This short panel discussion at ICE London Tuesday morning looked into the questions surrounding the potential and security of blockchain projects. It was structured as something of a casual chat between John Caldwell, Director of Advocacy at Casino Coin Foundation, and Thomas Draksas, founder of Edgeless Casino.
Interestingly, neither of the blockchains represented in today’s talk were fully public chains. Casino coin is a private, currently centralised coin tha aims to gradually decentralise over time as it hands control over, piece by piece, to a growing set of operator nodes. Edgeless, on the other hand, calls itself a hybrid; it employs a public blockchain and the peer-to-peer networked verification which goes along with that, but still stores a lot of its data on traditional databases due to scalability issues.
Based on the discussion, it was not entirely clear how much of the transparency and fraud-proof options offered by distributed ledgers are available under these models. Caldwell did say that in the long run, Casino Coin will require even more agreement to process a transaction, over and above Bitcoin’s 51% requirement. Casino Coin will ultimately, Caldwell said, require 80% of nodes to verify a transaction for it to be processed.
Caldwell went on to explain that the core of Casino Coin’s efforts focus on digital identity on the blockchain, although he said that their developers had experienced some issues in ensuring a GDPR-friendly approach to storing sensitive user data on a blockchain.
One solution their blockchain employed, which was developed as a fork on the Ripple payment protocol network, was a method of storing user data securely in a traditional database hosted with their partner Jumio and to keep a reference ID for each unit of stored data on the blockchain itself. In an aside, Caldwell pointed out that the blockchain is not suited to the storage of huge amounts of data anyway, since the data is replicated on every node.
Caldwell also mentioned that their systems possess warning triggers for money laundering cases and tools that enable regulators to scrutinize all transactions, and emphasised that Casino Coin deals only with fully regulated operators in white markets.
Edgeless has gone in a different direction from the start, building itself on top of the vast Ethereum network. This large community of interested parties gives Ethereum a great chance of long-term success, Draksas said, who emphasised that Edgeless still uses the public blockchain for more secure requirements regarding data integrity.
Potential investors, however, must be careful to distinguish between the strength of the underlying encryption in the blockchain and its application and implementation in a particular business case or in an exchange.
As for identity verification on the blockchain, it seems Casino Coin are moving in that direction, with Caldwell describing digital identity as “the future.” Edgeless are focusing on classic approaches to identity for now, with Draksas saying that their digital identity technology was not there yet.
Hacking and the potential for blockchains to become compromised was also touched upon. Caldwell and Draksas agreed that, while the independent developments based on existing blockchains might become compromised due to errors in the applications built on them, the underlying encryption in the code itself will likely never be hacked, based as it is on extremely strong ECC code that appears resistant even to the potential power of future computer systems like quantum computing.
