Yesterday I did an recording where the interviewer asked me a simple question – what is blockchain? This got me thinking – I had no go-to answer for this. People use this word to cover a wide range of networks and platforms, and some platforms such as R3’s Corda (Note: I work at R3) are categorised as “blockchain” platforms, when they don’t even bundle transactions into blocks!
The best description I could come up with was:
Blockchain is a word used to describe a bundle of technologies that allow digital assets to be created and passed from party to party with guarantees that the assets are authentic and haven’t been copied or counterfeited all without needing to trust a third party to open and maintain accounts for customers.
Another day, another catastrophic data breach. This time it’s medical records in Singapore, where I live. At this stage we’re almost immune to this kind of headline:
Cyberattack on Singapore health database steals details of 1.5 million, including Prime Minister (Reuters)
But this is quite bad. Eileen Yu noted in her piece for ZDNet (my emphasis):
Singapore has suffered its “most serious” data breach, compromising personal data of 1.5 million healthcare patients including that of its Prime Minister Lee Hsien Loong.
The affected users are patients of SingHealth, which is the country’s largest group of healthcare institutions comprising 42 clinical specialties, four public hospitals, five speciality centres, nine polyclinics, as well as three community hospitals.
Non-medical personal details of 1.5 million patients who visited SingHealth’s specialist outpatient clinics and polyclinics between May 1, 2015, and July 4, 2018, had been accessed and copied. The stolen data included patients’ name, national identification number, address, gender, race, and date of birth.
In addition, outpatient medical data of some 160,000 patients were compromised, though, the records were not modified or deleted, said the Ministry of Health and Ministry of Communications and Information (MCI), in a joint statement late-Friday.
Last December I was approached by a publisher, Mango, who asked me if I would write a book about blockchain technology. A little nervously, I agreed, and I’m excited to announce the result of six months of effort:
The Basics of Bitcoins and Blockchains is an essential guide for anyone who needs to learn about cryptocurrencies, ICOs, and business blockchains. Written in plain English, it provides a balanced and hype-free grounding in the essential concepts behind the revolutionary technology.
I wrote The Basics for an audience of business people, students, practitioners, and those who are simply interested in this technology. I tried to make it entertaining even for those who are already working in the cryptocurrency or blockchain industry. For example, did you know:
I’m absolutely thrilled to be able to write about the open sourcing of Project Ubin Phase II, a key project that our team has been working on for the past seven months with the Monetary Authority of Singapore (MAS), ten banks, and our partnerAccenture.
What is Project Ubin? It’s probably the most advanced starter kit out there for anyone wanting to explore blockchains for banking:
Over the past couple of years, R3 has worked closely with a number of central banks to explore if distributed ledgers could support their policy goals, and I have had the privilege to participate in a number of these projects.
What have we learnt? What is important? What do central banks care about? While I can’t speak directly for individual organisations, I have collated my own thoughts, and wanted to share these ahead of the Singapore FinTech Festival this year (13-17 Nov) when the results of Singapore’s “Project Ubin” experiments will be announced.
There has been a lot of hype around central banks, interbank payments, blockchains, and central bank digital currencies (CBDCs), but the narrative has become confusing and often misses the point. What’s going on? Actually two independent things are being actively explored:
Decentralisation of interbank payment systems
Wider access to digital central bank money (Central Bank Digital Currencies – CBDCs)
At conferences and events I often get asked a variation of “Is blockchain regulated?”. The short answer is no: technology is rarely regulated. It’s entities who are regulated (especially in finance).
Banks need their technology to conform to certain standards – resilience, security, and so on. The banks (not the technology!) get penalised if they can’t demonstrate high standards with the technology they choose to deploy. A common rulebook that is adapted for each jurisdiction is called Principles for Financial Market Infrastructures.
But blockchains and distributed ledgers share data, and often business is conducted across borders. And many countries have data protection laws specifying that certain types of data (eg personally identifying data) need to remain stored on computers within the borders of the country itself. How do we reconcile data sharing with data protection laws?
Well, instead of thinking about blockchains and distributed ledgers as a mechanism for sharing data (we know data sharing is a solved problem), think of them as “business to business glue” that can make business processes between entities much more efficient.
So, some data absolutely needs to be shared. In finance that may be some trade details: prices, amounts, delivery dates, etc. We do this today anyway, bilaterally and via intermediaries. But we only really want to share this kind of data with the other party (and not the entire network of participants!). Other data needs to be kept completely internal: customer details and instructions, valuations and profit margins, etc.
Can blockchains and distributed ledger platforms deal with these kinds of requirements? Absolutely – R3’s Corda was built specifically for this.
In my role as Director of Research at R3, I recently coauthored Blockchains and Laws: are they compatible? with Baker Mckenzie, the world’s leading cross border law firm. If you’re into that kind of thing, it’s well worth a read.
R3’s cutting edge research and thought leadership is also now available as a separate offering to consortium membership – here’s a selection of papers that R3 has produced.
2016 was the year of creating frameworks and filters to determine if a business problem was worthy of a blockchain-based solution. Often, the frameworks would declare inappropriate potential use cases as ripe for blockchaining, as the frameworks were often designed by blockchain vendors or consultants to let as much through as possible. However, many of the proofs of concepts built in 2016-17 have not become industrial solutions. Why?
Two main reasons are:
The technology didn’t meet the requirements of the use case
The use cases themselves were selected badly
This post discusses what went wrong with use case selection, and presents two new and better questions for use case selection.