Blockchain & Smart Contracts. Project Management tools in the 21 st Century

Transcription

1 1 Blockchain & Smart Contracts Project Management tools in the 21 st Century

2 Ancient Ledgers Early Transactional Trust 2

3 Modern Ledgers Still Basically the Same? 3

4 Current Information Systems 4 Lack of transparency Current systems are not open. Problems thrive due to hoarding of information. Centralised Transactions Transactions are centralised in select institutions, invisible to most people. Wastage Systems have lots of double handling and middle men. Lack of automation. Promotes errors. Ownership Funds held in institutions can be appropriated without consent Greece. Same with data. Fraud Lack of visibility and siloed information means fraud can go undetected and un-prevented. Trust Users must trust centralised entities to be truthful. Limited information makes verification difficult. Big contracts to mitigate risk.

5 Finance and Information Silos Just a Few of Many Today

6 Bitcoin The Genesis of Blockchain 6 A global ledger hosted by many nodes Blocks and Transactions Built-In Verification Incentives Distributed Ledger Transactions are broadcast to nodes, and nodes validate transactions, write them into permanent blocks. Blocks are just records of transactions. Once on the network, cannot be changed, ever. Public and private keys are encrypted which promote security. Signatures can be verified with algorithms. Anyone not playing by rules will be rejected by network. Entries are added to the ledger by miner nodes. Nodes compete to get a reward expending computing power. Incentives keep them competing and honest. Distributed nature offers security. The more nodes, the more secure. The longer the chain, the more nodes, the harder it is to attack. Ledger is auditable easy to pick up issues.

7 Bitcoin is a global financial ledger, where all transactions are verified, stored permanently and everyone has complete visibility.

8 The Bitcoin Network (Simplified)

9 Summary of a Traditional Public Blockchain A distributed, open database Stores transactions in permanent data blocks Many copies of ledger worldwide Allows online payments without a bank Harnesses the power of encryption Built on game theory and economic incentives Borderless and decentralised Immune (in most cases) to tampering Secured by maths One of the safest ways to store value (on the large networks) 11

10 If we can exchange value on a trustless global ledger, why stop at simple payments?

11 Ethereum & Smart Contracts 13 Ethereum A programmable blockchain for more than transactions User accounts and autonomous (contract) accounts A distributed, blockchain operating system Smart contracts applications on a blockchain Immutable, reliable and autonomous accounts Can be programmed to exchange information automatically (as opposed to manually ala Bitcoin) Parties can reliably automate relationships/transactions in agreed upon ways and have complete visibility

12 What does this mean? 14 Code & Finance Blockchain The level playing field where people can automate their transactional relationship If money is on an open platform without intermediaries then code can interact with that money without intermediaries. No banks, no paypal, no third-party API solutions just money and business logic. Visible and Consistent Smart contracts allow transactional code - programs which can listen for events on the blockchain and execute pre-determined actions, including sending transactions of their own. This means reliable, multiparty business logic with complete visibility.

13 Traditional (Passive) Relationship Smart Contract (Active) Relationship Q & A

14 Blockchain technology can provide a level playing field for parties where money and information is exchanged.

15 Smart contracts allow parties add code directly to this exchange, meaning certainty of behaviour and visibility to all involved.

16 A level online playing field 18 A shared record of truth not held by any one party A platform-native financial unit of exchange Blockchain: What do we get? Open information exchange viewable by everyone Automated auditability Code which can be programmed to act consistently Direct transactions between value producers and consumers The means to automate relationships, increase visibility and reduce the need for trust

17 How is Blockchain Being Used In Projects Today?

18 Food Supply Chains Walmart & Others 20

19 Port Management Rotterdam, NED 21

20 Distributed Power Puerto Rico 22

21 Blockchain Bonds World Bank and Commbank 23

22 Blockchain-Based Flight Insurance AXA 24

23 Not to mention 25

24 Public or Private?

25 Public Private 27

26 Public vs Private DLT Platforms 28 Public Blockchain Benefit of a large distributed ledger Wide development pool, updated automatically Security by decentralisation Wide applicability and inter-operability No need for trust from third parties Code and smart contracts are public Typically slower Rules set by consensus of entire blockchain More difficult to integrate current code Limited control over base blockchain Private Blockchain More granular control Can have private data You set the rules Generally faster Easier to run current applications and code Responsible for updates and security Harder for parties to participate Less secure more attractive for attack Lack of decentralisation A normal database may be better!

27 The Big Question: What am I wanting to achieve?

28 State of Distributed Ledger Technology 30 It s Still Early Railroad tracks and roads of blockchain are still being laid down Still waiting for many of the cars and trains to begin running Several enterprise contenders Several more about to launch Community adoption is happening gradually The examples are the early movers Not everything needs a blockchain Distributed database may suffice depends on your usecase Must resist the temptation to sprinkle a little blockchain on everything Along with AI, Blockchain may be the biggest digital innovation for business DLT is a trust layer for the internet Allows trustless, automated interactions Free flow of money and the building of business logic around it

29 When should I consider blockchain for projects? 31 Ask: 1. Are we conducting international transactions? 2. Do we have trust or visibility issues in our relationships (including with customers)? 3. Is there wastage, double handling or excessive administration in our monetary processes? 4. Where are we paying people to act as trust intermediaries? 5. Could we benefit from having code govern our agreements with other parties? 6. Do we have silos of information in our multi-party workflow? 7. Would we benefit from a level playing field or common source of truth in our project (especially if other parties are involved)? 8. Could we benefit from building an open, digital structure, especially if the project is global?

30 Decentralised Autonomous Organisations Traceability and Active Auditing Supply Chain Management Smart Legal Contracts Active Agreements Information and Risk Management Relationship Automation Transactional Reliability Smart Assets Registers and Ledgers Payments, Escrow and Funds Management Removing Intermediaries How Can DLT Be Used In Projects? 32

31 Where to Next? 33 Resources Podcasts (Software Engineering Daily, Epicenter, The FOMO Show) BlockSense website blocksense.com.au Meetups Blockchain for Business, Bitcoin & Blockchain Brisbane, Women in Blockchain, Cardano many other meetups Education and Training Workshops & Masterclasses Strategic Sessions Begin a small project Easiest way to tackle an obvious, but small usecases Get people familiar with the technology

32 Matthew Shearing 34 Blockchain Smart Contracts Law Risk & Security Services: Training & Workshops Consulting Advisory me: Podcast: The FOMO Show (fomo.show) blocksense.com.au Matthew Shearing and BlockSense, All rights reserved. block-sense.io

33 Q & A