Blockchains and laws: are they compatible?

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).

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Blockchains and Laws: are they compatible? A paper I coauthored at R3 with Baker Mckenzie.

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.

Blockchains and cyberwar: Why the next wave of interbank settlement systems will be decentralised

Currently a number of central banks around the world are exploring two things:

  1. A decentralised interbank payment system
  2. A central bank digital currency

Though often conflated, these are slightly different concepts.  You can decentralise your interbank payment systems without allowing the public to have digital access to the central bank’s balance sheet, and vice versa.

This short post is about the first set of experiments: decentralising the interbank payment systems.

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A gentle introduction to self-sovereign identity

A gentle introduction to self-sovereign identity

In May 2017, the Indian Centre for Internet and Society think tank published a report detailing the ways in which India’s national identity database (Aadhaar) is leaking potentially compromising personal information. The information relates to over 130 million Indian nationals.  The leaks create a great opportunity for financial fraud, and cause irreversible harm to the privacy of the individuals concerned.

It is clear that the central identity repository model has deficiencies.  This post describes a new paradigm for managing our digital identities: self-sovereign identity.

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Three common misconceptions about smart contracts

There is a lot of misleading commentary about smart contracts, leading to confusion about what they are and what they can do. Here are three of the most common myths that I have noticed. This builds on a previous piece, a gentle introduction to smart contracts.

Myth: Smart contracts are self-executing bits of code

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What’s the difference between a distributed ledger and a blockchain?

A blockchain is a type of distributed ledger.  But new distributed ledgers are emerging. These are databases where control over the data’s evolution is shared between entities. Here’s a handy cheatsheet.

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A gentle introduction to The Hyperledger Project

A gentle introduction to The Hyperledger Project

I have noticed a great deal of confusion when people talk about “Hyperledger”.  I recently gave a talk about this at a meetup hosted in Paypal’s offices in Singapore.  This article summarises the talk.

Hyperledger is a project, not a technology, and you don’t build stuff on Hyperledger.

When people ask, “What is Hyperledger?”, the answer I give is usually “Do you mean the project called Hyperledger run by The Linux Foundation, or do you mean one of the ledger technologies incubated by that project which used to be confusingly called Hyperledger Fabric?”. The first is a group of people, the second other is a bunch of code.

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KPMG Report on Consensus: Interview with co-author George Samman

KPMG Report on Consensus: Interview with co-author George Samman

Q&A with George Samman, co-author of KPMG’s report: “Consensus: Immutable agreement for the Internet of value”

This interview is posted on both www.sammantics.com and www.bitsonblocks.net. Interviewer is Antony Lewis (AL) and interviewee is George Samman (GS).

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