VTT TECHNICAL RESEARCH CENTRE OF FINLAND LTD Blockchain & BOND - project Blockchains boosting Finnish Industry Blockchain Forum 21.03.2018 [email protected] Images: www.pixabay.com 2017-12-04 BOND Blockchain afternoon seminar Time Presenter Organization Topic 13:00 - 13:05 Arto Laikari VTT Welcome, opening of the seminar Senior Scientist 13:05 - 13:25 Markus Lehtonen Blockchain forum ry Blockchain forum ry Founder 13:25 - 13:45 Pekka Nikander Aalto SOFIE project Professor of practice Secure Open Federation for Internet Everywhere 13:45 - 14:05 Jukka Myllyaho Accenture Blockchain @Accenture Head of Capital Markets, Finland 14:05 - 14:25 Ari Mutanen Altoros Finland Blockchain @Altoros Finland CEO 14:25 - 14:45 Timo Koskinen IBM Finland Blockchain @IBM CTO 14:45 - 15:05 Elina Huttunen Finnish Standards Blockchain standardization Technical adviser Association SFS ~15:05 Coffee break 15:35 - 15:55 Janne Pulkkinen State Treasury of Finland D9, Public Administration Blockchain Technology group Chief Enterprise Architect 15:55 - 16:15 Timo Hotti OP Financial Group The age of decentralization in the world of silos Solution Architect 16:15 - 16:35 Kristiina Valtanen VTT Blockchain-enabled value creation Research Scientist 16:35 - 16:55 Arto Laikari VTT BOND project Senior Scientist Blockchains Boosting Finnish Industry 16:55 - 17:00 Arto Laikari VTT Conclusion 17:00 Senior Scientist Presentations: http://www.vtt.fi/sites/BOND/events/2017-12-04-bond-blockchain-afternoon-seminar 27/03/2018 BOND-project, [email protected] 2 Artificial Intelligence (AI), Blockchain, IoT, … Opportunity or threat? Science or Fiction? 27/03/2018 BOND-project, [email protected] 3 Images: www.pixabay.com Blockchain Blockchain Blockchain Blockchain... MTV3 - 8.11.2017: Civil marriage could be done in the Internet – using Blockchain technology (Finnish article) . https://www.mtv.fi/uutiset/kotimaa/artikkeli/siviilivihkimisen-voi-tulevaisuudessa-hoitaa-netissa/6650310#gs.ScLrTRQ . World of coins: Bitcoin, Ethereum, EstCoin, Cryptoruble, Auracoin, Solarcoin, Dentacoin, Whoppercoin, Adult coins… & ICOs (e.g. www.icoalert.com) . Sharing economy: Smart lock linked to an Ethereum Blockchain (Slock.it) . Etc. 27/03/2018 BOND-project, [email protected] 4 Images: www.pixabay.com Main topics of the presentation . BOND-project - Blockchains Boosting Finnish Industry . What is Blockchain? . Blockchains and standardization . European commission & Blockchain (examples) . Finnish Public administration’s Blockchain technology network . Blockchain Use Case area examples (BOND + in general) . Blockchain & IoT . BOND vision and main objective 27/03/2018 BOND-project, [email protected] 5 Images: www.pixabay.com BOND-project Blockchains Boosting Finnish Industry . Project duration 10/2016 – 04/2018 . Funding: TEKES (Industrial Internet – Business Revolution programme), companies and research partners . Joint project research partners: VTT, ETLA ja Aalto university . Diverse company involvement, 9 companies (see next slide) 27/03/2018 BOND-project, [email protected] 6 Images: www.pixabay.com BOND consortium . Research partners: . VTT . ETLA . Aalto . Companies: . 3Step IT Group Oy . Boogie Software Oy . Euroclear Oy . Fortum Oyj . Keskinäinen Työeläkevakuutusyhtiö Elo . Kouvola Innovation Oy . Nokia Solutions and Networks Oy . Telia Finland Oyj . Tietomitta Oy Advisory members: 27/03/2018 BOND-project, [email protected] 7 BOND project . Is not researching cryptocurrencies . Research partners together with the participating companies selecting use cases, which interest them. 27/03/2018 BOND-project, [email protected] 8 What is Blockchain? . Blockchain: Distributed database with continuously growing list of data records confirmed by participating nodes using cryptography. Blockchain use case ”feasibility” criteria: *) 1. A database shared by multiple parties 2. Enabling multiple concurrent writers 3. Maintaining consensus regarding the content of the database 4. Interacting modifications 5. The absence of trust 6. The undesirability of intermediation *) Mattila J. et. al., 2016 27/03/2018 BOND-project, [email protected] 9 Images: www.pixabay.com What is Blockchain? Source: Guardtime 2017 27/03/2018 BOND-project, [email protected] 10 Blockchain explained . Youtube video: ”Blockchain Demo” (Blockchain 101 – a visual demo) . Step by step explanation of: . Hash . Block . Blockchain . Distribution . Tokens . Coinbase . https://www.youtube.com/watch?v=_160oMzblY8 (17 min. 49 sec.) 27/03/2018 BOND-project, [email protected] 11 Blockchain consensus protocols . Proof of work (e.g. used in Bitcoin) . Proof of stake . Proof of activity . Proof of burn . Proof of capacity . Proof of elapsed time . Proof of importance . Proof of authority . Etc. 27/03/2018 BOND-project, [email protected] 12 What is Blockchain? . Is Blockchain = Bitcoin? . Bitcoin is implemented using blockchain technology 2008 2009 2015 2017 27/03/2018 BOND-project, [email protected] 13 Images: www.pixabay.com Blockchain – Gartner hype cycle 08/2016 27/03/2018 BOND-project, [email protected] 14 Blockchain – Gartner hype cycle 07/2017 Many Blockchain related items on the raising ”Innovation Trigger” slope! (Note! Not visible in this figure) 27/03/2018 15 Hype Cycle for Blockchain Technologies, 2017 On the Rise . Blockchain Wallet Platform . Smart Contract Oracle . Postquantum Blockchain . Smart Contracts . Distributed Storage in Blockchain . Zero Knowledge Proofs . Blockchain PaaS . Things as Customers . Blockchain for IAM (Identity and Access Management) . Decentralized Applications (Dapps) . Blockchain for Data Security . Metacoin Platforms . Quantum Computing . Consensus Mechanisms . Sidechains/Channels 27/03/2018 BOND-project, [email protected] 16 Source: www.gartner.com Cryptocurrencies boosting Blockchain . Bitcoin rally during 2017, especially Q4/2017 . Trade with [Bitcoin] futures started Dec 2017 . Other Cryptocurrencies, over 1300 ”cryptocurrencies” exist (11/2017) . ICO’s (Initial Coin Offerings) . Blockchain breaking to common knowlegde 27/03/2018 BOND-project, [email protected] 17 Bitcoin value – source coindesk 16.12.2017 / $19343 19.7.2010 / $0.06 4.2.2018 / $8647 27/03/2018 BOND-project, [email protected] 18 Things to consider when ”selecting” Blockchain . Open like Bitcoin vs. Private/Consortium blockchain . Permissioned vs. permissionless? . What implementation platform should be used? . Bitcoin based meta-data platforms . Blockchain platforms for financial applications - FinTech . Smart contract platforms . Consortium/Enterprise platforms . Sidechain/Anchored platforms . Multipurpose platforms & services . Privacy, security? 27/03/2018 BOND-project, [email protected] 19 Images: www.pixabay.com Blockchain platforms, connection to real world Financial Application Platforms Bitcoin based Smart Meta-data Contract Platforms Platforms Consortium / Sidechain / Enterprise Anchored ”Oracle” Platforms Multipurpose Platforms ”Real world” Platforms Image source: Pixabay 27/03/2018 BOND-project, [email protected] 20 Images: www.pixabay.com Smart contracts . Smart contracts are software programs that can enforce the contract in a way that the contract itself and its effects on the inputs are verifiable. Contracts are executed automatically (without third parties). Usage examples: . Voting . Auctions . Lottery . Escrow systems . Crowd funding . Micropayments . Etc. 27/03/2018 BOND-project, [email protected] 21 Blockchains and standardisation . Are Blockchains already standardised? . New field, work has started! . What should be standardised? . ISO/TC 307 - Blockchain and electronic distributed ledger technologies (First meeting: 04/2017 Sydney, Australia, Second 11/2017 Tokyo, Japan) . Study groups and working groups initiated – evolution ongoing . See more detailed next slide . SFS ry. (Finnish Standards Association) started a national blockchain follow-up group: “SFS/SR 229 Lohkoketjuteknologiat” to support ISO standardisation. -> BOND: VTT & Kouvola Innovation members. CEN/CENELEC Focus Group on Blockchain and Distributed Ledger Technologies about to start. Discussion ongoing also in W3C, IETF, ITU etc. 27/03/2018 BOND-project, [email protected] 22 ISO/TC 307 Blockchain and distributed ledger technologies . 30 participating members, 12 observing members . ISO/TC 307/SG 1 Reference architecture, taxonomy and ontology . ISO/TC 307/SG 2 Use cases . ISO/TC 307/SG 3 Security and privacy . ISO/TC 307/SG 4 Identity . ISO/TC 307/SG 5 Smart contracts . ISO/TC 307/SG 6 Governance of blockchain and distributed ledger technology systems . ISO/TC 307/SG 7 Interoperability of blockchain and distributed ledger technology systems . ISO/TC 307/WG 1 Foundations . ISO/TC 307/WG 2 Security, privacy and identity . ISO/TC 307/WG 3 Smart contracts 27/03/2018 BOND-project, [email protected] 23 ISO/TC 307 Blockchain and distributed ledger technologies . 16 ISO/IEC Liason committees to ISO/TC 307 . The committees can access the documents of ISO/TC 307 . 13 ISO/IEC Liaison Committees from ISO/TC 307 . ISO/TC 307 can access the documents of the committees . Organizations in liaison (Category A and B) . EC European Commission A . FIG International Federation of Surveyors A . ITU International Telecommunication Union A . SWIFT Society for Worldwide Interbank Financial Telecommunicatio A . UNECE United Nations Economic Commission for Europe A 27/03/2018 BOND-project, [email protected] 24 SFS & CEN/CENELEC . SFS SR229 Lohkoketjuteknologiat – Mirror committee to ISO TC307 . From BOND: VTT and Kouvola Innovation