Use Cases Sander van Loosbroek, Founder Cegeka DLT MARCH 28 TH , - - PowerPoint PPT Presentation

Blockchain Introduction & Use Cases

Sander van Loosbroek, Founder Cegeka DLT

MARCH 28TH, 2019

• Father, Cyclist, Founder Cegeka DLT
• Vocational degree electronics, IT Bachelor,

MBA

• Founded 2 companies
• Wrote thesis about the impact of

blockchain on the financial industry at Nyenrode(2014)

• 4 years of experience applying blockchainin

real world business cases

Introduction

5~15 core team members Technology-agnostic, multi-project experienced team Real experience with Ethereum, Hyperledger Fabric, Corda and others Founded in 2015

About us

DLT Services

• A shared, distributed ledger that is secured

by cryptography

• Computers in a network, called nodes,

process and store transactions

• A blockchain network can span the globe

and predictably reconcile transactions

• No central authority governs the network

What is blockchain?

• All transactions are appended to the

ledger and cryptograpically chained

• If you want to change 1 transaction

you’ll have to rewrite history

• Built on existing “proven”

technologies that you all use today

Whyis it secure?

Whydo we want this? 1/2

Website Email

The internet was designed to copy data reliably between nodes

Whydo we want this? 2/2

Transferring data (from party X to party Y) is not possible on the internet

And thisis today’sworkaround

Third Parties facilitate value transfer on your behalf

There’s more than 1 “type” of blockchain

And thusthereis more than 1 “kind”

ADDITIONAL SLIDE DECK The $ 1 mio question

Will this technology disrupt your business model?

• change how you collaborate with your customers, suppliers and partners?

How do you decide what to do?

• “Wait and see” or become an innovation leader in your industry?

A quickexercise: Whyblockchain?

https://medium.com/coinmonks/blockchain-101-4acc9902b3a4

1. Notarization: To prove thatsomething “was” at a point in time 2. Ownership: To transfer in real time 3. Sovereign identity: To prove that I am whoI say I am 4. Smart contracting: Todigitallyexecutean agreement in mutualconsent 5. Triple entry accounting: To prove that2+n partiesbothexecutedfaithfully

5 areas where blockchain willmake a difference

Blockchain Notariz ation Owner ship

Sovereign Identity Smart Contracting Triple Entry Accounting

• Verify the existence of a document

and its status (current/outdated)

• Built on Ethereum, runs in a

private permissioned environment

• 1. NotarizationUse Case

Manyothersavailable

Thoughts?

• Is this disruptive?
• might be for these guys →
• What’s the point of using such a service?

• Paper-based process dating back

100+ years

• Doesn’t fit todays need for digital-

first

• Copiers, faxes and the internet

didn’t change it, neither will blockchain

• 2. Ownership: Blockchain in the worldof trade

A rethinking example

Source: blog.zuehlke.com/en/how-the-blockchain-can-disrupt-trade-finance/

Blockchain is a driver fordesigningnewTF products

Token Customer/Shipper/Warehouse/B ank/Supplier/Buyer Title document

X

Customer Bank

A new Bill of Lading

Unique global transaction Low txn cost Exact time Tokens = goods Readable for humans & machines

Thoughts?

• Existing Trade Finance instruments de-risk financing thanks to

jurisprudence

• Blockchain is not a simple “plug-in” for these instruments

– Leveraging blockchain most likely re-creates risks

• Blockchain can drive huge process efficienties and de-risk trade financing

where such risks currently exist

– Think tier 3,4 and 5 customers. Who doesn’t trust i.e. Shell? ☺

• There is no value for blockchain in the existing processes

• The report considers a wholesale CBDC (for use in

financial markets), and a general purpose CBDC (for use by the general public) and their implications for payments, monetary policy and financial stability.

• It finds that wholesale CBDCs might be useful for

payments but more work is needed to assess the full

• potential. Although a CBDC would not alter the basic

mechanics of monetary policy implementation, its transmission could be affected.

And… digital cash ofcourse

https://www.bis.org/cpmi/publ/d174.pdf

A different kind of logic

• IfCentral Banks were to create a digital form of money thatyou could hold yourself…
• Under what conditionswould you give your savingsto a retail bank?

Is thisworth it? (remember 2008 crisis and bail-out costs)

https://www.ecb.europa.eu/stats/policy_and_exchange_rates/key_ecb_interest_rates/ht ml/index.en.html https://thebanks.eu/compare-banking-products/savings- accounts/Netherlands

Central bank vs Retail bank interest

• The concept of

identities is changing

• New standard

developed by DIF

– In use today in Zug

• 3. Sovereign identities

https://medium.com/uport/next-generation-uport-identity-app-released-59bbc32a83a0

And itsused tovote (capitalmarkets onlyfornow)

• KYC, AML, WwFT, … verifying an ID is

essential for any online solution but…

• Knowing who did what in the past will

prove to be far more valuable & reliable than KYC

• But feel free to KYC ID’s for now ☺

Blockchainis fixing problems you didn’t know/care about

• “Blockchain technology, most famously associated with

the crypto-currency Bitcoin, offers unique opportunities for humanitarian agencies to provide the best-possible assistance to vulnerable people around the world,” the WFP said at the time.

• Within months, the WFP ran a full pilot in the Jordanian

refugee camp of Azraqto successfully facilitate cash transfers for over 10,000 Syrian refugees on its blockchain payments platform. The pilot alone is said to save the agency $150,000 a month while eliminating a staggering 98% of bank-related transfer fees, according to Munich WFP innovation lab chief Bernhard Kowatsch.

If I knowwhoyouare…

• 4. Smart contracting
• Thisis whatyouhave. Nowwhat?
• Nick Szabohypothesizedthesolution tothisproblemin 1994 as follows: “A smart contract is a computerized transaction protocol that executes

the terms of a contract”. There just wasn’t any technology available to do this.

No disputesif you’relucky☺

• Executing contracts digitally is hard, as

every party does their own calculations

• These results need to be reconciled,

resulting in discrepancies

• Examples: Open book contracts

(common in logistics, music royalties)

• Now: Done by 3rd parties such as

“Achieve Low-Risk Freight Audit at any Volume, from any Region, in any Mode.”

Smart contractingapplied

Royalty Ledger is GuildOne’s Corda-based blockchain solution that brings the trust, efficiency and security of distributed ledgers and smart contracts to oil and gas royalty transactions. a business process engine w ritten entirely in Solidity sm art contract language as w ell as a high-level RESTful API.

Shippingparcelstoday

Postal 3rd party GOV.CN

SKU request SKU request SKU =￥ SKU =￥ SKU List SKU List SKU List

∆t

SKU DDP t0 SK SKU DDP DDP t1

DDU t1 > DDU t0 Freight + DDP Sur Surcharge Sur Surcharge Col Collect

Customer Shipment Customs China

Whycustomsis interested

3rd party 3rd party GOV.CN

∆t

SKU DDP t0 SK SKU DDP DDP t0

Freight + DDP

LTN Common SKU List

LTN + SK SKU DDP DDP t0 SKU Set =￥ SKU Query SKU request SKU request

Customer Shipment Customs China

And whereblockchain makes a difference

What was first: The duty change or the parcel shipment?

Tracking # [X%]

Duty X% → Y% GOV.CN

Tracking # [X%] Tracking # [Y%] Tracking # [X%]

Duty X% → Y% GOV.CN

Tracking # [Y%]

To store a signed receipt of your counterparty toacknowlegde a transaction you need to: 1. Strong Psuedonymity, At Least 2. Entry Signing 3. Message Passing 4. Entry Enlargement and Migration 5. Local Entry Storage and Reports 6. Integrated Hard Payments 7. Integrated Application-Level Messaging

Triple Entry Bookkeeping

“The receipt is the transaction”

• “If a financial system was to be

designed as such that there would be no need to reconcile, would there be a need to audit its integrity?”

Challengingthe need foraudit

Wrapping things up…

Or are we just getting started?

What willbe a game-changingsolution?

• 9 banks, 29.991 to go?
• Scalability is key
• Building a closed platform != blockchain
• Building what you can already do…
• Think 5 years & strategy, don’t try to solve today’s problems

Andhowwillthenew worldwideweb actuallywork?

• DAML → The first smart contract with the

concept of privacy modelled in → CEO+n left

• NEW:Samsung Unveils Cryptocurrency

Wallet, Dappsfor Galaxy S10 Phone

• Proof of Stake →Part of the next Ethereum √
• SGX TrustedComputing → PoET anyone?
• EY Ops Chain Public Edition (PE) with Zero-

Knowledge Proofs →No further updates

• NEW: Marshall Islands to Launch ‘Sovereign’

(SOV) Digital Currency as Legal Tender

“Just in” -- UpdatedMarch2019

• Blockchain is maturingslowly, most “ideas” are nota

goodfit withthe technology

• Most projectsare nottaking off (seeprevious

example) or turn out tobemore complicatedthan theproblemtheywant tosolve

• Thistechmightor mightnotdisruptyourcompany,

look online notonlyforusecases but forProof-of- Concept outcomes. No outcomeusuallymeans…

• There are excellent guides out there todaylike

https://blockgeeks.com/

How youcouldget started

https://www.coindesk.com/debate-factom-land-title-honduras

Or juist buildyourownPOC in a week

https://github.com/cegeka/hyperledger-poc-quickstart

• You don’t learn by looking, you learn by doing
• No harm in learning FAST ☺ using our proven tools
• Build small tests to understand what’s the game changer

→ This is what your organization needs (not necessarily what they’ll ask ☺

What

• A set of deployment scripts to install a HyperLedger Fabric

blockchain + Angular frontend in a Docker container

How

• Design a blockchain network on https://composer-

playground.mybluemix.net/, our script will do the rest

• This included building your frontend!

Why

• Understanding how/if blockchain can help you should be as

fast and cheap as possible

Or use anyof the otehr greattools out there

• We’re also big fans of Ethereum, Microsoft built a great tool for that

blockchain here: https://azure.microsoft.com/nl-nl/features/blockchain- workbench/

• Don’t spend your time testing someone else’s code

W W W . C E G E K A . C O M

linkedin.com/in/svloosbroek/ @sander_vl sander.vanloosbroek@cegeka.com Universiteitslaan9 3500 Hasselt, België