Off the Blocks | Vol 74, July 2, 2019
|Jul 2||Public post|| 8|
This newsletter is our weekly roundup of some of the significant blockchain news, that provides an overview of the rapidly changing blockchain landscape to help you map your blockchain strategy and be aware of regulatory announcements globally. Get your friends to Subscribe Here.
On Digital Identity
The ICO craze provided a fantastic learning curve for companies building blockchain solutions. It laid bare the infrastructural and operational issues that need to be in place for a decentralized ecosystem to be meaningful in the real world. One area of rapid progress has been in the realm of digital identity. During the peak of ICO activity, most companies evolved their own solutions to verify the identity of the token buyers. the state of the art often was a “white list” of participants, verified only by a unique email address, which was associated with an ERC20 wallet address. This was the extent of KYC (know your customers) checks performed. Companies like Identity Mind and OnFido made the most of the opportunity and quickly evolved solutions to verify basic identity elements for the registrants. Today, barely a year later, KYC and compliance with AML (anti money laundering) laws has become a standard for blockchain companies. The tech has evolved into sophisticated algorithms that flag unscrupulous elements around the world based on their digital footprint and associates it with their identity.
In the physical world, identity is a complex business.
Consumers categorize themselves on the basis of demographics, social roles and shared consumption patterns or preferences. The potential identities that people possess are both numerous and fluid, varying over an individual’s lifetime and across situations. In a work setting, for example, a person’s professional identity as an entrepreneur might be at the top of her mind. Later, at home, her identity as a parent may move to the forefront. And on the weekends, her identity as an outdoor enthusiast could take precedent. Identities can be thought of as hats that consumers put on and take off.
However, in the digital world, most people are defined by a psychographic profile created by their online browsing habits which ignores the complex reality of individual identity. Individual identity is set by corporate cookies, and that identity is not easily portable nor is it under the control of individuals. As consumers demand more sovereignty over their own data and assert control over their identities, this model begins to fray and completely breaks down with decentralized solutions that are rapidly taking hold based in blockchain technology.
In the exciting world of blockchains, identity is controlled by individuals. They decide when, where and with whom they share their credentials. Identities can now be configured in a 'self-sovereign' manner - enabling users to take charge of their own information and identities. Read more here.
“Self-sovereign” essentially enables individuals to securely store all of their information in their own digital vaults (or wallets). As the need to share this information arises, users can present this information for authentication purposes. This eliminates the need to store personally identifiable information with third parties and the corresponding risk of accidental leaks or hacks to centralized servers such as Equifax that compromised 143 M identities. Further, it also makes it almost impossible for any party to trade a user’s private information for monetary returns. In effect, business models based on blockchain technology are enabling the shift of identity power dynamics back to the actual owner of the individual’s information.
Anyone can become a credential issuer. Identity owners can hold credentials from multiple sources and present them to prove things about themselves. Credential verifiers determine which credentials they will trust. This is how identity works in the physical world. Sovrin brings it online.
- Dr. Phillip Windley, Sovrin Foundation
These developments are not lost on large corporations that thrive on arbitrage of personal information. Notably, it is a strategic direction that companies like Facebook wish to exploit as they position themselves for the next chapter of growth. The company’s ambitions were transparent in the Libra white paper where they unsurprisingly addressed this in an extremely brief manner devoting exactly 2 sentences to it.
An additional goal of the association is to develop and promote an open identity standard. We believe that decentralized and portable digital identity is a prerequisite to financial inclusion and competition.
Within the Libra ecosystem, Libra, the currency, might be able to provide for an open identity. However, as the system interacts with the rest of the physical world, it could allow users to leverage the open identity toolset to access services outside of the Libra ecosystem. As such, the applications will extend well beyond financial services to healthcare, educational credentials, insurance policies, travel and logistics etc, all of which require some form of identity verification. With a captive user base of 2B+, Facebook is in a prime position to develop an identity system. The white paper does not provide any details on the implementation roadmap. However Libra builds out the identity ecosystem, it is a frontrunner to create a digital identity standard for decades to come.
Whether it alleviates privacy concerns or whether people trust Facebook enough to use it remains to be seen.
Now some significant news form the world this week:
Telecom | A Global Blockchain Settlement Platform: The ITW Global Leaders’ Forum (GLF), which is a network of leaders from the world’s largest wholesale carriers, announced the launch of a blockchain-based platform. Known as the Communications Blockchain Network (CBN), this will revolutionize the ICT Service Provider industry’s commercial settlement infrastructure, representing an opportunity worth billions to the global industry. The CBN is expected to go live in the coming months and will be governed by a collaborative, industry-wide framework. Currently, 11 carriers have agreed to support the establishment of the platform, including A1 Telekom Austria, China Telecom Global, Colt Technology Services, Deutsche Telekom Global Carrier, IDT, Orange, PCCW Global, Tata Communications, Telefonica, Telstra and TNZI. [… Read More on Forbes]
Orbs is very different from IBM, ConsenSys and R3. We are not a private and permissioned blockchain, but rather public and permissionless. The fact that there is potential for public blockchain for enterprise use cases is a huge win for the entire market.
- Tal Kol, co-founder of Orbs.
Supply Chain | Walmart China Teams with VeChain on Blockchain Food Safety Platform: Walmart China has launched a blockchain-based platform aimed to address food safety concerns in the country. The new Walmart China Blockchain Traceability Platform already boasts 23 product lines tested and listed, VeChain said, with another 100 planned by the end of the year across 10 product categories including fresh meat, rice, mushrooms, cooking oil and more. By scanning the products with a smartphone, Walmart China customers can access detailed information, such as the source of the tracked products and geographic location, the route the product took to the supermarket, product inspection reports and more. VeChain went live almost exactly a year ago today, aiming to be the first to put “real business” applications on a public blockchain. It uses a form of permissioned consensus called proof-of-authority, an alternative to mechanisms like proof-of-work mining (as used by bitcoin) or proof-of-stake. [ … Read More on Coindesk]
South Korea | Kakao’s Klaytn Blockchain Has Gone Live With Support From Major Firms: The Klaytn blockchain from the fold of South Korean messaging app giant Kakao has just gone live. Kakao’s blockchain arm Ground X announced the mainnet launch Thursday, saying that Klaytn aimed to bring about mass adoption of blockchain services and to “substantiate the value and utility of blockchain technology.” The firm touts the network as having a speedy response time on the level of legacy web services, based on the feedback from the partners via a public testnet trial announced last October. Stability has been verified with different security companies using “high-intensity” testing, the firm said, while blind testing for developers and users helped Ground X improve the Klaytn user experience. [ … Read More on Coindesk]
The Council consists of 19 global top-tier companies that have successfully produced massive user-based popular services in various industry domains including IT, telecommunications, content, games, and finance. They are also key business units of some of Asia’s largest companies. … As key decision makers for key business and technical agenda, the Council members are responsible for operating the consensus node network. Further, they plan to develop Klaytn-based services or implement blockchain to existing services to drive the mass adoption of blockchain technology.
Tech | Blockchain Search: How Google Is Changing the Blockchain Game: Earlier this year, Google announced its deployment of a suite of open source tools for developers to better understand the blockchain as it relates to cryptocurrency. As part of the BigQuery Public Datasets program, Google had previously released public datasets for the transaction history of both Bitcoin and Ethereum. Google is essentially doing two things for the eight cryptocurrencies in its suite. First, it’s making the datasets public; in other words, it’s categorizing and publicizing the full transaction data for each of these blockchains. Second, it’s launching new search tools to make it easier to explore these data. The software itself is called Blockchain ETL (extract, transform, load), primarily created by Medvedev, an independent developer. This system scans for patterns in transaction flows, relying on machine learning to form conclusions about how the cryptocurrency address has been used in the past. It updates every 24 hours via a common codebase. [ … Read More on HackerNoon]
Interoperability | Metronome Now Lets Users Move Tokens Between Blockchains: MET token holders now have the option to choose their blockchain, a feature that was first announced a year ago at launch but only rolled out last week. The developers of the Metronome project announced activation of the cryptocurrency’s cross-blockchain capability following successful test transfers of MET tokens from the ethereum blockchain to the ethereum classic blockchain and back. Cross-chain hops allow holders to pick the ledger that suits their risk profiles and requirements for stability and governance. While that may sound like an atomic swap, Jeff Garzik, principal architect, CEO and co-founder of Metronome, explained how it would work:
Metronome is the opposite of a swap: There is no asset exchange, thus no exchange rate difference, thus no exchange rate risk or volatility risk. If you swap BTC/ETH, then you risk BTC price changing or ETH price changing. Volatility risk + exchange rate risk. With Metronome, the [MET] asset moves to a new blockchain, but keeps the same asset (and same asset price).
In June 2015 Google Photos’ facial recognition software labeled a picture of a black computer developer as a “gorilla.” The problem was so difficult to solve that as of January 2018 Google was simply not identifying anything as a gorilla, chimpanzee or monkey, according to a Wired report. The reasons algorithms behind AI become biased are myriad. But one of the most common explanations is that the data used to teach the algorithms are themselves biased—“garbage in, garbage out.” With data coming from a wide range of constantly changing sources, the “lessons” the algorithms learn can be difficult to reverse-engineer, making it nearly impossible to understand why an artificial intelligence became biased.
Blockchain can be really powerful in terms of how these algorithms are made and what’s influencing them, or if there is bias in AI to be able to understand how that came about.
- Caplan, Salesforce Blockchain
Proteum is a global blockchain advisory firm that works with public, private and start-up companies to help them transition into the world of blockchains and decentralized applications. We help companies strategically build their ecosystem and unique capabilities so that they can own and control their future. ProteumX, our accelerator program, invests in and accelerates the time to market for companies building blockchain solutions.