The Public-Private Blockchain Singularity could also be Close At Hand

by Admin
5 minutes
The Public-Private Blockchain Singularity could also be Close At Hand

The following article originally appeared in CoinDesk Weekly, a custom-curated newsletter delivered every Sunday exclusively to our subscribers.

Nearly a year ago, at Consensus 2017, I saw blockchain lawyer Marco Santori, who made a stimulating observation.

The industry was during a transition phase, because the “blockchain not bitcoin” talk about 2015 and 2016 was getting old and cryptocurrencies were close to come with a vengeance, fueled partially by the initial coin offering (ICO) boom. So, both the enterprise blockchain and crypto sectors of the industry were well represented among the gang of two ,700 gathered in ny .

But Santori remarked that neither camp appeared to be talking or interacting much with the opposite . that they had essentially become two separate industries.

And understandably so. The enterprises, particularly the regulated financial institutions among them, were afraid to the touch bitcoin or anything love it with a 10-foot pole, given its past associations with dark markets and other illicit business.

The crypto enthusiasts, for his or her part, were perhaps bitter about the condescending attitude that “blockchain 2.0” types had taken toward bitcoin, the very innovation they claimed inspired them.

Early adopters who believed this technology could change the planet for the higher were also a touch underwhelmed by the enterprise crowd’s comparatively prosaic goals (e.g. making a bank’s back office operate more efficiently) – and skeptical that a “private blockchain” could even work.

So perhaps the bifurcation was inevitable. But i think there could be just a touch more cross-pollination at Consensus 2018 next month.

Shades of Satoshi?

Consider a number of the stories on CoinDesk last week.

First, an executive from the energy giant BP said it’s hospitable working with companies that have done ICOs and which it'd even think about using a public blockchain at some point .

The next day, executives from the insurance giant Allianz told CoinDesk’s Ian Allison about an indoor token they’ve been developing to maneuver money between its many global subsidiaries.

Granted, the project uses a proprietary blockchain from a startup called AdJoint. But it's a token nonetheless, so it doesn’t quite align with the old saw “I don’t care about the currency, I’m only curious about the technology.”

Further, the Allianz executives were frank about their hope that it could at some point reduce the company’s reliance on the legacy banking industry – a faintly bitcoinesque aspiration.

There are other signs of a coming convergence, too.

As CoinDesk reported earlier this month, Hyperledger, one among the large enterprise blockchain consortiums, has started opening its code to ICO projects. The Sovrin Foundation, a Hyperledger member that's developing a decentralized identity system, are going to be one among the primary to boost money by launching a crypto token using the consortium’s code this summer.

Strange brew

Perhaps the oddest mash-up of public and personal is Hedera Hashgraph. Unveiled in March, it’s a public network with a cryptocurrency (though its consensus mechanism, Hashgraph, is different than a blockchain).

But unlike bitcoin or Quorum or Hyperledger or zcash or R3’s Corda, Hashgraph isn’t open source. It’s patented by Swirlds, the enterprise software company that developed the technology. The advantage of this, consistent with the creators, is that the Hedera public network are going to be immune to forks; if someone tried to clone it, the Hedera Hashgraph administration promises to sue.

Still, the code are going to be publicly reviewable, developers are going to be liberal to build applications on top of the network without a license, and anyone who wants to can found out a node. So it’s permissionless, up to some extent .

Even R3, a corporation whose name is nearly synonymous with the concept of gated ledgers, is edging ever gradually within the direction of openness. The consortium’s broadened vision for the Corda platform contemplates connecting a good range of companies (airlines, hotels, travel agents) across the world , not just banks like its members.

Richard Brown, the startup’s chief technology officer, describes the goal as “an open shared network – but still private, secured and permissioned.” Die-hard decentralists will scoff, but this sounds a minimum of a tad more ambitious than the Wall Street-focused R3 of 2015.

It’s early yet to declare a full-blown melding of the 2 worlds. But continued tiptoeing by enterprises toward the realm of public chains would support the thought that an open, global financial network is more useful than a balkanized one – even as the web did more to make value than the company intranets that were hip in the1990s.

In any event, if you come to Consensus 2018 next month wearing a suit, don’t be afraid to strike up a conversation together with your hoodie-clad fellow attendees, and the other way around .

You guys just might learn something from one another .