For many people, when they hear about blockchain or distributed ledgers, their response is less about how these technologies work and more about “so what can this technology do for me”?
Although it is a valid question, it doesn’t mean that we say, “I’m going to be using the TCP/IP protocol today” but we are all very happy to go online and order books from Amazon’s website, so, most probably the future users of blockchains and distributed ledgers will probably never know they are using them at all.
Behind the scenes, however, within the industry, the variety of different blockchains and distributed systems on the market is expanding. The consensus mechanisms now being used can broadly be grouped into 3 different categories:
Proof of Work Blockchains (Bitcoin, Ethereum etc.), Leader-based Systems (Hyperledger Fabric, R3 Corda, Quorum etc.), and Economy-based (Casper, EOS etc.), also known as Proof of Stake. They also include so-called “next generation” distributed ledgers or (just to confuse matters) ‘blockless blockchains’ like Hedera Hashgraph and IOTA, which are based on something known as a directed acyclic graph or DAG.
At its formal launch in New York City this month, Hedera Hashgraph’s co-founders announced a set of performance metrics that make the platform particularly suited to certain use cases – and which appear to give the technology advantages over other distributed systems currently in the marketplace.
As CEO Mance Harmon explained to me in a recent interview conducted at a blockchain conference in Bangkok that “there are certain markets that spring to mind where fairness of transaction ordering is critical – we can think of the need to match bids and asks in financial services, or online gaming where what happens in order of time, – such as which party wins a fight in a multiplayer online battle arena game – is central”.
In fact, one of the platform’s first projects to be announced – and which is now expanding – was with CULedger, a US-based credit union consortium which selected the hashgraph technology as a key component of its permission, distributed, shared ledger platform. CULedger will now also use the Hedera hashgraph public ledger to enable cross-border payments across the globe.
Many people have proposed the use of existing blockchains for identity applications. However, there are several issues with the technology that are still being resolved. Hedera’s Founder, Leemon Baird, thinks his technology has an alternative approach. Since hashgraph’s private ledger works on an asynchronous process, unlike other blockchains like Bitcoin which rely on proofof-work, it could provide a ledger of citizen information – for example, a government ‘blockchain ID’ that would be cheaper and faster to access. This kind of identification could be used to ensure free and fair voting, and reduce both real and perceived voter fraud, by providing an immutable ledger of who voted and when.
Other aspects of government and public services may provide further use cases for distributed ledgers. Healthcare is one area being disrupted by the technology in a variety of ways – especially by reducing the enormous amounts of paperwork and bureaucracy created by healthcare system data. Making sure that medical professionals’ paperwork is compliant with healthcare regulations creates huge amounts of administrative work for hospitals as well as a hassle for doctors and nurses who just want to get on with their jobs.
Advances in distributed ledger technology can eliminate this paperwork while automating compliance reporting. Intiva Health’s platform ensures that licensed medical professionals can store and control access to credentialing documents in one place. Intiva recently said that it is building the next generation of its technology on top of the hashgraph distributed ledger technology. This could lead to the healthcare industry’s first dedicated careers platform which would handle the ongoing credentialing of doctors, nurses and other healthcare professionals. The hashgraph platform was apparently chosen because it was viewed as being the only one that could meet the stringent security requirements for personal data required by the healthcare sector.
But uses cases are not limited to the public sector. They also extend to other walks of life, including the creative industries. At the SXSW festival this week, an unlikely DLT advocate in the form of Matt Sorum – former member of bands Guns N’ Roses and Velvet Revolver – will be discussing his project, Artbit, a live concert hosting platform and payment solution for artists and creators, built on top of hashgraph.
His aim is to cut out the middleman and secure direct payment for artists via a cryptocurrency wallet. Budding artists will be able to post their music and host live performances on the site, where fans can watch and engage with them. Artbit says it will also use some form of gamification and augmented reality. There will be a cryptocurrency involved, but it is not providing further details of the ICO just yet.
Artbit is aimed at all sorts of creators, not just musicians. People like Shepard Fairey, the artist perhaps best known for his HOPE poster depicting Barack Obama, who is another famous adviser to the project.
And just to finish by blowing your mind, what happens when next-generation blockchains combine or converge with artificial intelligence? In New York, a company called MZ (formerly Machine Zone) announced it is using the Hedera. Readers may need to pause to let the implications of the hashgraph platform in its Satori project – to create the “world’s decentralized AI mesh” – sink in. What does that mean? It merely combines decentralized computing with access to the Internet of Things everywhere always in real time!
The Hedera hashgraph platform has gained a large community and followers already, but for those still starting to learn about blockchain, the concept of so-called next-generation protocols is still a new one. Follow up questions remain about the real-world testing of the platform and close watchers are waiting for more details about the launch of the Hedera cryptocurrency and further information about the consortium mechanism by which the platform will be governed.
CEO Mance Harmon described the new Hedera logo this week as the H-bar. If the technology can indeed rise to the challenges of speeding up and scaling distributed ledgers to meet the requirements of financial institutions, governments, and other global companies which rely on high throughput to make their systems work, it seems like the possibilities of “raising the H-bar” could be significant. The future of distributed consensus mechanisms just got even more interesting.
Helen Disney is CEO of Unblocked Events and an advisory board member of the Distributed Ledger Foundation, which recently received a grant from the Hedera Hashgraph Council to fund its first project, The Free and Fair Voting Initiative.