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Forging a blockchain agencies can use



Besides examining agency spending and performance, the Government Accountability Office also has its eye on distributed ledger technologies.

GAO’s five-year strategic plan released in February identified blockchain and cryptocurrencies as technologies that have the ability “potentially transform” society.

Agencies considering using blockchain to improve government processes must develop policies and procedures that address risk, change management and training as part of their strategy, GAO Director of Financial Management and Assurance Asif Khan said. “Blockchain is so customizable and versatile so you need to clearly think through the needs in your environment,” he said at May 2 KPMG Future Ready Government event.

“We find people who are interested in blockchain because it is a buzzword,” Khan said. But with more experimentation and proofs of concept, “the word will get out as to how people can adopt blockchain within their own [agencies],” he said.

Agencies need risk-based policies and procedures for the blockchain projects.  For instance, Khan said, agencies must have a game plan for what happens if the ledger is hacked and the chain can no longer be accessed for a specific project.

Change management and training enter the picture when blockchain starts making processes more efficient and eliminating redundancies.  “Peoples’ roles are going to shift, so change management is necessary to show how [the project] will be implemented,” Khan said.  “Each person needs to be trained on what their roles are in the environment.”

GAO itself is interested in using blockchain to verify information at the source level for its reports, but the idea has not gone beyond the discussion phase, Kahn said.

The Treasury Department’s Bureau of Fiscal Service, however, already has seen benefits from a blockchain proof of concept that inventoried employees’ computers and phones.  However, it remains to be seen whether blockchain will be able to live up to the hype, said Craig Fischer, program manager for that agency’s Office of Financial Innovation and Transformation.

“The next step is [to] understand what this [type of project] means when it is moved to into an operational environment in the federal government,” Fischer said.  “When you have a network that spans and effects several agencies, it could be useful, but we need to determine what the architecture for that would look like.”


5 Top Car Makers Enter Field Trials for Automatic Blockchain Payments



A group of major automakers are about to hit the road with the first field testing of a blockchain-based vehicle identification network next month in the U.S.

As reported by Nikkei Asian Review, BMW, General Motors, Honda, Ford and Renault are working with the Mobility Open Blockchain Initiative (MOBI) on integrating the system to automatically make payments on typical commuting runs without the need for cash or credit and debit cards.

By assigning vehicles unique identities that store data such as ownership and histories on a blockchain, the industry initiative aims to remove the need for a human when settling tolls and parking fees.

Founded in May 2018 by multiple major car manufacturers, MOBI has been working to enable the sharing of road data between manufacturers, a step towards developing self-driving cars.

As Nikkei writes, participating vehicles would eventually be able to automatically pay expenses once plugged into other networks such as charging or refueling stations.

MOBI is also looking into incorporating cryptocurrencies. One such system involved compensating users in crypto for putting energy back into the power grid following an outage.

A number of automakers are looking at blockchain for facilitating processes such as payments and data sharing, especially for the not-so-distant future where automated vehicles have become the norm.

This summer, CoinDesk reported how Daimler – parent company of Mercedes-Benz – partnered with blockchain firm Riddle & Code to produce a hardware wallet for automobiles. Looking long term at solutions for self-driving vehicles and car-sharing platforms, the firms’ wallet would also create a cryptographic identity for vehicles.

Jaguar Land Rover too is looking at rewarding drivers in cryptocurrency in return for their data.


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South Korean Blockchain ID Service Raises $8 Million in Series A



ICONLOOP, a South Korean blockchain startup that provides digital identification services, received its first venture capital investment through an $8 million Series A funding round, the company said.

ICONLOOP is a subsidiary of DAYLI Financial Group, one of the largest fintech companies in Asia. The financing round was led by the quasi-government agency Korea Technology Finance Corporation (KOTEC). Another six investment companies, including T.S. Investment, also backed ICONLOOP in this round.

Proceeds will be used to launch its digital identification service “my-ID” and expand a group of expected clients called my-ID Alliance, which currently consists of 27 companies.

That client group has a range of companies and organizations including banks, security firms, e-commerce companies and manufacturing companies.

The service will be launched during the first half of 2020 for commercialized uses, the company said.

Founded in 2016, the fintech firm initially designed an ID service based on blockchain technology for non-face-to-face openings of banking accounts, the company said in June.

The South Korean financial regulator, the Financial Services Commission, included the firm’s my-ID’ service into the ‘Innovative Financial Services and Regulations Sandbox.

A KOTEC spokesperson said:

“The blockchain technology is evolving into practical applications such as decentralized ID services in line with the global trend giving users back the personal data sovereignty.”

Another ICONLOOP’s flagship project is the ICON public blockchain network that uses the loopchain protocol to connect different blockchains. The project is supported by ICON Foundation, which held an initial coin offering for ICX. The coin was the 58th largest cryptocurrency by market capitalization as of Oct.11, according to CoinMarketCap.


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Blockchain Is on the Way, But Adoption Is Slow



Given that blockchain technology first emerged ten years ago, Gartner’s recent finding that the business impact of blockchain will be transformational in five to ten years is surprising. Blockchain, especially over the past 12 months, has become a business buzzword and everyone is looking for the best way to apply it.

However, according to the 2019 Gartner Hype Cycle for Blockchain it will be five to ten years before the technology becomes transformational in most industries.

The Hype Cycle provides an overview of how blockchain capabilities are evolving from a business perspective and maturity across different industries. Based on the findings of the Gartner 2019 CIO Agenda Survey (registration required), the hype cycle shows three industries that Gartner believes will move to adoption.

1. Banking and Investment Services

Nearly 18 percent of banking and investment services CIOs said they have adopted or will adopt some form of blockchain technology within the next 12 months and nearly another 15 percent within two years.

Related Article: What Blockchain Companies Need To Do To Succeed

2. Gaming

In the fast-growing e-sport industry, blockchain natives are launching solutions that allow users to create their own tokens to support the design of competition as well as to enable trading of virtual goods.

3. Retail

Blockchain is being considered for “track and trace” services, counterfeit prevention, inventory management and auditing, any of which could be used to improve product quality or food safety, for example.

Five Year Enterprise Roll-Out

Jimmy Nguyen, the president of the Bitcoin Association, told CMSWire that the five-to-ten year assessment is an accurate one though he believes that some practical blockchain technologies could take-off in the next two-to-three years.

Bitcoin and blockchain technology should be much farther along now, he told CMSWire.  However, bitcoin and the entire industry were artificially crippled for too many years because Bitcoin would not raise its tiny 1MB block cap. That prevented bitcoin from growing earlier to support global adoption for payment transactions and for enterprise blockchain applications.

The artificial 1MB limit on Bitcoin also led other competing blockchain projects to emerge, and helped create today’s world where we may have far too many competing blockchain, distributed ledger and cryptocurrency projects.

He pointed out that Bitcoin always had the capacity to be the one global data ledger and to power all the other advanced functions people want from blockchain — smart contracts, tokens, decentralized apps, and much more. Had BTC scaled to bigger blocks much earlier on its life, blockchain technology would be much farther along than it is now.

The result is that enterprises are still struggling to find a blockchain that fits their needs, especially from a scaling perspective. Ethereum’s struggles to scale demonstrate that, with Vitalik Buterin, the creator of Ethereum
recently acknowledging that the Ethereum blockchain is almost full and a fact that is inhibiting on-boarded of new businesses onto its network.

The entire blockchain industry has years of catching up to do, he added. CIOs of big businesses need a blockchain that has significant data and transaction capacity, and provides a stable protocol so they can reliably build their projects on it.

These are the reasons why Bitcoin SV (BSV) emerged. BSV is now powering a massively scaled blockchain — with 2000 MB block cap now and an unlimited block cap next February 2020 — to provide data capacity to be the public blockchain needed to support enterprise applications.

“On BSV, we are already seeing an explosion of exciting new applications being built, so expect to see enterprise use of the BSV blockchain in the next few years,” he said.

Related Article: What’s Holding Blockchain Back?

Blockchain Development

Blockchain growth has moved way past the era of hype and bitcoin bubble. So far, 2019 has allowed for projects to focus on blockchain development with many creative and innovative techs springing up in the blockchain ecosystem, Awosika Israel Ayodeji, enterprise solutions lead at Caymans-based Hydro Labs said.

Enterprise blockchain is gradually gaining attention with the likes of IBM, Consensys and Hydro Labs offering blockchain solutions to companies globally. Considering that many still see blockchain as new tech and so many are still learning to separate blockchain from cryptocurrency, it could take a while for blockchain to be fully adopted in the enterprise circle. “Companies do not want to be the first to explore the new tech and those already exploring are still in testing phase to ensure that the tech sync well with their systems and operations,” he said.

He pointed to a forecast by Deep Analysis that put enterprise blockchain full adoption at 2024, making the five year timeline for blockchain mainstream adoption by Gartner valid

Still More Problems

Dr. Michael Yuan, founder of a new decentralized marketplace OpenBay  and CEO of Second State told us that these are not the only problems for enterprise blockchain projects. There are three principle issues:

1. Incorporating Blockchain

Incorporating blockchain technology into businesses and industries is a significant investment, requiring substantial time, money and effort. In addition to the still significant amount of institutional resistance, he said, “there are operational and technical challenges that have inhibited mainstream adoption of blockchain technology

2. Standardized Middleware

For developers to create usable distributed applications, there needs to be a viable blockchain protocol to support “smart business contracts.” Such a protocol must include not only a virtual machine, but also a middleware software stack outside of the blockchain. (Today this is handled by so-called “DApps in a non-standard way.) While running the blockchain ledger, every node in the blockchain can support standardized middleware.

3. Reusable Software

As with successful enterprise software, the key is not to create an all-powerful virtual machine or programming language, but to build an extensive library of reusable software components — and then standardize the whole stack. Take the Linux operating system, for example. It was widely adopted by enterprise users only after the community had extended the core operating system with thousands of business-friendly software packages (and after Fedora/Red Hat came along to standardize the stack). The strengths of enterprise platforms lie in their standardized libraries and frameworks.

Cosmos, the network that was designed to improve blockchain interoperability, released its live software earlier this year. “Is that the breakthrough? It’s too soon to say, but crucial in a high-performance environment, where computing power and network latency are typically not a concern, is the design for reliability and interoperability in enterprise applications. It’s why blockchain already is moving from just another IT function to a true ecosystem builder — not if, but when,” he said.

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