The Positive Side-Effects of Blockchain

Blockchain is a relatively niche technology at the moment, and even thought there’s a lot of hype, its applicability is limited. I’ve been skeptical about its ability to solve all the world’s problems, as many claim, and would rather focus it on solving particular business issues related to trust. But I’ve been thinking about the positive side-effects and it might actually be one of the best things that have happened to software recently. I don’t like big claims and this sound like one, but bear with me. Maybe it won’t find its place in much of the business software out there. Maybe in many cases you don’t need a distributed solution because the business case does not lend itself to one. And certainly you won’t be trading virtual coins in unregulated exchanges. But because of the hype, now everyone knows the basic concepts and building blocks of blockchain. And they are cryptographic – they are hashes, digital signatures, timestamps, merkle trees, hash chains. Every technical and non-technical person in IT has by now at least read a little bit about blockchain to understand what it is. So as a side effect, most developers and managers are now trust-conscious, and by extension – security conscious. I know it may sound far-fetched, but before blockchain how many developers and managers knew what a digital signature is? Hashes were somewhat more prevalent mostly because of their (incorrect) use to store passwords, but the PKI was mostly arcane knowledge. And yes, we all know how TLS certificates work (although, do we?) and that a private key has to be created and used with...

Blockchain – What Is It Good For? [slides]

Last week I gave a 20 minute talk on the way I see blockchain applicability. I’ve always been skeptical of the blockchain hype, having voiced my concerns, my rants and other thoughts on the matter. I’ve followed actual blockchain projects that didn’t really need blockchain but managed to yield some very good results by digitizing processes, by eliminating human error, and occasionally, by guaranteeing the integrity of data. And recently I read an article that put these observations into perspective – that blockchain is just a tool for digital transformation (a buzzword broadly meaning “doing things on a computer and more efficiently”). That rarely the distributed consensus is needed, let alone public ledgers. But that doesn’t matter, as long as the technology has lead to some processes being digitized and transformed. So here are the slides from my talk: And people are usually surprised that I have a blockchain-related company and I’m so skeptical at the same time. But that’s actually logical – I know how the technology works, what problems it solves and how it can be applied in a broad set of domains. And that’s precisely why I don’t think it’s a revolution. It’s a wonderful piece of technological innovation that will no doubt solve some problems much better than they were solved before, but it won’t be the new internet and it won’t change everything. Doesn’t that skepticism hurt my credibility as a founder of a blockchain-related startup? Not at all – I don’t want to get a project just because of a buzzword – that’s not sustainable anyway. I want to get it because it...

Proving Digital Events (Without Blockchain)

Recently technical and non-technical people alike started to believe that the best (and only) way to prove that something has happened in an information system is to use a blockchain. But there are other ways to achieve that that are arguably better and cheaper. Of course, blockchain can be used to do that, and it will do it well, but it is far from the only solution to this problem. The way blockchain proves that some event has occurred by putting it into a tamper-evident data structure (a hash chain of the roots of merkle trees of transactions) and distributing that data structure across multiple independent actors so that “tamper-evident” becomes “tamper-proof” (sort-of). So if an event is stored on a blockchain, and the chain is intact (and others have confirmed it’s intact), this is a technical guarantee that it had indeed happened and was neither back-dated, nor modified. An important note here – I’m stressing on “digital” events, because no physical event can be truly guaranteed electronically. The fact that someone has to enter the physical event into a digital system makes this process error-prone and the question becomes “was the event correctly recorded” rather than “was it modified once it was recorded”. And yes, you can have “certified” / “approved” recording devices that automate transferring physical events to the digital realm, e.g. certified speed cameras, but the certification process is a separate topic. So we’ll stay purely in the digital realm (and ignore all provenance use cases). There are two aspects to proving digital events – technical and legal. Once you get in court, it’s unlikely to...