, allowing users to validate themselves via a smartphone app without requiring further checks. The app also allows users to renew their licence or amend their details without recourse to the authorities.
The blockchain trial started last year in the town of Dubbo. 1,400 volunteers signed up for a three-month trial, using their digital licence as proof of identity and age in pubs and clubs. It will soon be expanded to 140,000 users in Sydney before an expected statewide rollout by the end of 2019.
Secure Logic CEO Santosh Devaraj is (understandably) keen to push the wider implications of the trial for government services.
"The era of standing in line to file government paperwork is coming to an end, as is our reliance on physical identification cards to establish your identity or proof of age with law enforcement or at licensed venues. These are mistake prone, time-consuming, expensive, and impractical ways to offer services," he said.
Next page: Soluna plans clean energy option for crypto-miners; UEFA's blockchain powered ticketing app; The security risks of smart contracts; Has the blockchain bubble burst?
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