This document provides an overview of blockchain technology including definitions, applications, and issues. It begins with definitions for blockchain, distributed ledger, and related concepts. Applications are discussed in both financial areas like bitcoin and ethereum, as well as non-financial uses in areas like IoT, healthcare records, and digital rights management. Technical issues addressed include scalability challenges and the debate around decentralization. A variety of industries are exploring blockchain including finance, government, and enterprise software through initiatives like Hyperledger.

1. Innovation Report:
Blockchain
Daniel Voignac • 08.2017

2. Overview
I. Definition
II. Issues
III. Applications
IV. Discussion

3. Motivation

4. Motivation
On the 17th of August a Tesla 3 would have
cost you 7.9 Bitcoin
In 2011 it would have cost you 17,500,000
Bitcoin

5. Motivation
Figure 1: Bitcoin/USD exchange rate,10 year period
(source: xe.com (date of access: 14/08/2017))
START

6. Motivation
● Nov 2008: Satoshi Nakamoto's “Bitcoin: A
Peer-to-peer Electronic Cash System”
white paper
● Byzantine generals problem
● Bitcoin’s badbuzz and goodbuzz
● The fifth evolution of internet

7. Motivation
Figure 1: Bitcoin/USD exchange rate,10 year period
(source: xe.com (date of access: 14/08/2017))
START

8. Motivation
Figure 1: Bitcoin/USD exchange rate, 1 week period
(source: poloniex.com (date of access: 14/08/2017))

9. Motivation
● http://www.blockchainfederation.org/ico/200-million-60-minutes
-filecoin-ico-rockets-record-amid-tech-issues/

10. I. Definition

11. The concept

12. The Concept
Block is
broadcast to
every party in
the network
Youssef
wants to send
Tanguy some
money
1st Block is
created online
and represents
the transaction
Those in the
network
approve the
transaction and
validate it
Block is added to the
chain which provides
permanent
nonrepudiable and
transparent record of
the transaction
Tanguy
receives the
money from
Youssef

13. Facts and Figures ( as of 17/08/17)
● Volume of Bitcoin (24h): $2,171,310,000
● Total size of Bitcoin Blockchain: 128789 MB
● Bitcoin Market Cap in USD: $73,338,186,368
● Ethereum Classic Market Cap in USD: $29,224,770,170

14. The concept
● Distributed Database
● Ledger
● Cryptography
● Consensus
● Token and Cryptocurrency
● Time Stamp
● DAO (Decentralised Autonomous Organisation)
Public
Permissioned
Private

15. The maths
● Proof of work (e.g. Hashcash for bitcoin)
● Merkle Tree
● Chain
● Hash
● Nonce
● Nodes
● Miners
● Network
Block
Chain
Network

16. Digital Record
● Transaction Number
● Address
● Size
● Block Number
● Date & Time

17. II. Issues

18. So what makes Blockchain so secure?
● Hash function enforces clear and thorough records
● Multiplicity of miners (5000+ for Bitcoin) and consensus
requirement
● Proof-of-work
● Protocol definition 1 MB max data per block
● Quantity of addresses ( 10⁴⁸ for Bitcoin while there are 10⁵⁰
atoms on constituting Earth)

19. DAO
● Decentralized Autonomous Organisation
● Transfer organisation to a blockchain and write all interactions
as smart contracts
● No intent, feelings or discrimination
● One owner:
○ decides on voters for protocol
○ determines given time for voting
● Creates need for KYC and AML rules

20. Finance
● Significantly increases speed of transaction by deleting
middleman and central authorities
● More efficient markets
● “Annual revenues earned by the banking system for processing
payments are huge, at $1.7 trillion, and rising” ¹
● Cross-Border Payments
● Insurance: Claims processing
● http://uk.businessinsider.com/santander-develops-blockchain-i
nternational-payment-app-with-ripple-2016-5
¹ https://www.economist.com/news/finance-and-economics/21694531-all-money-spent-technology-banking-not-efficient-high-tech-meets-low(date of access 03/08/17)

21. IoT “On the blockchain, nobody knows you’re
a fridge” Richard Brown
● Preventing connected objects from spoofing and other forms of
hacking
● US Homeland security reportedly working on designing
blockchain protocols for IoT
● Also includes:
○ Hospital system
○ Self-driving cars
○ Safety system
○ Many more

22. Smart Contracts
● Healthcare
● Music
● Intellectual Property
● Passports
● Birth, wedding and death certificates
● Personal ID
● Public Community (councils)

23. Ethical and regulatory issues
● How decentralised can a blockchain be to function in our
centralised regulated society?
● Example: intervention of Swiss jurists after the The DAO hack
● Towards government legal records secured on a blockchain
https://news.bitcoin.com/worlds-top-10-bitcoin-friendly-countries/
● The future of lawyers, notaries and lawmakers
https://itunes.apple.com/fr/podcast/la-blockchain-va-t-elle-r%C3%A9volutionner-le-droit/id1150055692?i=1000377215258&mt=2

24. Technical issues
● Required computer capacity - very powerful Miners
● Multiple data centers?
● Forks
● Number of users
● Installed protocol releases

25. III. Applications

26. Overview
A selection of…
- Financial
- Non-financial

27. Financial

28. Source : https://coinmarketcap.com/ (date of access: 28/08/2017)

29. Source : https://blog.coinbase.com/a-beginners-guide-to-ethereum-46dd486ceecf (date of access: 04/08/2017)
Bitcoin vs. Ethereum
Info from end of Feb 2017. What about today in terms of market cap?

30. Source : https://coinmarketcap.com/ (date of access: 04/08/2017)

31. Bitcoin
● Satoshi Nakamoto
● Digital Money
● Limits:
○ Max block size 1MB (~2000 transactions during the week) -
Average time between block gen. 10 minutes
○ Protocol less compliant to nation states than e.g. ethereum
Start mining @https://bitcoin.org/fr/telecharger or join a mining pool

32. Ethereum
● First described in 2013 by Vitalik Buterin
● Full protocol still to be released
● Smart Contracts
● New language: Solidity (e.g. here)
● Homestead → Metropolis → Serenity
● Proof-of-work → proof-of-stake (keeps inflation to zero)
● Cryptocurrency: Ether (a.k.a gas)

33. Ripple
● For moving and trading value globally
● Even works with two unlike assets and in non-liquid markets
● Low cost, very high security, record time
● Serves primarily financial institutions
● All about TRUST
● No proof-of-work

34. Factom
● Industry focused
● Factom Inc. builds tools and products on top of the protocol
● Integrates and bridges other blockchains thus improving its
security
● Smart contracts

35. Augur
● https://augur.net/
● Between financial and non-financial
● Users log in predictions on a blockchain
● Reward according to precision of prediction
● Big volume → average prediction is correct

36. NEO
● https://futurism.com/a-new-blockchain-platform-is-taking-on-e
thereum/

37. Non-Financial

38. Verisart
● App available on iOS
● 2 step art referencing
●

39. Filament
● Securing IoT data
● Hardware : Low power (4µA at sleep) nodes
● Software :
Source : https://filament.com/assets/downloads/Filament%20Security.pdf (date of access 04/08/17)

40. Colu App
● Creating very local currencies (Liverpool pound, East London
Pound, Tel-Aviv Jaffa shekel …)
● Boosting local economies and rewarding users
● UI QR code exchange from smartphone to smartphone

41. LaZooz
● Ride sharing app based on a blockchain reward system
● Fair share - fair fare
○ Like-minded people
○ Optimisation of car space
● Zooz mining app
○ Receive cryptocurrency by
■ driving
■ Making the community grow

42. Blockstack
● https://blockstack.org/
● “A new internet for decentralised apps”
● Add blockchain security to any internet app
● Dev kit available today (user on waiting list)
● Music, Health, Payments
● Available today:
○ Todo list
○ Single page server-free Javascript app
○ CLI intro

43. Blockverify
● http://www.blockverify.io/
● Anti-Counterfeit solution
● Gives a tag to each authentified product (whether authentic or
counterfeit)
● Blockchain traces the product
○ Pharmaceuticals
○ Luxury items
○ Diamonds
○ Electronics

44. Storj
● https://storj.io/
● “Blockchain based end-to-end encrypted, ditributed object
storage, where only you have access to your data”
●

45. HyperLedger
● A Linux Foundation initiative
●
Source: https://www.hyperledger.org/about

46. HyperLedger
● Five projects : Fabric, Iroha, Sawtooth, Burrow, Indy
● Fabric is the most used one for developing blockchain based
applications
● Open-source as everything from Linux
● Allows components such as consensus to be plug-and-play
Source: https://www.hyperledger.org/about

47. How about groups like AWS?
● AWS annouced partnership with Digital Currency Group (DCG)
in May 2016 to research on a possible intgration
● In turn, DCG announced in May 2017 DCG connect dcg.co
● Updates are coming in very fast
● Race to who is the quickest
● https://azure.microsoft.com/fr-fr/blog/the-microsoft-vision-for-
accelerating-enterprise-blockchain-development/

48. Microsoft Azure - Coco
● Latest Azure’s blockchain-related announcement
● Coco platform
●

49. Truster IoT Alliance
● https://www.trustediot.org
/
● New open source software
foundation

50. Enterprise Ethereum Alliance
Largest blockchain alliance

51. So how are nation states responding ?
● https://www.wired.com/2015/12/you-too-can-get-married-
on-the-blockchain/
● https://www.coindesk.com/russias-ministry-health-launchi
ng-blockchain-pilot/
● https://www.forbes.com/sites/elaineramirez/2017
/08/09/dayli-icon-blockchain-south-korea/#48bd3
40125a7
● https://futurism.com/congress-is-reportedly-drafting-a-bill-t
hat-will-mainstream-digital-currency/

52. IV. Discussion

53. Broad Topics
● ICOs
● IoT security
● Towards a suppression of notaries and lawyers?
● Many BC companies will advertise themselves as a gain of
efficiency in record keeping (e.g. asset transactions) thanks to
the decentralised property of BC. BUT this implies everyone
using the same platform

54. The DAO: rise and fall More info here (FR)
The mother of all DAOs
● Initiated by Slock.it an active community on the Ethereum blockchain
● Mid-May 2016 biggest crowdfunding in history 4 weeks over 120M$
● 17th June 50M$+ is hacked through a fault in open source code
● Ethereum community votes on a hard fork to save sunken boat and go
back to blocks before launch of The DAO
● Creation of ETH and ETC
● Fragile confidence in DAOs but still a promising field

55. Appendices

56. Merkle tree
By Azaghal - Own work, CC0,
https://commons.wikimedia.org/w/index.php?curid=18157888
Back to the maths

57. Types of network
Source: Blockchain for dummies
Back to
top

66. References and useful links

67. References
● T. Laurence (Co-founder of Factom), Blockchain for dummies,
Wiley, May 2017

68. Useful links - Top 5
● http://www.goldmansachs.com/our-thinking/pages/blockchain/
● https://medium.com/@DebrajG/how-the-byzantine-general-sac
ked-the-castle-a-look-into-blockchain-370fe637502c
● https://blog.cex.io/cryptonews/top-50-blockchain-startups-201
7-16158
● https://www.ethereum.org
● https://www.coindesk.com/information/what-is-ethereum/
● For chart lovers https://blockchain.info/fr/charts