Everything you've been told about blockchains is wrong: the "killer app" isn't any particular implementation, but the database design itself. In this presentation I explain how the permissioned blockchain design pioneered by Eris Industries actually addresses the problems and use-cases everyone's said blockchains can solve, but hasn't actually used them to solve. Hint: it's not because of "decentralisation."

1. Private and confidential. Images and text (where applicable) copyright Eris Industries Limited, 2015.
“It’s just software.”
ERIS
The Distributed Application Platform

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What?
We have built a software platform that will allow developers to solve
difficult commercial and governance problems
using blockchain, distributed computing and smart contract systems.

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Why?
Because automation of industrial processes is a primary driver of
human progress.
Secure automation of data management is overdue.
We build the tools to help developers solve these problems.

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How?
Most people look at blockchains like this
“Can have it in any colour you like, as long as it’s black”
-Henry Ford

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We look at them like this
See what we did there?

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Commercial thinking demands
Accountability.
Controllability.
Repeatability.
Reversibility.

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What this means in practice
A blockchain IS NOT:
Magical.
An internet money machine.
A blockchain IS:
A database.
Software.

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What Bitcoin etc. doesn’t want you to hear
A blockchain WILL:
Do exactly what we tell it to do, no more, no less.
THEREFORE:
You can use a blockchain and explore its potential in your organisation
without needing to use any existing or proposed cryptocurrency
network.
Without paying anything to anyone.

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Wait, what? B-but, “decentralization,” “new paradigm…”!?!
To be perfectly frank
It’s bulls**t
(Ok, that’s a little strong, but I have a flair for the dramatic)
(Let’s just say it is for the foreseeable future)

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HOW THE INTERNET CURRENTLY WORKS

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When you interweb, the work is done by somebody else

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Peer-to-peer architecture, as you know, is different

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Blockchains are more different still

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An explanation in English
Blockchains are:
1) distributed rulebooks
2) that track changes made to them
3) where write permissions are
controlled by public-private key
cryptography
and
4) as a result, knowledge of the rules
does NOT give someone the ability to
change them
(Sort of like French law
actually)

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A BLOCKCHAIN DATABASE’S
THREE CARDINAL RULES
TELL ‘EM WHAT YOU’RE GONNA SAY
SAY IT
TELL ‘EM WHAT YOU SAID

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RULE 1: TELL ‘EM WHAT YOU’RE GONNA SAY
Also known as the “transaction
protocol”
Effectively: users’ rules of the game
Who can broadcast transactions?
What can they “spend?”
How do they go about “spending” it?

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RULE 2: SAY IT
Also known as the “networking
protocol”
Open standard for common
communication to achieve a common
goal
What can we say?
What do words mean?
To whom can we say it?

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RULE 3: TELL ‘EM WHAT YOU SAID
Also known as the “consensus
protocol”
Agreeing the truth
What has been said?
Who has said it?
Is the record correct?
“The dragon that eats its own tail:”
what has happened (past) determines
what can happen (now and future)

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PUT IT ALL TOGETHER
="
Mais,!c’est!en!français…"

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A SHORT COMMERCIAL NOTE
Just as drawing a line through s. 177 of the Companies Act in an
statute book doesn’t change the law, having a copy of the
rulebook does not give you the ability to change it beyond the
scope of your permissions.
This means new people can get copies of the rules of a system
- and play by them - just by knowing what the rules are.
Blockchains == data infrastructure without fixed infrastructure.

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TRANSLATE IT INTO ENGLISH

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Hey, presto.
That’s a blockchain application.

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WHY THE ENTIRE WORLD THINKS BITCOIN (etc.) IS SPECIAL
CRYPTOCURRENCY RULE 1
Open to all
Evades government controls
CRYPTOCURRENCY RULE 2
Distributed architecture = resilient to interference/
destruction
CRYPTOCURRENCY RULE 3
Relies on competitive “mining” and awards “Bitcoins” etc
Process is automatic, no central third party required
Fraud difficult (but not impossible)

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Futurist histrionics notwithstanding
Bitcoin doesn’t solve any particular
problem well
Unless you’re a libertarian
(Most people are not libertarians.)
(Disclaimer: I’m a libertarian, but not *that* kind of libertarian.)

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HOWEVER
Blockchain solutions can be engineered
that do

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DEFINE THE PROBLEM
Does this solve a problem I have?
TENDING TO YES:
Harmonising between separate software stacks
Simplifying multiple processes into single process
Timely verification is paramount (e.g. settlement)
Reducing supervision and oversight cost

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DEFINE THE PROBLEM (Cot’d)
Does this solve a problem I have?
TENDING TO NO:
Requires speed (blockchains are slow)
Requires heavy computation (blockchains are passive)
Is fully automatic anyway (order of magnitude improvement
harder to achieve; though blockchains could still be useful qua
secure open standard)

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Then, write appropriate rules.
MyChain Rule 1:
Must be controllable in every respect
All write permissions must be accessible through P/P key crypto
In 99.99% of cases in finance, cannot be open/fully public
MyChain Rule 2:
Cryptocurrency got this mostly right, tweak for system reqs
MyChain Rule 3:
Must be able to change any aspect of the system on command
Commercial standards of data security/certainty needed
Reversibility required
No “mining” to secure as this is pointless

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DESIGN YOUR APPLICATION

30. THEN COME TO MOMMA
(That’d be Eris Industries’ website)
STEP 1: GET THE TOOLS
Two commands:
Then two more:

31. STEP 2: ROLL THE CHAIN
And roll the chain (one command):
Write your rulebook:

32. STEP 3: DEPLOY YOUR DAPP
(one command)
Translate into English, etc.
In this case JavaScript.

33. Then do it again until you get it right
(Because you won’t on the first try)
(Because this is how software is meant to be built)
(Because you can roll as many b’chains as you want)

34. Private and confidential. Images and text (where applicable) copyright Eris Industries Limited, 2015.
Happy to answer questions!