Presentation "The Use of Bitcoin and Blockchain Technology in Public Sector" at Norstella's blockchain conference, 26.10.16

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The Use of Bitcoin and
Blockchain Technology in
Public Sector
Svein Ølnes, Vestlandsforsking
Norstella’s Blockchain Conference, 26.10.2016

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«Everybody» want a blockchain

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 Research institute (foundation), located in Sogndal (est. 1985)
 Research areas:
 Climate and environment
 Information technology
 Tourism
 25 researchers
 Part of the public research infrastructure in Norway
Western Norway Research Institute

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 Researcher at WNRI since 1996
 Main research topic: ICT in public sector
 Interested in Bitcoin/blockchain since 2011
 Bought my first bitcoins in 2011 (Mt. Gox!)
 .. and have followed the development in crypto currencies since then
 interested in the intersection of technology, economy and society
 Currently a student in the MSc program Digital Currencies at the
University of Nicosia
 have published papers on Bitcoin/blockchain use in public sector
 Disclaimer: own bitcoins og ether, have Bitcoin mining equipment
About me

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Statement
 Blockchain technology, and especially universal
and open blockchains like Bitcoin and Ethereum,
have a great potential for use in public sector

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Statement backed by paper
 Blockchain technology, and especially universal
and open blockchains like Bitcoin and Ethereum,
have a great potential for use in public sector
 «Beyond Bitcoin – Enabling Smart Government
Using the Bitcoin Blockchain»
 eGov 2016, Springer LNCS

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Open vs. closed blockchains
Open
(permissionless)
Closed
(permissioned)
Who can update Everybody with
enough resources
Selected people/org.
Who prod. data Everybody participat. Customers of org.
Incentive to follow rules Direct economic
(carrot & stick)
Reputation
Storing Distributed Centralized
Trust in central actors No Yes
Transaction costs - +
Speed (trans./sec.) - +
Immutability + -
Currency/»token» Yes No
Example Bitcoin, Ethereum HyperLedger

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What is genuine with (open) blockchains?
 Immutability
 «tamper proof» vs. «tamper evident»
 .. but not in itself (ref. Ethereum and The DAO)
 Censor-ship resistant
 «unwanted» transactions will also be processed as long as they
follow the consensus rules
 Open for all and at the same time protect privacy

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What public sector needs to think through
 Interoperability
 open vs. closed blockchains
 Platform/infrastructure for public sector
 from «common components» to common platform
 Clear parallells to the growth of Internet in the 1980s/1990s

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Bitcoin as a platform and information infrastructure
Bitcoin infrastructure (Network Services)
Blockchain, Consensus, Ordering, Hash storage, Security
Bitcoin currency
Colored coins
(Mastercoin,
Counterparty
++)
Sidechains
Payment
channels
(Lightning
Network..)
Smart
contracts

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Bitcoin and blockchain in public sector
 Authentication of documents
 badges, course certificates, CVs
 other certificates and licenses
 ++
 Proof of ownership
 property
 +++
 Economy
 transparency
 audit
 Think of Bitcoin/blockchain as a new Internet-based platform!

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Examples on the use of Bitcoin/blockchain
 Authentication of documents
 Course certificates from the University of Nicosia (digital currencies)
 MIT’s Blockcert is a suite for streamlining the work with certificates
and CVs on the Bitcoin blockchain
 Proof of ownership
 Sweden and many other countries are experimenting with property
registration on a blockchain
 What about Norway?
 Security and anti-spam
 machine-to-machine payments (as a safeguard against email spam,
DDOS attacks, new business models for media companies ++)
 Internet of Things (IoT) is difficult, or impossible, to scale without a
decentralized architecture. Blockchain tech. seems perfect.

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Relevante literature
 Nakamoto Satoshi: «Bitcoin - A Peer-to-Peer Electronic Cash
System» (bitcoin.org/en/bitcoin-paper)
 Andreas Antonopolous: «Mastering Bitcoin»
 Nathaniel Popper: «Digital Gold»

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Thanks for your attention!
e-mail: sol@vestforsk.no
This presentation:
http://www.slideshare.net/sveino/norstella-blockchain-en
Bitcoin address:
1sveinoFzUtMQ5wnnxMoHX9vb42mvPsWN