Five Takeaways from MIT Business of Blockchain (April 22-23 / Boston, MA) May 14th, 2018Blockchain, MMM Tech Law Video Channel blockchain, cryptocurrency, technology By: Rachel Neufeld The MMM Blockchain & Cryptocurrency Group was recently in attendance at the MIT Business of Blockchain event, kicking off an exciting spring tour of conferences focusing on this promising new technology. 5 takeaways from the event: 1. There are many different types of blockchains. The word “blockchain” is a catchall phrase that describes a type of distributed ledger technology that uses cryptography to secure its data in an immutable way. There are many different types of blockchains: public blockchains, private blockchains, and permissioned blockchains. These blockchains use different consensus mechanisms (e.g. proof of work and proof of stake) and different cryptographic tools such as hashes, public key / private key infrastructures, zk-snarks, etc. The technology is also very new and rapidly changing – so blockchains might look very different 5 years from now. 2. Despite some negative press at the beginning of 2018, blockchain technology is not only here to stay, it is here to disrupt. It was very encouraging to see large crowds of people representing hundreds of different businesses who are actively trying to implement blockchain technology as part of their business. A few of these inspiring enterprise blockchain applications include: ● Supply chain improvement. A current project involves IBM and Maersk exploring the application of blockchain technology for tracking shipping containers and using smart contracts to improve speed and efficiency for global shipping. ● Provenance. Another current project involves IBM and Walmart implementing blockchain technology for improving the ability to track produce back to the farm where it was grown in a much faster and more reliable way. Some examples that stood out included (1) a reference to the 2006 E. coli spinach outbreak in the US, which took the spinach industry years to recover from, and was eventually traced back to one bad plot of land on one farm, and (2) the Walmart test of tracking mangoes using conventional methods back to their farm, which took 7 days, compared with the same testing on the blockchain, which took 2.2 seconds. ● Voting and governance. Exploring use of blockchain to aid voting in developing countries, including to prevent the now-common practice of each new political regime destroying all government records of the prior regime. Once such records are on an immutable blockchain, the new regimes will not be able to delete such records. 3. Regulation of blockchains and cryptocurrencies is far from being settled, but the hope is for answers and guidance soon. Gary Gensler, former chairman of the CFTC, raised numerous regulatory questions regarding well-known blockchains like Ethereum and Ripple. One interesting concept to watch for resolution is the idea that a token may have been a security when it was issued, but undergoes a transformation at some point and ceases being a security. This concept of being a security at one time and not being a security at another time is a novel idea that comes out of a speech made by Jay Clayton at a Princeton University event in April. A recent Coin Center article also suggests such an approach is appropriate. 4. Development of blockchains is not just on-chain; numerous off-chain technologies are being developed to work with and interact with blockchains. Layer 2 solutions, such as the lightning network designed to increase transaction throughput or “escrow” accounts designed to maintain control over cryptocurrencies while trading on exchanges, seemed to generate a lot of the buzz at this event. While blockchains can be extremely secure, decentralized and immutable, the traits that provide such security, decentralization and immutability often limit transactional speed. Layer 2 solutions allow for higher transactional throughput and efficiency at the theoretical expense of a reduction in one or more of those other beneficial traits. Sets of transactions from layer 2 are also often recorded on the main blockchain to provide those other benefits for groups of transactions, if not on a transaction by transaction level. 5. Quantum computing is a threat to current cryptographic tools used to secure the blockchain, but it is not an insurmountable threat. Once further developed, quantum computing may allow for immediate hacking of and access to everything that is secured using current cryptographic tools. This includes emails, e-commerce, credit cards stored on mobile phones, social media profiles – essentially everything that is secured with a password. Blockchains are also on this list. However, many contributors at this event are not fazed by the threat posed by quantum computing, simply stating that blockchains would adapt to newer, better cryptographic tools for security along with the rest of transactions that take place over the Internet. We are looking forward to continuing our spring blockchain conference run in New York City this week. Look for us at the following events – hope to see you there! Blockchain Week Events: Ethereal Summit: May 11th & 12th Women on the Block: May 13th Consensus 2018: May 14th -16th Token Summit: May 17th Twitter: Come find us at #BlockchainWeekNYC! We will be at @etherealsummit, @womenontheblock, @consensus2018, and @tokensummitIII. Looking forward to connecting!