I wonder what are the best use cases for an enterprise blockchain? EDIT: Great suggestions. How about some non-banking applications?
Let's say you're a traditional enterprise and you have a ton of geographically dispersed operations. Retail has shops open in malls across the country, logistics has warehouses across the country, and so on. Each one of these places has a local ledger - how much product is on the shelves, what came in, what went out the door. Many times, the ledgers are related - what leaves a warehouse should arrive at retail, and not drop off the face of the Earth.
Traditionally, you had a centralized database to manage all of this, from which reports could be drawn and sent to management. The problem with having a centralized database, however, is that it's a single point of failure. The database can suffer a loss of availability, etc.
If you replace it with a blockchain, then you can get rid of the database and allow all of your geographically dispersed operations to manage the ledger in a peer-to-peer manner, without the security problems that used to dismiss p2p solutions for enterprise, because the blockchain ensures the security of the ledger. Blockchain contracts can allow, say, a retail outpost to contract with a warehouse outpost to receive a shipment, even without connectivity to central management, and then central management can track the activity after-the-fact when it updates.
The real question that enterprise blockchains have to answer is, "is it really worth it to dump a system that works most of the time for a benefit I rarely if ever need that'll cost the enterprise a small fortune to develop, or are we picking blockchains because they're fad of the month and people love resume-driven-development?"
I agree with you that the branding is tricky, in part because the dominant term "blockchain" is describing a specific data structure. The key point we wanted to convey with Coco is that we are trying to enable secure, performant, multi-party computation. We think there will be many models for this over time as TEEs come into wider use. "Blockchain" is just one of them.
The Coco team shares Richard's view that the distinguishing factor is where the trust boundary exists within the system. In the case of Coco, we assume a lack of trust among consortium participants, but we leverage the attestation and anti-tampering features of Trusted Execution Environments (TEEs) to establish trust between the enclaves: assuming that the TEEs themelves are trustworthy, the TEEs can provide cryptographic proof of the software and configuration running on each enclave. In other words, I don't trust you, but my enclave has decided it can trust your enclave based on mutual attestation exchange and mutual authentication. In other words, we've transitioned from a byzantine failure mode (adversary can replace the expected remote code with arbitrary code at will) to a crash failure mode (adversary can shut the remote enclave down at will, but not alter what runs on it).
Once there is trust between enclaves, Proof of Work seemed inefficient as a consensus mechanism, although it's certainly one choice that is available and that can be used with Coco (in this case Coco would provide governance and confidentiality, but scalability and latency would be limited by PoW). Instead we can use any one of many distributed systems techniques such as Paxos or Raft to achieve consensus.
If we can lose this barrier to establish trust from a human one to a code audit that would be and outstanding achievement for our civilization.
So say you've got central logging setup at your organization. You're smart and are using rsyslog with SSL/TLS and your own CA. For the most part you can reasonably claim that your log messages are secure from the server that emitted them to the destination in your central logging system but can you guarantee they're not modified after that? No. You can't.
From this perspective using a blockchain for logging security-critical events would be extremely useful. It would be impossible for an attacker to modify the logs after-the-fact so that you could no longer determine which account they used to login.
You wouldn't want to use it for general logging because of the overhead but for things like login events, reboots, etc it would be fantastic.
- Your company handles dangerous or highly regulated materials (prescription drugs, hazardous materials, etc.) and you are required to have controls in place to monitor your supply chain. - You deal with lots of vendors of questionable reputation, or have a history of graft, embezzlement, or other loss in your supply chain. For example, easily "misplaced" goods like cigarettes that need to be distributed to lots of retail locations.
Who cares about proving how physically access-restricted your server room is, any funny business will be noticed right away.
People holding cryptocurrency would notice an illegitimate takeover of the blockchain right away because they'd be trying to spend cryptocoin which, all of a sudden, they no longer have. But regulators aren't trying to tally up business inventory on their own ledger so that they can send it off to other parts of the business and all of a sudden that kind of logistics fails for the regulator because of what you called "funny business". A regulator is a passive observer, and a passive observer can't detect funny business without actively auditing the blockchain against their perceived notion of whether the current state of the blockchain is normative... which is a very difficult problem indeed to do at scale, one which regulators today haven't yet been able to really automate, even with the relative certainty of a database (which a regulator could order regular dumps of, for analysis, if it wanted to).
The few protections it does offer against tampering can be achieved in a much simpler way for your scenario (signing)
Identity/reputation: If you have a certain reputation on eBay, you can't carry that reputation over to Amazon to sell goods. You must start from scratch. If the reputation score was independent of the service you could even post it on Craigslist and people could trust it.
Real estate: I paid a lot of money for a completely useless title insurance. If the details of a home title were stored on a blockchain, there would be no need for this entire industry of bloodsucking leeches. :)
Supply chain: there's an ad-hoc network of suppliers for many things (cars, planes, electronic doodads). There is no central authority, and it spans the globe. Having perfect knowledge of the supply chain can save companies lots of money. It's what made Walmart successful, now everyone can do it on a shared platform.
The tech for this stuff is still very primitive. I'd compare it to when Jaron Lanier started virtual reality in the late '80s. He was right but several decades too early. There are still some limited contexts where a current blockchain can be useful right now, but it won't be a big thing for a while.
- employment at an enterprise company with a blockchain research division
- employment at a blockchain startup
- contracting at a blockchain startup
- contracting at an enterprise company with a blockchain application
- contracting at an enterprise company exploring a blockchain application
- forming a contracting company to sell blockchain ideas to enterprise companies
- trading cryptocurrencies
- selling services for cryptocurrency traders
- launching an ICO
Blockchain solves problems around auditability, but it doesn't really solve the practical difficulties around the original CDW vision. If you weren't able to make a centralized data store work with a sql database, you're not going to make it work with a distributed ledger.
>If you weren't able to make a centralized data store work with a sql database, you're not going to make it work with a distributed ledger.
The solution is clear: blockchain microservices. Each microledger is localized to the team using it, allowing for individual ledgers to be reused and composed to facilitate organizational agility across the enterprise. Stakeholder mindshare will soar.
Another example would be trades: Most people think of trades as buying stocks and bonds in an open market but there's a lot of private/internal-to-an-organization markets too. The blockchain is an excellent way to facilitate such transactions.
Being in banking (where we're trying to take advantage of blockchain transactions) the objections from management so far have been surrounding the inability to "undo" a transaction. Even though you can just make the same transaction in reverse afterwards the price of whatever it was that you're trading could've changed resulting in some troublesome circumstances.
For it to work you have to negotiate contracts ahead of time to ensure that all parties participating understand the ramifications of such a system. Since the blockchain is new technology it will be difficult to get 3rd parties to sign of on such things.
I would think that blockchain requires it to be a distributed ledger. A non-distributed digital ledger is simply a Merkle tree?
" So if you're transferring money from one bank to another it makes it all but impossible to mess with that transaction in flight (man in the middle attacks, timing attacks, replay attacks, etc)."
You can use non-blockchain cryptography to guarantee that.
Not in the same way though. An attacker could still modify the transaction after-the-fact at both endpoints during or after reconciliation processes (sadly, most banking transactions still happen in batch and there's multiple reconciliation processes every day). They could hack the reconciliation process(es) to undo or modify transactions later in the same day or--depending on the banks in question--days later.
Then there's also the possibility of just changing balances at one end of the transaction (flat out) with no way for the 3rd party to perform the equivalent of double-entry accounting to verify that the amount received matches what was sent. Bank transfer reconciliation catches problems like this all the time and it's baffling to me (but apparently has legitimate causes).
A blockchain would completely negate any such attacks and make reconciliation pointless.
If that’s the definition of a blockchain then it must include proof-of-work. Data doesn’t become incorruptible because you put it inside a block that points to the hash of a previous block.
It just happens that ledger is a quite good fit for document timestamping, and account balance can be used as a way to transfer money-like values (note that it's not the only way; cryptographers have a history of developing digital money systems).
About the only thing new about blockchain is that it doesn't need a trusted third party (system with rights and means to modify the data) to timestamp documents to defend against adversarial modifications to the timestamps stream.
Anyway, anything that would use ordering of documents/messages could be built on top of blockchain, but calculating proof-of-work is a very steep price to pay for the defense against some of the participating servers being malicious, given that enterprises happily trust regular databases that don't sign cryptographically anything.
In practice, I have yet to see anything concrete, but I haven't exactly been looking hard.
"In theory yes, in practice no" - sums up every explanation I've seen of whether blockchain technology could be applied to a particular problem. I still haven't seen a "killer app" that's not better suited to a traditional database.
Bitcoin became useful because it's an unregulated currency that has enough acceptance to be liquid and enough anonymity to be used for clandestine purposes. As soon as you try to use blockchain tech for "traditional" transactions you end up eating the computational cost of a distributed ledger for no apparent benefit.
Actually most value will go to enterprise architects who can hire their friends as consultants.
On the other hand such a system might make the individual votes less anonymous ...
Edit: campaigns and any other interested party such as the press
Auth is handled by the stock exchange and votes / proxies are handled on the block chain portion.
I wasn't involved in the project, but it seems like the primary benefits are public auditability and the immutable nature of the transactions were the value drivers. As implemented, full trust is placed in the (non block chain) central exchange for initial vote assignment and all auth.