Posts Tagged ‘Bitcoin’

Block Bits and Chain Coins: The Trust Machine Jigsaw

April 1, 2016 3 comments

The topic of Bitcoin, and other cyber currencies, as well as the underlying Blockchain technology is still top of mind for various industries, with frequent: events, blog posts, articles and sundry news items firmly focused on them.  I have also contributed to the deluge with a recently published article in the BCS ITNow magazine, as well as a forthcoming event on the “darker side of Internet technology”, but more on that later.

Last week I attended a BCS London Central event about Bitcoin technology “that could change the world”, featuring Simon Taylor, VP Entrepreneurial Partnerships at Barclays bank. As you might imagine, banks and other financial institutions are at the cross-hairs of any impending / potential disruption by Bitcoin and its Blockchain technology. Given the history of other similar disruptions in other industries, many financial institutions have been quick jump into the ring in order to figure out the best way to take advantage of the new challenge / opportunity rather than just sit back or ignore it.

To this end, Simon did a great job shedding some light on key initiatives by members of the financial services, (including banks and Barclays in particular), on the topic of Bitcoin and other crypto-currencies. My top take-aways from the event include:

  1. Building Blocks – Bitcoin is great, but platforms like Ethereum have really made Blockchain relevant for organisations to build their own applications – i.e. by providing the Lego building blocks for creating useful applications for the banks of tomorrow.
  2. FUD still rules – Opinions differ and people argue as to just what is Blockchain. Is it just the underlying technology used for Bitcoin, or does it include other incarnations and applications of similar mechanisms? A lot of confusion is being caused by misconceptions around Blockchain – e.g. “people keep coming up with Blockchain ‘solutions’ for just about anything”. However, if you do use Bitcoin based solutions, you must beware of implications for data protection, Safe Harbour and industry regulations.
  3. Using a hammer to crack a nut – Simon questioned whether it was really necessary to put up with the immense overhead required for permission-less ‘proof of work’ systems such as Bitcoin, when the faster permissioned versions could be just as effective, albeit with a certain degree less end-to-end security, integrity and non-repudiation capability in comparison to Bitcoin.
  4. Bitcoin keys can also be lost or stolen – Blockchain does not provide a solution for key management, so How can this be mitigated. This could be a potential role for trusted intermediaries, such as banks.
  5. Q&A: How can other organisations (e.g. NHS) successfully leverage such tech? – Simon’s advice to the NHS Director in the audience was to get educated on the topic and then experiment like mad. Barclays does this by first creating an experiment script or hypothesis then outsourcing the work to local / friendly start-ups for rapid turnaround. The resulting outcome is then studied and pulled apart by multi-disciplinary experts from Barclays (e.g. compliance / risk / security teams) before a recommendation is made. Most other industries can follow this model.

Overall, I thought this was a good event which was well attended by a very engaged 100 strong audience. The chosen topic and focus also made a perfect setup for the aforementioned BCS “Darkside” event which is scheduled to take place on 26th April, and features some excellent speakers and their perspectives on the seamier sides and uses of Bitcoin and Blockchain technology. Don’t miss it!


Governing the Internet of Things.

February 28, 2015 Leave a comment
In light of increasing coverage about the so called “Internet of Things” (IoT), it is not surprising that sovereign governments are paying attention and introducing initiatives to try understand and take advantage of / benefit from the immense promise of the IoT. Despite the hype, it is probably too early to worry about how to govern such a potential game changer, or is it?

According to Gartner’s Hype Cycle for Emerging Technologies, the Internet of Things is hovering at the peak of inflated expectations, with a horizon of some 5 – 10 years before reaching the “plateau of productivity” as an established technology, so still fairly early days as yet, it would seem. However, that is not sufficient reason to avoid discussing governance options and implications for what is arguably the most significant technology development since the dawn of the Internet itself. To this end, I attended a recent keynote seminar on policy and technology priorities for IoT (see agenda here), and below are some of the key points I took away from the event:

1. No trillion IoT devices anytime soon –  According to Ovum’s Chief Analyst the popular vision of ‘a Trillion IoT devices’ will not appear overnight, for the simple reason that it is difficult, and will take some time, to deploy all those devices in all manner of places that they need to be.

2. What data avalanche? – Although a lot of data will be generated by the IoT, it shouldn’t come as a surprise that the proportion of meaningful information will depend on the cost to generate, store and extract useful information from the petabytes of noise – there is a lot of scope for data compression. For example, the vast majority of data from say environment sensing IoT devices will likely be highly repetitive and suitable for optimisation.

3. Regulatory implications – OFCOM, the UK’s Data regulator, identified the four themes as most relevant for the future development of  IoT, i.e.: 1. Data privacy (including authorisation schemes); 2. Network security & resilience (suitable for low end devices); 3. Spectrum (e.g. opening up 700Mhz band and other high / low frequency bands for IoT); and 4. Numbering & Addressing (need to ensure there is enough numbers & addresses in the future for IoT).

4. Standards and interoperability – these remain key to a workable, global Internet of Everything (IoE) particularly because of need for data availability, interoperability (at device and data level), and support for dynamic networks and business models.

5. Legal implications – again the key concern is data privacy. According to Philip James (Law Firm Partner at Sheridans), in describing the chatter between IoT devices: “hyper-connected collection and usage of data is a bit like passive smoking – not everyone is aware of it”.

In context of the above observations, it may be easy to ignore the elephant in the room, i.e. how to manage unintended consequences from something as intangible as the future promise of IoT? What will happen if and when the IoT becomes semi-autonomous and self reliant, or is that science fiction?

Well, I wouldn’t be so sure, because it all boils down to trust: trust between devices; trust in data integrity; and trust in underlying networks and connectivity. However, this is not something the Internet of today can provide easily, therefore some interesting ideas have started percolating around scalable trust and integrity. For example, Gurvinder Ahluwalia (IBM’s CTO for IoT and Cloud Computing) described a scenario using hitherto disruptive and notorious technologies (i.e. Blockchain and BitTorrent, of Bitcoin and Pirate Bay fame respectively), to create a self trusting environment for what he calls “democratic devices”.

The implications are astounding and much closer to the science fiction I mentioned previously. However, it is real enough when you consider that it requires a scalable, trustworthy, distributed system to verify, coordinate, and share access to the ‘Things’ on the IoT, and that key components and prototypes of such a system already exist today. This, in my opinion, is why sovereign governments are sitting up and taking notice, as should all private individuals around the world.