Blockchain’s technology of trust

If you have been following the hype around cryptocurrency investments, you will certainly be familiar with “blockchain”, the record-keeping technology behind the Bitcoin network. Blockchain is literally a chain of blocks, although, in this case, it refers to information (the “block”) that is digitally “chained” together and often stored in a public database. Because each computer in the network has its own copy of the blockchain, it is also very safe, as a hacker would need to manipulate copies across the decentralized network in order to violate the system. This is what is meant by blockchain being a “distributed” ledger.

Bitcoin was the first globally distributed ledger network, but the technology has begun to spread across the global economy as a reliable way to store data concerning other types of transaction. The emergence of new and exciting applications of blockchain and distributed ledger technologies presents wide-ranging opportunities to support efficient and secure real-time transactions across multiple sectors. Blockchain is a digital platform that facilitates transactions by recording and verifying data across different industries in a secure manner. Its decentralized cryptography-based solutions minimize the agency of third-party providers, thereby reducing transaction costs and enhancing transparency.

Chain reaction

Understanding how blockchain works would maximize its business potential and its extensive adoption. Deloitte’s 2019 blockchain survey showed that the technology’s adoption has shifted and has already evolved towards the development of robust enterprise-ready solutions, reinforcing the fact that blockchain is real and that it can serve as a practical solution to many business challenges.

As blockchain proves its versatility in facilitating secure transactions across different industries and sectors, people are starting to sit up and pay closer attention to its potential. Blockchain offers an environment where users can freely interact in an ecosystem commanding minimal to virtually no cost at all, at a pace that can make corners of the globe reachable in just a matter of minutes. Though an emerging technology, its applications can already be seen materializing across a wide spectrum of sectors: banking and trade finance, supply chain management, law enforcement, energy, insurance, real estate, and many more.

Nonetheless, for a pioneering technology to work on a global scale, it first needs to create an agency of trust. In this regard, standards have a role to play in establishing public trust to promote the adoption of this technology. This is where ISO comes into the picture to ensure that the blockchain interactions follow internationally applicable rules, norms and procedures. The international standardization efforts for blockchain and distributed ledger technologies being carried out in ISO’s technical committee ISO/TC 307 seek to standardize the blockchain concept and the mechanism to support it.

ISO at the forefront

With increased transparency, improved economic efficiencies and higher standards of living as some of the key benefits of utilizing blockchain, there is a call for the development of an appropriate standards framework to establish market confidence for this technology. ISO/TC 307 heeds this call by developing International Standards and emphasizing the critical role standardization plays in building consensus amongst the stakeholders of this technology.

The committee’s Chair, Craig Dunn, says the aim of ISO/TC 307 is to meet the growing need for standardization in blockchain. “We can achieve that by providing internationally agreed ways of working to improve security, privacy, scalability and interoperability and so encourage the technology’s widespread adoption through greater innovation, enhanced governance and sustainable development,” he says. Blockchain technologies are a means of achieving trust and security when making exchanges.

With more than 50 countries participating in the standards development process, the work of ISO/TC 307 promises to provide the necessary clarity to support the development of future blockchain standards. Issues relating to the technology’s security, privacy and identity are also managed collectively in the work of the committee.

Creating an inclusive environment and allowing equal and appropriate representation of the relevant stakeholders are of utmost importance. The developing nature of blockchain technologies means, however, that there are limited subject matter experts and Dunn encourages other organizations and individuals to become involved in the work of ISO/TC 307. “The great thing about ISO standards is that they are developed by the very people that need and will use them, involving experts from all over the world. The greater number of experts involved, the greater the relevance and usability of the standards we develop,” he adds.

It can work for us

With Bitcoin and other cryptocurrencies picking up steam from blockchain technology, more focus is being given to the underlying distributed ledger technology that powers these digital currencies. Caroline Thomas is CEO of Objective Technologies Global Group, a company specializing in emerging technology solutions, and Convenor of ISO/TC 307’s working group WG 6 that focuses on use cases of the technology. She zeroes in on some of the most compelling uses that blockchain offers our modern world. These business applications (see below) are being tested across the world with promising outcomes and can unlock values in areas of multi-sectoral industries where trusted intermediaries are obliged to maintain integrity among their transactions.

Because blockchain technologies are uniquely suited to verifying, securing and sharing data, they’re ideal for managing multi-party, interorganizational transactions. Recent times have revealed that blockchain has proven to be a technology fit for a pandemic era. In the United Arab Emirates, for example, the technology is being used to combat the spread of coronavirus using blockchain for digital authentication of official certificates and other documents to deter the public from visiting government offices and service centres. Digital identity is used for accessing government services remotely.

A risk spectrum is inevitable in adopting new technologies, but in the presence of a crisis, the need to get things done must prompt us to come up with global solutions with an innovative mindset. “International Standards can help facilitate adoption by establishing foundational benchmarks that feed into global trade and social policies. When global issues force faster decision making – and when we are facing global problems where all parties are impacted – standards combined with new ways of thinking can facilitate immediate consensus building. This can help accelerate the use of blockchain in the foreseeable future,” Thomas says.

Getting everyone to agree

Recent events have shown that it’s not the technology that is holding blockchain back, but rather human barriers. In short, a solution’s value is often directly linked to the value of the network it serves. As the technology continues to mature, one of the biggest stumbling blocks on the path to blockchain’s extensive adoption is stakeholder management – bringing key players and unlikely collaborators together to solve shared problems.

Julien Bringer is CEO of Kallistech, a company specializing in security solutions, and Convenor of ISO/TC 307’s working group WG 2, Security, privacy and identity. An expert in cryptography, he cites blockchain’s decentralized system as one of the main barriers to its wider deployment. “Utilizing the technology requires a change of paradigm. In the context of blockchain, the power lies not just in one party or user, it obliges a consortium to come together to ensure that the system works in a trusted manner,” he says.

Economic and political structures are other decisive factors in getting ecosystems to adopt a particular way of operating and doing business. In a blockchain ecosystem, the technology is realized through collaboration with other parties in an ecosystem and by establishing consortia. In the real world, however, not everyone will have the same interests, hence the lack of consensus between end users and stakeholders. The key is to get everyone to agree and this is where ISO’s consensus-building role can accelerate the adoption of blockchain technology.

The power of possible

In essence, blockchain is an emerging technology capable of providing networks and organizations worldwide with improved security, transparency, accountability and efficiency through borderless peer-to-peer transactions. This is why the technology, and the cryptocurrencies that made it mainstream, are here to stay and have the power to transform all sorts of industries and aspects of life.

New ecosystems are now using blockchain-based infrastructure and solutions to create innovative business models and disrupt traditional ones, keeping in view the ­technology’s possibilities and limitations. In any marketplace, all participants have to be connected. With blockchain, we can build new kinds of market platforms that are collectively owned by the participants and build cross-enterprise workflow engines that enable the sharing of business data and processes across organizational boundaries.

But one question remains: Does blockchain really work? As an emerging technology with multiple use cases – and with ISO’s promise to take it to the next level with relevant standards – yes, it definitely does. So how can we make the technology work for us? That, we will need to find out for ourselves – it’s only a matter of trust.