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EU Blockchain/DLT standardisation workshop - Strategic Plan 21st October 2017

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Overview of Blockchain ISO Standard TC307. The History, vision and approach to Standardisation.

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EU Blockchain/DLT standardisation workshop - Strategic Plan 21st October 2017

  1. 1. Blockchain/DLT standardisation workshop – Strategic Plan Benoit Abeloos - Policy Officer - EC, DG CNECT, Startups and Innovation Unit Gilbert Verdian – Chair of DLT/1
  2. 2. Background on Standards Australia Proposal (2015)
  3. 3. 3 HistoryAt HM Treasury • Introduced HMG to Bitcoin and Blockchain • Economic assessment and policy review • Concluded that “this will not have any material impact to the UK’s economy” • Kept on working in this space – after all, it is really cryptography CONFIDENTIAL 2009 2014 Mainstream • A lot of talk about what we can do with the Bitcoin underlying technology • Ethereum concept • Ripple, Stellar, xCoins etc • ”Blockchain” name became popular 2015 Started Remitt • Wasn’t happy that things are progressing in silos • Came up with the concept and architecture of Interoperability and Governance • Started talking about identifying use cases – NSW Health for electronic records and data sharing 2016 ISO • February – Blogged. Started drafting the idea and proposal with Standards Australia • Pushed to get people behind it. “Too early”, “Stifle innovation”, “Why??” • October – ISO Approval J • August – Moved back to London – Finance/Fintech capital of the world to get behind this.
  4. 4. 4 HistoryBSI • First week met with BSI to get things started in the UK (August) • Learned that Standards were attempted before in 2015, but didn’t take off. Focused on consumer protection CONFIDENTIAL 2016 • Elected Chair of the UK’s National Committee for Distributed Ledger Technology DLT/1 • November – 1st Meeting of DLT/1 potential stakeholders 2017 Quant Overledger • Research • Product Development 2018 Token Offering • January 2018
  5. 5. 5 2016 Need for Blockchain ISO Standards CONFIDENTIAL Blockchain: Standards Wanted Long reliant on collaborative standard-setting, the financial industry looks for more of the same to realize the operational and risk-mitigation potential of blockchain - GARP – Global Association of Risk Professionals 8 April 2016 China creates blockchain coalition ChinaLedger Union The country’s blockchain industry organises distributed ledger- based coalition in Beijing supported by Chinese National Assembly and aiming to standardise the application of blockchain. - 20 April 2016
  6. 6. 6 Background Gilbert Verdian - 20 years working in Cybersecurity across Government & FS - HM Treasury, Dpt Health, EY, MoJ, CSC, HSBC 2009 – Introduced UK Gov to Bitcoin and Blockchain. Did economic policy assessment. 2015 – Founded Remitt/Quant to focus on blockchain for enterprise and Gov April 2016 – Submitted ISO Blockchain proposal through Standards Australia October 2016 – Proposal accepted Sassoon Grigorian - 20 years in Government policy and tech companies - Microsoft, Paypal, Salesforce
  7. 7. 7 2016 Need for Blockchain ISO Standards Blockchain: Standards Wanted Long reliant on collaborative standard-setting, the financial industry looks for more of the same to realize the operational and risk- mitigation potential of blockchain - GARP – Global Association of Risk Professionals 8 April 2016 China creates blockchain coalition ChinaLedger Union The country’s blockchain industry organises distributed ledger- based coalition in Beijing supported by Chinese National Assembly and aiming to standardise the application of blockchain. - 20 April 2016 Russian Finance Firms Form Blockchain Consortium A group of Russian banks and financial services companies has formed a private-sector consortium focused on blockchain applications. - Coindesk 1 July 2016
  8. 8. 8 Blockchain ISO Standard There are currently a number of different blockchain protocols in use. The technical committee will consider key protocol differentiating elements including permission models (private and public), smart contracts (contracts whose terms are recorded in computer language rather than legal language), application programming interfaces and other elements. The proposed work is to: • define this standard • create the mechanism to be a gateway to multiple blockchains • create the governance framework • have interoperability and compatibility with existing financial standards • provide legal and regulatory compliance to each transaction across blockchains • work towards a regulatory framework that provides a mix of legal and technical rules Proposed ISO Standard Involved the regulators and Government – RBA, ASIC, NSW Gov, Data61
  9. 9. 9 Blockchain ISO Standard (cont’d) To achieve these objectives, as a priority the work program would support the development of specific standards to address key areas such as: • Terminology – Having a common language and terminology to define the interoperability of blockchain • Process and Methods – the mechanism and messaging standards around inter-blockchain communication including routing. • Trust and Interoperability – Develop the standards that incorporate messaging protocols and methods to route, trust and connect to different blockchains. Establishing a standard API (Application Programming Interface) and set of routines and tools for building blockchain software and applications • Privacy and Security – Ensure the confidentiality, integrity and availability of users and entities are maintained. Embed compliance to money laundering and KYC (know your customer) requirements. • Authentication – ability to map blockchain transactions to individual users and entities in a secure manner. Store credentials on the blockchain or align/federate to a sidechain (off blockchain) Proposed Work Program Timeline 24-36 months
  10. 10. 10
  11. 11. 11 Scope of ISO work
  12. 12. 12 Opportunity in Government • Reduced cost of operations, including reducing fraud and error in payments • Greater transparency of transactions between government agencies and citizens • Greater financial inclusion of people currently on the fringes oft he financial system • Reduced costs of protecting citizens’ data while creating the possibility to share data between different entities, allowing for the creation of information marketplaces • Protection of critical infrastructure such as bridges,tunnels etc • Reduced market friction,making it easier for small and medium-sized enterprises (SMEs) to interact with local and national authorities • Promotion of innovation and economic growth possibilities for SMEs • This very broad range of possible benefits are delivered through the application of DLTs in three different ways: • Within currency applications • To manage contracts and create new forms of contracts • To prompt new applications by third parties, and provide more efficient ways of structuring and carrying out activities https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/492972/gs-16-1- distributed-ledger-technology.pdf UK Government Office for Science
  13. 13. 13 1: Establishing Blockchain standards will position ISO as a leading contributor to develop global solutions to facilitate data movement and information flows thus enabling more efficient and timely transactions. 2: There is no one blockchain standard or protocol currently in use. International standards will allow for interoperability and implementation and use of multiple blockchain related protocols. 3: The development of blockchain and electronic ledger standards through ISO will assist this new emerging technology to be rolled out and deployed with greater clarity, certainty and market confidence. 4: The widespread adoption and use of international blockchain standards could facilitate a new wave of innovation, productivity, employment and industry opportunities. 5: The possibility of contributing to making the provision of public and private services more cost effective and efficient. 6: The growing burden of KYC compliance could be significantly reduced through the development of international blockchain standards which utilize shared database(s) for undertaking business and transacting payments. 7: Blockchain has the potential to create significant benefits for developing countries by unlocking banking and other applications. For instance, realtime transfers of remittances can deliver financial independence for individuals in developing economies. Similarly blockchain can document land titles and owner registrations. 8: The development of international standards to support smart contracts has the potential decrease contracting, compliance and enforcement provision costs. 9: The development of international blockchain standards will reduce transaction costs for Justification
  14. 14. 14 1: efficient 2: interoperability 3: emerging technology 4: innovation 5: cost effective 6: KYC compliance 7: developing countries 8: compliance and enforcement 9: transaction costs Justification
  15. 15. Sydney Plenary – April 2017
  16. 16. Outcomes of Plenary • WG1 Terminology • SG 1 Reference Architecture, taxonomy and ontology • SG 2 Use Cases • SG 3 Security and Privacy • SG 4 Identity • SG 5 Smart Contracts • TC307 2nd meeting in Tokyo – Nov 2017 • TC307 3rd meeting in London – May 2018
  17. 17. Roadmap ISO Development TC307 – 24-36 months April 17 April 18 April 19 April 20 Terminology WG Tax/Reference Arch SG Identity SG Interoperability SG Governance SG Security & Privacy SG Nov 17 Terminology Ballot Taxonomy & Reference Arch WG Security & Privacy WG Governance WG Identity WG Sydney Tokyo London Use Cases SG Smart Contracts SG Smart Contracts WG
  18. 18. • The type of standards needed varies according to maturity of technology, nature of technology and industry sector • Standards should be considered in technology roadmapping and procurement O’Sullivan and Brévignon-Dodin, Role of Standardisation in support of Emerging Technologies, Institute for Manufacturing, University of Cambridge The right standard at the right time
  19. 19. Questions - 1 • Which area of the Standard are you most concerned about? • A) Terminology • B) Reference Architecture, taxonomy and ontology • C) Use Cases • D) Security and Privacy • E) Identity • F) Smart Contracts
  20. 20. Questions - 2 • Which area of the Standard are you most supportive? • A) Terminology • B) Reference Architecture, taxonomy and ontology • C) Use Cases • D) Security and Privacy • E) Identity • F) Smart Contracts
  21. 21. Questions - 3 • Which area of the Standard are do you think will be the most challenging to solve? • A) Terminology • B) Reference Architecture, taxonomy and ontology • C) Use Cases • D) Security and Privacy • E) Identity • F) Smart Contracts
  22. 22. Questions - 4 • Which area(s) of Blockchain/DLT do you think the scope of the Standard is not covering?
  23. 23. Conclusions and next steps • Continue the TC307 Roadmap • Continue meetings in Tokyo (Nov 17) and London (May 18) • Complete dependent work streams • Terminology • Reference Architecture, Taxonomy and Ontology • Publish first drafts in Q4 2018

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