Kathy Gibson is at Fujitsu Forum 2018 in Munich – Blockchain is by no means a new technology, but it is poised to underpin new and innovative applications that will have a profound effect on how we interact with systems and one another.
An everyday example would be a distributed database of vehicle services and interactions so that used car buyers can be confident about the mileage and service history of the car.
This database would be secure, transparent and immutable, as well as distributed, says Dr Joseph Reger, chief technology officer of Fujitsu and Fujitsu Fellow.
The blockchain is enabled by powerful computers and fast networks.
How it works is that, every time there is a new transaction on the network, everyone gets copy, with the transactions held in blocks.
These blocks are linked into a chain by logic. Each transaction includes he whole foregoing block together with new transactions.
The problem of storage could become an issue; which is solved by the hash, a unique representation of content that is accurate and sensitive.
The blockchain is mostly secure, but it can be hacked, Dr Reger says.
“However it is hard to add bogus blocks. It requires enormous CPU power to do so, and this is expensive just in terms of the electricity it requires.
“Plus you are racing against chance since everyone has the same capabilities, so you are running against the whole network. The race is against everyone and everything.
“This is well thought-out and is rock solid.”
The blockchain is a replicated distributed ledger with no central authority, Dr Reger explains. It is irreversible and immutable, timestamped and therefore traceable, accessible and transparent and protect by both cryptography and probability theory.
Dr Reger adds that the next era of trust will be distributed – and blockchain could be a very good implementation of distributed trust.
Trust was built into the blockchain from the beginning, he adds.
Blockchain 1.0 was secure, simple and static. “It was rather slow and couldn’t scale well.”
It became programmable with the second generation and launch of Ethereum, which was more sophisticated, faster and allowed for smart contracts.
“This is a milestone in the development of blockchain,” Dr Reger say. “Smart contracts are code, which can live on the blockchain along with data.”
Because it is programmable, huge development communities are flocking Ethereum.
Scalabilty is still an issue, which should be addressed in the third iteration of blockchain, D Reger says.
This is scalable and much faster, and will be suitable for applications like Internet of Things.
Notwithstanding, scalability is still a technical challenge for blockchain.
“It presents a trilemma – you have a choice of three items and you can have two but not all three,” Dr Reger explains.
The choices are transactions, storage and energy – since one of these would have to be sacrificed, the issue needs to be addressed.
The second concern is privacy and GDPR.
“GDPR implies there is a right to be forgotten. But the premise of blockchain is that there is no forgetting. so we need to do some work around this, possibly via encryption.”
The final challenge is quantum-safe encryption. “Quantum is a threat to some encryption.” Dr Reger explains.
A huge amount of development is going on to ensure the availability of blockchain-based applications in a variety of use cases and across a range of industries.
Insurance is an obvious contender for blockchain, Dr Reger says. Other industries include financial, IT and cybersecurity, health, assets, access management, security, industrial manufacturing, utilities, retail, transport and tourism, public administration and the Internet.
Companies still battle to identify where they could use blockchain, or if planned projects will be feasible.
Fujitsu has established a blockchain innovation centre in Brussels to help customers figure out these questions.
“It is clear that blockchain is not going to be a single technology or solution – or even single blockchain model,” Dr Reger adds.
Blockchain models include public or private; unpermissioned and permissioned. Typically, enterprise blockchains would be private and permissioned like Hyperledger.
Hyperledger is a co-operative project to provide open tools. It is managed by the Linux Foundation and has about 300 members. Fujitsu is a premier member
“We particularly like the Hyperledger framework and tools,” Dr Reger says.
Fujitsu is also working on tools that will help companies to integrate blockchains into their enterprise systems.
Ken Kanakura from Fujitsu’s blockchain research centre in Kawasaki, says the ConnectionChain bridges the gap between two blockchains.
“This is highly reliable since all the data is on the blockchain,” he points out.
In instance where all the data isn’t on the blockchain – either because it is too big, or its held in another database – the virtual private digital exchange allows for a transparent and distributors data exchange without disclosing the data itself.
“In this architecture, the blockchain manages the metadata and access policies,” Kanakura says. “It allows for a trusted data exchange market by using decentralised and immutable logic.”
It’s quite easy for enterprises to get started with blockchain, using blockchain as a service (BaaS), Dr Reger adds.
“This is a ready to go environment, good for rapid implementations or proof of concept projects.
“I am impressed by blockchain; it’s a clever scheme, and I think it has huge potential,” Dr Reger says.
“Even though some aspects still need to be ironed out, it will be important for creating a better Internet for the future and for better applications today – and it will be very relevant for the public sector.”