Webinar Recording

Blockchain - How to Separate the Hype from Reality

Name: Blockchain - How to Separate the Hype from Reality
Uploaded: 2017-03-23T12:00:00+01:00
Duration: 56 min 38 s
Description: Blockchain has taken the world by storm since the inception of Bitcoin. While the primary interest has been in the financial and insurance industry sector Blockchain technology has wider application. This webinar will describe the technology and separate the hype from reality, looking at some innovative Blockchain applications from identity management to the Internet of Things.

Posted on Mar 23, 2017

Blockchain has taken the world by storm since the inception of Bitcoin. While the primary interest has been in the financial and insurance industry sector Blockchain technology has wider application. This webinar will describe the technology and separate the hype from reality, looking at some innovative Blockchain applications from identity management to the Internet of Things.

Webinar Presentation, KuppingerCole

Video Description

Show Transcript

Good morning for those of you in Hong Kong and Singapore, a good afternoon for those of you in Australia, this is a Capol webinar. The topic is blockchain, and I'm sure we are all aware of the fact that there's been a lot of hype around blockchain. And the intent of this next few minutes is for us to try and separate that from the reality so that we can indeed plan properly for the digital transformation that's going to come about as the result of blockchain technology.

Now, this particular webinar was supposed to be assisted by Bruce Hughes. Unfortunately, Bruce is quite ill. So Martin has gladly stepped to us with this particular webinar and Martin for that one slide about us and are the services that we provide. The company was founded 14, 12 years ago now in Germany and has expanded since then. And we do have Capol Asia Pacific headquartered in Singapore Capol is an independent Analyst Analyst organization offering absolutely vendor neutral advice.

We are thought leaders in the topics of information, security, identity, and access management, governance, risk management, and compliance, and in digital transformation. So the topic today is focusing on blockchain and the digital transformation that is coming through that technology in terms of the services provided by Capco. There's three legs to the stool. One is research, and you can go onto the website. You can sign up for a 30 day free access to that research. I would encourage you to do that. Then there's the events.

The biggest one is European identity and cloud conference coming up in may more about that on the next slide. And then there's the advisory services.

If we, as KA can help you with the strategic decisions that you must make in the areas of the identity and access management, cloud migration, cybersecurity, digital transformation, please do not hesitate to contact us because we would like to help you set that strategy to make your business successful KA corporate conferences. As, as I mentioned, EIC coming up in may in Munich, please be there. If you are interested in identity and access management in the cloud migration cybersecurity, please be at that AC that conference in may.

There's also the consumer identity world conference, which started in Paris at the end of last year is coming to Singapore in the AsiaPac region and also Seattle in the United States. The, that particular world tour is focusing on what does it mean to manage consumer identities? And why is that so important for businesses and for government?

So please, if you can do attend that conference, some guidelines for the webinar, unfortunately we have to all be muted. And so if you have a particular issue, please send that in to us. The webinar though is being recorded and you will get access to that recording, and you would be able to download that and watch it at your, your leisure later, in terms of question and answer, we would encourage you after the event to send in your particular questions. And we will get back to you with an answer to, to those queries in the question and answer session.

We do have a couple of questions that we are going to be addressing that we think might come up during the webinar. And that'll give us the chance to expand on the detail that we, that, that, that we are presenting in the webinar today. Part one Martin Kuppinger will give us the background to the blockchain technology and what it means to us. I will talk a little bit about the examples from Australia, and then we'll have the question and answer sessions. So with that, I would like to turn over to Martin and Martin, please take us, take away the presentation.

Thank you, Graham, and also good morning, good afternoon or whatever. So you are to all of the attendees, as Graham said, I'll talk about some aspects of the blockchain and put us into the context of the digital transformation where I wanna start is with some view on how is entire thing related. So when we look at this digital transformation, what is happening here, we see a lot of external drivers. And if you look at these external drivers, we have things like changing competitive landscape. So Tesla RA, a new company became in a stride to establish automotive vendors.

A lot of changes in the finance industries through FinTech and so on. So we see this need for rapid innovation. We see a move towards products or moving from products to services. So people who don't buy their car anymore, but who trust paper use or follow up paper, use models.

We have, everything is connected. We have more regulations, but also more attacks. So there's a lot of change. And when we look at what is happening here, we have, from an organizational perspective, you see the need for a couple of organizational key capabilities. So which are agility.

So rapid change, we need to be far more flexible innovativeness coming up with new ideas, reacting on all the strange and the organizational flexibility, which also means there are certain so to speak key topics, major things organizations have to follow, which are on one hand, if it's a manufacturing com corporation and it's really about smart manufacturing or industry photo though, it's about the internet of things. So all these connected things, all this, that stuff, and it's about know your customer, not only know, but serve your customers.

So we have to deal differently with the customers and to do so. We have a couple of what I call the key enabling technologies. And amongst these technologies, we see big data. We see cognitive and maybe AI. So artificial intelligence, identity, security, privacy, the sensors, the robotics, and what we also see is blockchain. From our perspective, blockchain is one of these technologies, which clearly will impact a lot of the things of the innovations we see around this digital transformation, whether transformations fact is not a one time transformation.

It's an ongoing process of innovation, of adapting, to new competitors, of adapting, to new partners, types of partnerships and all that stuff. So blockchain is one of the key technologies in there. It's not the only one, but it's an important one over the course of the next minutes, we will dive deeper into blockchain, give you some backgrounds, but also talk about the potential blockchains have also the limitations blockchains have clearly. And as you can see, it's not the only technology. It's an important one.

It's one, which has a lot of potential, but there are also a lot of miss around blockchains. And that's what we try to clarify over the next couple of minutes. So when we look at the entire thing, there's a lot of, no talk about blockchain, but also lectures and Bitcoin and other stuff. So in fact, when we look at it start sort of, so to speak at the beginning, we have Bitcoin, which is a cryptocurrency, which relies on blockchain. And you might then say, there is at the beginning, there was very much to talk about.

The blockchain was a big B, so to speak where people said, okay, this is the blockchain used by Bitcoin. It might be the only one.

In fact, reality already has proven that it's not the only one. So in fact, there are many blockchains, which is, is the underlying concept. And right now we see many different blockchains on this notion of, okay, it's Bitcoin. This notion already has gone on the product concept behind that. So to speak is a distributed lecture. So a way to store data in a certain way, which can be used by various parties, which in fact is a repository for information around particular transactions.

This is basically what we see and distributed this distributed lecture in fact is sort of a variety of something we have in real world for hundreds of years, the lectures where we have this central sort of trustworthy store of information. In fact, what we are doing basically is we are looking at how can we create in fact, something which allows us to have such a trustworthy store of information, which we can use in a distributed way for new use cases.

And based on that, we see a lot of new capabilities, a lot of new things we can potentially do, and this is where the things really become interesting. So why does it matter some sample trust? So we see governments, not only UK government investing and research around digital currency. We clearly see a lot of things from the government, which say, okay, it goes beyond the pure blockchain and beyond the pure Bitcoin or cryptocurrency saying there are when such as IBM and others still wearing blockchain as a service, we see more and more of these offerings.

And we see a lot of commitments and massive amounts of money flowing into this market. And on the next two slides, Graham will talk about some more apex specific aspects. So Graham I'll go through slides.

You talk, Thank you, Martin. Yes.

I, I thought it very important that we do highlight a fascinating development within the standards Australia organization. They have decided that they are entering into setting standards for big for the, the Bigchain technology. And what they're looking at to do is to have an interoperability standard so that blockchain implementations can be integrated. The first step is to actually develop a, a terminology that we can all agree to. So we know what we're talking about, and then they're going to either have one or suite of standards.

That's not been decided yet to address three important components of blockchain use. The first is privacy. So Australia has some very stringent privacy regulation. And it's most important that as these open blockchains start to store information particularly about the identity attributes component there, that privacy regulation is adhered to. They also seeking to establish some security protocols that will help bring some control over what is in effect.

A very, as we've talked about distributed ledger environment, so there will be this new ISO TC 3 0 7 and then they are going to be looking to the adoption of existing standards, particularly in the governance section, that's ISO 38, 500 and in the risk management area, which is ISO 31,000.

So those, those standards are going to be part of brought into line with the bid chain, sorry, the blockchain implementation standards in terms of the major areas where the Australian government saw the application of blockchain, the first one, and it's an obvious one land transfers doing the property title. Registrations is a classic contract requirement that blockchain as well, seated suited to, but they also, I very interestingly identified that managing personal information information. So this is iden identification information that's needed, particularly for passport documentation.

And of course, passports make makes a component of that as well. So that was highlighted as an area where blockchain can contribute health records is another obvious one. And of course there's a lot happening in this space around the world now about how do we manage the access to, to health records. And more importantly, how do we manage patient consent? The blockchain has applicability in that space. The last one was vehicle registrations in terms of the, the greater than 50% vehicle registrations.

Again, that's a contract based type of information and makes sense to have that in a distributed ledger in terms of managing the registration of people's motor vehicles. Okay, thank you, Graham. And I think these are, are great examples because these examples are very much about lecturers. So how can I have a trust versus source of information, which changes over time, where I already put the things into the lecturer. And I think it shows that there it's a broad potential for blockchain use, which is not only in governance, but this government examples are I think, a very good thing.

So it's really about trust and integrity, which allows us to, to really do something better here to really allows us to be extremely strong in doing so. And we also have to be clear on the other hand, what the blockchain is, not the blockchain is not a database in the traditional sense. It's not a directory, it's not a file system. It's not a public key infrastructure.

So the blockchain or blockchains are something which are sort of a, a mix of a little bit of everything of that to some extent, but it's really a different way to deal with information, which allows us to better solve certain types of challenges. So to unleash the full potential of blockchains, we shouldn't think about them as a traditional data resource. So we need to understand what they are on one hand, yes, they are assigned append only lock. So we lock transactions and we can append it.

Only if we look at some details later on, on the other hand, they had a foundation for enabling new ways of business based each own smart contract. So we really need to look at blockchains in a somewhat broader way and to understand we can do a lot of different things. Also a lot of different things with a lot of different ways to implement certain types of blockchains.

And yes, we still have these, these purists. We have the ones who sort of say, that's the one blockchains or the Bitcoin one it's a little like was the lot of the rings, so to speak, no, it's not. There's the one central lecturer sitting in the middle and where other parties have to pay. If you look at so, so selling a property, we have it. And the man in the middle, so to speak, the central lecturer has to be paid. If he look at other approaches, we always will end up with, okay, there is a clearing house.

If you look at a stock trading, et cetera, and they want to get paid, and this is clearly one of the big potentials behind it. So if you look at this, from that perspective, the question clearly is what can we do better? And if we get rid of this man in the middle and create a distributed lecturer, which is on one hand available at certain places, which is an advantage, but which also gets rid of that third party somewhere in, so where the algorithm, instead of a trusted third party, trusted man in the middle, trusted, the mediary are used to establish trust.

Then we are in a better situation. And one important thing, there is the so-called consensus process, which we will come back to at a couple of times, this consensus process is highly important because it ensures that cheating at the end of the day is wider than depending on the ways we construct such ledger, that consensus process might vary. So we have some very expensive consensus processes in terms of computing power, like the one with the Bitcoin blockchain. But we also might have far cheaper consensus processes depending on one hand, which level of trust we need.

And on the other hand, looking depending on which type of electro reconstruct. So if the parties trust each other somewhat, then it's easier than in the cryptocurrency with a lot of layers in. So when we look a little bit at the technology itself at a higher level, and we can extend that it goes first, basically it says, we have couple of transactions, we have a hash, we have signatures and we chain this entire thing. So we have a chain of blocks of transactions. That should be a block CK in the top. So we have a chain of blocks of transactions, which are coupled to each other.

And each earlier one is part of the hash, which means if you try to change something on the left hand side, the mathematics, which calculates the hash on the, towards the right hand side will end up with a different result. And so you, if you want to, to, to, so to speak to cheat, you would have to recalculate everything from there on which is hard to do in the concept of that blockchain. So blockchains basically are a block of change chain.

A chain of blocks are that way, which are links through cryptographic algorithms, which ensure that you not simply can change something in an earlier block. That's basically the point here. So from there, I think it's then important to understand what are so to speak the, the rewards you might get by relying on blockchain technology. And there are a couple of these rewards. And so it's restless. There's no need for third party.

So which is by the way, from a business perspective, one of the most important one, because you might really get rid of some of these highly expansive third parties here, it's temper evidence. So we have through linkage of blocks, we have this integrity controlled. We have the sequence, the chronological certainty, however you'd like. So we have to transparency regarding what happened there. Due to the distributed nature, we have very high transparency. We have the bronze of transaction. So we have a couple of things. Basically.

I always say it's a sequenced timestamped shame of whatever happened transaction that happened, and it's pretty hard to temper it. And this is what we can potentially to some extent create, and for instance, a standard database, but it's hard to do. It's expensive to do. And it's really, really so to speak well done. So as I've said before, we should look at it as something which goes beyond Bitcoin. So distributed lectures are something which are bigger than really the Bitcoin, the cryptocurrency. And we have various types of these lectures right now.

And it's also was interesting for me to look at this when we, we, we, when this entire thing started. So I, more or less from the very beginning said, okay, I don't believe that we will only have one blockchain. I was pretty sure that we will see a variety of these with different consensus mechanisms. And so when I looked down at some point at the Wikipedia, the entry around blockchain also changed from this single Bitcoin view. The one blockchain ruled them all towards a far broader view on this. And I think that's really the way to go because we have different business problems.

And so we need different types of things. And so we have the traditional lecture. We might have private shared lectures where we say, okay, this is available only to the owner group, but it's something where we use distributed approach between a group of organizations.

It's a, might be very smaller community shared lecture in the sense of, for instance, only some types of finance institutions do it, which have some decent level of trust to each other, where we don't leave work in this anonymous approach of the, the Bitcoin blockchain, where we really work in a different way. And depending on how we do it, we might have different ways to maintain integrity. At the end of the day, even a community lecturer, there are some type of consensus, but it's a different type of a consensus.

And from there, the point also is what can we do based on these various types of technologies? So what can we do here? So one thing is the underlying technology. So we have this distributed, distributed lecture. We have the characteristics such as time stamping and some other stuff, but the other side of it is what else can we do on top of it? What is what really then allows us to create new types of business models?

And we, when we look at this, one of the important things here from our perspective are the smart contracts. So smart contracts are in fact, algorithmic algorithms or coded contracts saying, no, you, now you need a broker or not. Lawyer is only partially correct. Obviously there's also a legal aspect behind it. And we have to be somewhat careful at that point of time regarding smart contracts, because as always law follows reality with some latency. And in that case, it means some of the aspects of these contracts are a little bit more difficult from a legal perspective.

But anyway, we see a tendency towards them, such a smart contract, might for instance, say if you rent an apartment for vacation, which has an sort of an connected lock at the door that lock might open only during the period when you have booked it only when you come close with an RF ID device, you have registered and only if you have paid for that apartment. So the contract might combine various things, bring in some data from and connected device payment information and other stuff.

And then do a lot of things here, which on the other hand would mean you can't do this renting of holiday apartments. If you have the, the, the lock, the connected one on the door, you could do it in a different way because you particularly don't need that intermediary anymore. Who ensures that the payments are done, which would fundamentally affect for instance, the business models of players, such as an Airbnb. So moving ahead, what is happening here? We see a number of blockchain platforms. They differ the way the consensus algorithms are used. They differ the way the trust.

And here we are some, some examples of such distributed letter platforms. So really we have Bitcoin, we have athere, we have the Hyperledger project and several others, and we will see more of these over time. I'm con win. And we see a couple of large organizations already looking at how can I, IBM. I talked about Microsoft and some others, which are in fact, providing a blockchain as a service, which is Syrian basically also the dust. So there's the differences between such block, such as platforms for instance, are around the consensus algorithms.

So we're, ethere at some point changed and forward. So what is to be agreed and for whom is it, what is the target behind and who is to be trusted?

And so, just to give you another view on the, the, the multitude of SLS around the blockchain technology, I put in a, a picture from, from a website let's talk payments, which have some rather good overviews about blockchain use cases. And even while it might be a little, depending on your screen size might be also good to read. There are so many different ways to do it. There are so many companies behind that.

So this is really a, an large ecosystem, and it's clearly far more than cryptocurrency, many different use cases with very different requirements, with very different ways to do blockchain. So they common element that the end of the day is really to say, I have to way to connect blocks of transactional to chain blocks of transactions. That's where the term block chain comes from, and this is the essential element. And then they are where ways to do it. So there are, if you look at it, these lectures can have a couple of different attributes. So I'll develop it sort of step by step.

So basically we can look at security, privacy as one aspect and deployment and usage as the other. So we have things like authentication privacy, where these can differ lecture type the ownership. So we can have permission that UN permissioned. So who do I permission someone to add blocks? Or is it UN permission such as Bitcoin where everyone can do it, but based on a very complex consensus mechanism, anonymous versus ized versus identified then. So in some cases we know who's dealing with it. In other cases, we don't know. It depends also again, on, on the use case you have.

So if it's centralized, it's not really a distributed letter anymore. So we might say, okay, this is really not what we are looking for. The ownership had already touched there various ways to do it. So public community private. So when we look at this and create more, more of a, a metrics on different requirements, then we'll see, this is, there's a broad variety of potential types of blockchains. So depending on what you want to do, as I've said, there might be certain instances which are permissioned. It might be not anonymous.

And if you, if you say it's identified and permissioned, you have a totally different trust model and a totally different, you can use a totally different consensus mechanism than in the UN permissioned anonymous, distributed public cryptocurrency, blockchain, such as in Bitcoin. So there are really very many different ways. And so potentially there are, there's a broad variety.

So the, the green boxes, so to speak of potential blockchains between the traditional ledger, which is centralized, as of said, centralized is something where we should be somewhat careful with, but anyway, and depending on what we have here. So what we, which combination we take, there's an impact on the lecture characteristics. So the performance, the way we do the trust or the proof of work. So what is the consensus mechanism is the true proof of work proof, stakes, something else, the incentivization.

So if we don't need to invest that much computing power, our incentivization can be fairly different from an approach such as in Bitcoin, where there needs to be some payment for the bill you spend to your utility provider. And that also means it's different depending on what you do here.

It's, there's applicability to different types of use cases. So cryptocurrency clearly needs different characteristics. And it's also interesting to see that, that for instance, China is more looking at say, okay, we, we, we think about a cryptocurrency, but we don't want to have it anonymous. So I'd like to know who pays what here. Then it would end up a different type of blockchain, which still is a blockchain chain of blocks. So it's this type of distributed lecture, but it's clearly different characteristic, a different type of use case, smart contracts, the identity, and also dedication.

Things all have different requirements. And also the assurance has an impact. So this is more about a Rochester, or is it about for instance, the rules, like in smart contract? So depending on what we need, want to do, we have a different need for constructing sort of the underlying technology. I come to some predictions before I hand over to Graham. And if I look at these predictions, so one of these predictions is there will be many types of distributed lectures. And I think this it's not a prediction anymore. It's just reality. And the second also is true.

They are supporting various use cases, requirements. And based on that, not every blockchain will be slow in computing intense, which still is the prediction. To some extent, the evolution will become disruptive to many businesses and particularly all these businesses, you know, remember that, that intermediary thing sort of that instance in the middle, these are the ones who are so to speak most likely to become under pressure because there might be far more efficient business models.

For many of these, we start a hand back Tora who will then run through the next couple of slides before we then move to our sort of discussion style thing afterwards, Graham, it's your term. Thank you, Martin. I really appreciate those comments. And that inside you gave us into blockchain technology. I'd like to run through just a couple of examples where we feel that blockchain might be very pertinent. The first is in the government and legal space.

So in effect, any area where we need to have a record record, being able to be made public a repository of them, particularly when timestamping in, in is, is so important. So, and the contracts that we talked about before in terms of property, for instance, is an ideal example. The benefits here is the, the comes from the accountability and the transparency that we get through the blockchain technology it's accountable because of the extreme difficulty in interrupting the integrity of the information. And the transparency comes from the wider availability of that information by the internet.

So it's cheaper and much more efficient, particularly for government services to be provided through that sort of environment. And there's an interesting comment here. The last dot point on the slide, where in some situations there's a great deal of bureaucratic.

Can, can we say a time wasting activity where people are sitting in positions just in order to move data around blockchain means we no longer need that. So we're in a much more efficient environment and where that's applicable, we're into a digital transformation, the healthcare sector.

Again, that's an area where we do have vastly distributed data and we need to get available availability to it. And as we mentioned before, the privacy and security aspect of health information is absolutely paramount. And blockchain gives us the ability to, to handle that gives us that high data integrity, as well as giving us that accessibility to data, because obviously a patient can present at different healthcare facilities, access to that information is most important.

And the patient consent as, as again, an absolutely base requirement for any electronic health record facility in the research and innovation space. There's some interesting things happening there. As we all know, the researchers are involved in, in some cases, very large scale infrastructure requirements. They need to be collecting data from multiple places. They need to be able to recording the results of tests.

And as, as indicated, here, we need some checks and balances in a research environment. You must always be able to verify what's happening.

And again, the blockchain gives us that capability. So in terms of the benefits, the, the future, this is an interesting concept where in the past, we've often relied on scarcity of information. Once we move into the blockchain environment, that's gone and information becomes very apparent and indeed scientists can now spend their time doing what they should be doing rather than figuring on how do they get funding for the next stage of what they're doing. So blockchain has some definite application in the research and innovation space, internet of things.

We've all heard about what's happening in that space, where in a situation where we are rapidly having to cope with accommodating a vast number of sensors and actuators, and that each of them, each of the sensors is producing vast amounts of information. And just to be able to handle that and to be able to manage all of that data, the blockchain has some real applica applicabilities for us, particularly when there's potentially some events that we need to monitor for. And some alarming that needs to happen.

Having the blockchain transactional history, there is an important part of what needs to be done, benefits the supply chain Providence. So we have an assurance that a particular event has happened once it has been put on the blockchain. It becomes a very fault tolerant mechanism of handling our information of things, communications, particularly when we are dealing with collecting information that might be in very remote environments or in environments where there it's inhospitable this extreme or hazardous environments that some of this information's coming from.

So again, a local blockchain can accumulate that information and make it available to the organization. That's collecting that information and doing the data analysis associated with it. This is an interesting infographic that Martin Kuppinger has generated for us. And if there's one message that we need to come up with here and make sure we all understand is the digital transformation that blockchain is a component of.

So Martin, could I ask you to address this slide? Yes, I can do. So I only created to be honest, the fundamentals, I didn't create a graphics because I'm not very good at doing the graphics, but my team did it. And so basically a while ago, I put together some eight fundamentals around the digital transformation. And so we started going to deep into all of these. I think one of the things is it affects virtually, at least virtually every organization, some organ, some industries already gone through the transformation.

If you look at the publishing industry, if you look at the music industry, they already are in a, or also in some areas of commerce, they already are, are facing that transformation for quite a while. What I also strongly believe it's at absolutely here to stay. So we will not revert back to something earlier.

And it's, it's clearly more than just IOT. When you talk about transformation, it's really about how can you change your business model? How can you sort of reinvent your organization? What does it need for that? And I certainly believe by the way, when you look at, at, at the entire blockchain and distributed lecture technology, the combin combine combination of T and distributed S something, which is highly interesting.

So, so if you look at, for instance, some examples from, from, from leasing space, which are, are intensively discussed, and they are about collecting sort of realtime data, we, we are connected things which then affect the lease contract. So you have to lecturer to, to store the UN and the sequenced order and to have some time proof, yeah. Might have to smart contracts. And all the other stuff brought together. Some of the stuff, as I've said, might be done without the blockchain technology, without distributed lectures, but many of these things can be better, can be done better with it.

So we need to change our organization. We need to look at connectivity. We need to understand security and safety. And we also look, need to look at the entire identity stuff. So who is it? What is happening here and all these things.

So, anyway, without going to deep into that, we see this change, all organizations are facing as part of the digital transformation and blockchain technology can help us to do some of the aspects to deal with some of the challenges better than without grant back to you. Thanks Martin. Now one changing the, the focus for a minute.

I, I just want to, and this is gonna lead into our Q and a talk a little bit about the time for adoption of a technology such as bitch blockchain. There's a very interesting Harbor business review out at the moment that addresses this point and it makes the, it makes the case for the fact that time to adoption has two main factors. One is the complexity of the technology. And I think we must agree that the blockchain technology is quite complex in order to provide the data integrity that it does and the degree of novelty.

And again, I think we would conclude that the blockchain technology is indeed quite a novel technology, so quite high on, on that level. So that would, that would suggest according to Harvard business review, that the adoption is gonna take some time. If you've got low complexity, it's quite easy for people to adopt it. If it is not too novel, they will readily adopt it. And so you can get the single use environment. If someone, something is quite understandable, but is quite complex.

We get into the substitution area where there could be multiple solutions to that particular activity, but it's well adopted because the novelty's quite low. If the degree of complexity's low and the degree of novelties high, we are into this localization issue because it's dependent upon people to understand what the technology does for them before they will adopt it. And the hopper business review suggests that blockchain is indeed in that transformation sector. And so therefore it is gonna take some time.

The quote from HBR is, is blockchain decades from reaching its full potential in their view. It's a yes. And we are going to ha enter into a question time at the moment and discuss that component of it in conclusion. I think we need to all agree that in terms of blockchain, the missionary days are over it's. It is here. It's here to stay and is ready for the mainstream. In terms of corporate application, we'll definitely see improved service levels as result of, of, of blockchain with better reach, better security, more agile, more agility, and service delivery.

We can expect that to start happening soon in terms of so social application deployments, there's some fascinating situations there where the, the blockchain is, is, is coming up in some very innovative application. I'd like to just mention one, if I could slot it, sk.it do look what they're doing there in terms of control of I IOT devices and building around blockchain, the ability of individuals to make use of this new and innovative application, we're gonna see more regionally, regionally bounded services.

And we are going to see more non-for-profit or indeed services that have an ethically pure component to them, which is going to be a very attractive to the millennials of this world. And lastly, we are going to see a significant disruption of the, in terms of the digital transformation that this is going to, that's going to occur. This is going to be very heightened in third world countries, which don't share the infrastructure that we do.

And what blockchain's going to enable is services that we've come to appreciate and take, as for granted, they don't have access to these services yet, but the distributed nature of blockchain is going to give them access to that. So with that, we are going to just go into a couple of questions here. And the first one is a burning question, Martin, that I'd like to ask you is in terms of ready application of blockchain implementations, can you give us a couple of examples that you have seen come about in, in Europe or north America?

Yeah, so I think there, there are various examples right now. So if you look at just the large layer, such as what happens around the Syria, cetera, anyway, I, one of the really interesting ones I've saw at a, a French mutual bank organization, which started using blockchain for their KYC. So they know your customer process, which are driven by compliance regulations around you need to have all the contracts or all the side papers.

And so on signatures in place from your customers to do certain types of bank businesses for a mutual bank, it means you have a lot of sort of connected, but somewhat in independent institutions. And so to deal with it across such a group of banks, a distributed lecturer can be very, very large volume. And they even think about creating business models on top, because once they have sort of identified their customer and have good proof, they could also provide services based on that adhere. It's very clear that we have to distribute nature.

We have this need to do it in rise, a temp proof way. So the question always is, is something really a hundred percent temp proof.

So, but daily blockchain technologies are pretty temp proof. So you have the sequence. So are all these things done in the right?

All, all the stuff. So you have all these sort of things combined. And it's a very logically used case, a little bit outside of both north America and Europe and the Asia Pacific, but probably to be seen in other countries. It's more things like, like in middle America and south America countries are starting to put their land register on a blockchain. I think this is a particularly interesting example for two reasons. The one reason is yes.

Again, it's a classical lecturer use case. The other is it also shows that the blockchain will not solve everything. It will not solve all problems you might have because yes, once the information is in the Rochester, in the latch, in the blockchain, it's sample proof, but it doesn't solve the challenge of how do you prove that you are the one who owns that land when it it's put into the register the first time. So there are still things which a blockchain can't solve. The value really starts.

Once you have trusted parties putting informational and trusting that all this is done, correct from that point, things are so to speak far easier in such a blockchain. So this is maybe two examples from very different areas, which illustrate on the other end, a variety of things which could be done on block based on blockchains. Fascinating.

So, so you would definitely be in the campus, says that to blockchains here, to stay, we better get used to them in terms of the half a business review that they could be a decade off. Do you share that view or do you see that we're going to see more implementations coming through in the next few years?

So, so basically there are two questions. The one is, are they here to say, stay the second is when are there one, when are they becoming really mature? I personally believe to comment to the second point. Maybe first it will not take decades.

Yes, it takes its time, but there's so much money, so much momentum behind. So many people looking for, for use cases that is a little faster probably than, than we would expect. So we really see sort of a very rapid thing going on. On the other hand, this is really here to stay. When I get this question, I, I always say, hopefully we'll not talk about blockchain anymore in five years from now. Hopefully not. And you know why? Because the blockchain is just the underlying technology. And at some point we shouldn't look at it from a technical perspective.

We must look at it from the business use case perspective. And so the blockchain, to some extent, you know, it plays at the same level, lichen relational database management system plays for storing other types of data.

So yes, there are people who need to understand it, but there are a lot of people which don't exactly know what database you use. They look at it from a business problem.

They say, I have to solve the business problem. You need to start a data. Or if you look at the network level, so there's IPS and some people really understand it, but most people trust use it. And so blockchain, the discussion around blockchain and different ways of blockchain to, to create a blockchain, I think this should and will disappear. But the technology for itself, it's here to stay.

And it will be just something where we get used to say, okay, if we have a certain type of challenge to solve then something which relies on that type of technology is better than traditional database, but Graham. So, so I said, organizations are looking for use cases, not sure as are you observed same. I assume the question. I always ask myself to some extent Shelton organization really actively look for blockchain use cases. Yeah.

I, you make a good point. And, and I, I do agree that the blockchain component of it will diminish while we focus on, on applications.

So, no, we shouldn't be looking to have a blockchain implementation just for the sake of having one and say, oh, this, this is a nice, shiny new technology. Let's use it. It's about more understanding the, the inherent benefits of blockchain, understanding where it fits with our, our own particular environment, but then not being hesitant to actually implement and to be innovative enough to say, this is a technology that appears to have some real benefit to me and my business. Let's give it a go.

So, you know, I think in terms of, of the, the, just coming back to the finance component of it, as you mentioned, there's the, the Bitcoin is obviously the most well known example of a, a, a big blockchain. And, but, but there's lots of others. And would you agree that there's, it's definitely not the only one and we are going to see many other implementations of cyber currency. I think we'll see both. We will see different cyber cryptocurrencies. Yes. So that's the common term which of them will survive and which not that's up to, to be decided by, by reality over time.

So what we also will see, we will see a lot of different, as I've already stated. We'll see a lot of different blockchain implementations for different types of requirements, for different types of use cases. And I fully agree with you.

Yes, organizations should not sort of say, I try to find a business problem to build a blockchain start always with to, so I think what organizations really should do are two things understand what this is about and understand the press of things you can do based on blockchain technology and understand what it means. What are the sort of, what is the price to pay? What are the consequences?

What are the differences in consensus mechanisms and where is a blockchain based approach, really better than a traditional one in some areas, it is in some areas you might question, and then if you have misunderstanding, and then you look at your business challenges and particularly ones where you feel they are hard to solve this traditional, it approaches particularly the ones which are around sort of, you needed to exchange information with other parties distributed, which about temp proof and all that stuff.

So that things really, which are at the center of that technology, then you might find CEO, yes, I have this problem. And I track whether the blockchain is better to use, but not say, oh, there's the blockchain. Where's the problem.

Say, there's the problem. Is the blockchain the better way to do it? That's what I would add here, from my perspective, Super well look, Martin, our time has gone. I thoroughly enjoyed the conversation and your presentation. I trust that the participants have helped to sort of divide the hype from the reality. And indeed, if there are questions that come to mind, please send in those questions and we will respond with answers to those individually. Thanks again for your time. Thank you.

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Blockchain - How to Separate the Hype from Reality