Category: News

  • HUB Security Teams with Marsh to Offer Unique Insured Storage Solution for Digital Asset Custodians

    HUB Security Teams with Marsh to Offer Unique Insured Storage Solution for Digital Asset Custodians

    TEL-AVIV, Israel, Oct. 1, 2020 /PRNewswire/ — HUB Security, a leading hardware cybersecurity solutions provider, announced today its collaboration with Marsh, the world’s leading insurance broker and risk adviser, to offer a unique insured storage solution that enables US-based financial institutions to securely and with confidence offer digital asset custodial services.

    Financial institutions can now store and manage digital assets, including cryptocurrency, on HUB’s military-grade technological platform and purchase up to $400 million in “cold storage” insurance through Marsh’s Digital Asset Risk Transfer (DART) team to cover the risk of theft or damage to the assets or destruction of private keys.

    The solution, backed by A rated insurers, follows the August interpretive letter from the US Office of the Comptroller of the Currency (OCC) clarifying that national banks and federal savings associations may provide cryptocurrency custody services on behalf of customers, including the holding of unique cryptographic keys associated with cryptocurrency.

    “The crypto custody market is poised to grow significantly following the OCC regulatory clarification,” said Ankur Kacker, Senior Vice President and a Specie specialist on Marsh’s DART team. “Our combined insured storage solution can provide financial institutions seeking to enter the market a secure place to safeguard their clients’ assets and peace of mind knowing their exposures are covered.”

    “Together, HUB and Marsh are empowering banks and other financial institutions to offer services for storing their clients’ digital assets by ensuring they are digitally secure and protected,” said Eyal Moshe, CEO & Co-Founder of HUB Security.

    About HUB Security

    Hub Security is a top-tier, military-grade provider of programmable HSM and key management solutions for fintech, cloud, and blockchain security. Leveraging military-grade cybersecurity tactics and utilizing cutting-edge innovations, HUB Security has developed a family of products that provide the highest level of enterprise security available on the market today. https://hubsecurity.io/

    About Marsh

    Marsh is the world’s leading insurance broker and risk adviser. With over 35,000 colleagues operating in more than 130 countries, Marsh serves commercial and individual clients with data driven risk solutions and advisory services. Marsh is a business of Marsh & McLennan Companies (NYSE: MMC), the leading global professional services firm in the areas of risk, strategy and people. With annual revenue approaching US$17 billion and 76,000 colleagues worldwide, MMC helps clients navigate an increasingly dynamic and complex environment through four market-leading businesses: Marsh, Guy Carpenter, Mercer, and Oliver Wyman. Follow Marsh on Twitter @MarshGlobal; LinkedIn; Facebook; and YouTube, or subscribe to BRINK.

    SOURCE Hub Security

    Related Links

    https://hubsecurity.io/

  • On Privacy Enhancing Currency & Supply Adaptability

    On Privacy Enhancing Currency & Supply Adaptability

    One factor that has been constantly getting modified since the deployment of the World Wide Web and the Internet in the 1990s (research started in the 1960s) is the inter-mix of transparency and privacy. Modifications took place in security (storage, transferring, etc) and in speed (overall time taken for data to get transferred from one place to another) as well. Another alteration that’s being observed and experienced currently is the shift from an authoritative functioning architecture to a decentralized or semi-authoritative platform. The desire of a change from the authoritative form of functioning to a decentralized form began due to the 2008 financial crisis (also called as Global Financial Crisis). Decentralized blueprint(s) of platforms and applications initially began for specific industry’s unique issue. Observing and experiencing success in many scenarios, the desire to widespread and sustain simultaneously came into the picture. ZKP (Zero-Knowledge Proof) can be said as an upgraded version of initial successful models. In this piece, you will get to know something about ZKP’s enhancing inter-linkage between currency and supply adaptability.

    The following content will encompass some illustrations and/or proposed prototypes which enable increment of privacy of digital currency(s) and adaptability in supply-chain as well.

    This piece of research broadly reviews the privacy-preserving answers in the Blockchain ecosystem and the current as well as expected issues that might arise in coming times. Figure 2 and 3 showcases how identity management has altered itself with changing times concerning privacy and time and gives an idea about the backend process of functioning of Self-Sovereign Identity Management (SSID) model in the blockchain. The working flow and the relationship between the User, Issuer, and Service Provider/Verifier in an abstract fashion are showcased. Unlike in a centralized ecosystem where the user doesn’t have any control over data being utilized, in a decentralized ecosystem, the user has control/authority over data used in DID (decentralized identifiers) documents, Wallet Apps, etc. So far, the focus has majorly been on security aspect in the specific task/prototype. For making it economically widespread and adaptable simultaneously, first ZKP was introduced, after which zk-SNARK (Zero-Knowledge Succinct Non-Interactive Argument of Knowledge) got deployed. Besides ZKP and zk-SNARK, Ring Signatures, Homo-morphic hiding, and Secure Multi-Party Computation (SMPC) are utilized as privacy-preserving approaches in the blockchain. If you want to know about distinct categories of taxonomy privacy-preserving techniques in blockchain, then figure 4 will help you in understanding the categories with clarity. The next piece of research introduces a signaling and screening scheme via a non-central approach for clarifying accountability to diminish the risk caused by asymmetric implications on authentication.

    For improving the privacy, the process of authentication is said to be the show-stopper. SK4SC (Secure Kernel for Supply Chains) is a proposed prototype which assists in achieving privacy enhancement. SK4SC comprehends a probabilistic verification system for authentication process which encompasses (but not limited to) design, manufacturing, procurement, inspection, disposal, and shipping. To know more about the blueprint of SK4SC’s architecture, see figure 1. Hysteresis digital signature alongside signature log chain crossing is utilized for blockchains as public directories. Hysteresis digital signature is a cryptographic technique developed to overcome the issue of some applications where digital signatures require validation for long intervals. The issue gets resolved by chaining signatures of each document in a manner that every document is depended on its predecessors (hash values) signed documents as well. Coming back to figure 1, that showcase the backend functioning of the prototype, the functioning happens via two protocols. The two protocols are, “sharing of information”, and “derived information that’s to be shown as authentic and sharing of witness values for a ZKP (zero-knowledge proof)”. For appropriate synchronization and symmetry in distribution, the information requires reporting and addition to public ledgers. Besides the Hysteresis digital signature, SK4SC also utilizes ZKP-based cryptographic protocols (Camenisch-Lysyanskaya and Camenisch–Shoup) that come under the Random Oracle Model. Figure 3 showcases the similarity of this prototype with a CRM having royalty points. The royalty in the prototype can be considered as the counter value payback paid by the user. Figure 3 gives an illustration of e-Government with taxation. Another illustration is HARB which assists in decentralized energy trading.

    Besides the financial services and medical industry, the energy sector is one area which is in talks/discussions/debates for transforming the industry by shifting it to a decentralized form (from functioning perspective). One illustration which showcases the increase-in curiosity and imbibing of the decentralized framework with regards to Energy Sector is HARB (Hyper-graph based Adaptive Consortium Blockchain Framework). The distinguishing factor in this prototype is that it coordinates Distributed Energy Resource(s) (DER) via high-order relationships instead of P2P pair-wise relationships. Figure 2 showcases the overview of HARB framework. The left side of the figure represents the abstract form of three layers (contract layer, overlay layer, and underlay layer), while the right-hand side represents the in a little detail about their background functionality(s). Underlay layer also referred to as the physical layer (for this prototype) articulates distinctive relationships from the unique time; location; identity; and context derived from the characteristics of the nodes interacting in a particular grid. Afterwards, appropriate relationships for community unearthing is being done by scrutinizing the frequency of interactions among nodes.  Observing concentrated interactions signify a presence of intra-community relationships, while meagre interactions indicate inter-community relationships. You can say that the overlay layer forms the blockchain network model (BNM), which encompasses the Adaptive blockchain-modules manager (ABM) and blockchain client manager (BCM) (showcased in figure 4). Nodes are consciously clustered by the ABM via high-order interaction manager, nodes resource manager, and modules manager as well for forming modules. Every module manager deploys a blockchain service (endorsing, ordering, authenticating, committing). For each node to function appropriately, module manager in ABM allocates a role for each node depending on capability, reliability, and reputation as well. Lastly, the contract layer encompasses the application network. Applications also referred to as smart contract help in defining user requirements which are provided by utilizing blockchain services. The next potential practical example interlinks the tourism sector with decentralized technology.

    Tourism is another sector which is imbibing decentralized technology(s). According to this piece of research, with more individuals traveling to different nations more often (for professional or personal purposes), the security aspect is changing and is expected to change furthermore. The fourth revolution based technologies like blockchain will assist in achieving the appropriate outcome. The known traveler digital concept introduced here can be seen as one step closer to getting a systematic shift in overall security in tourism. One reason (among others) is that it will be acting as a catalyst for improving the holistic security in the tourism industry. Through the known traveler digital concept, you/user will have control over the use of their data and act as an empowered individual hence contributing to the security from a broader perspective. The core technologies which are being in use are:

    1. Distributed edger Technology
    2. Biometric Technology
    3. Cryptography
    4. Mobile Interface

    The infographic shown below gives a potential outline of how user information will be interlinked with decentralized technologies.

    To understand in the crux, your/traveler’s data which roughly encompasses (biometrics, mobile data, and agent’s information) which was previously administered by a central authority will now be decentralized. This means that the data source/s would be each traveling, the data will be encrypted with the recently updated algorithm, and indexing would be done via hashing or some other open-sourced algorithms to have proper accountability, transparency, and keeping the data safe simultaneously as well. To get a small idea about how the prototype will work, look at figure 11.

    This piece of research dwells into the area of supply making adaptable in ZKP. ISA95 is seen to be compatible with the fourth industrial revolution technologies like Artificial Intelligence, Blockchain, Internet of Things, etc. One reason for ISA95 to become usable with blockchain technology and sister-like technologies is the modification from ISA95-CTS (compliant traditional manufacturing systems) into SMMS (geographically distributed smart manufacturing) units. Functional requirements are also seen as a process defining the characteristics of the software include:

    1. Node-to-ledger communications
    2. Ledger-to-ledger communications
    3. Ledger-to-interplanetary file system communications
    4. Ledger-to-external data sources communications (oracle)

    Figure 2 to figure 6 represents the use-cases/characteristics pictorially mentioned in the above points making you help understand the backend workings of how data flows in each layer. To see the blueprint of overall functioning after all components become interoperable, view figure 7. In crux, the figure shows the relationship between smart contracts, distinct prototypes, and decentralized applications.

    Based on the proposed prototypes mentioned above, it’s affirmative to say that privacy enhancement along with supply adaptability would become the norm in the coming days. As curiosity has increased multifold, expect to come across newer decentralized platforms and applications a lot sooner. Visit Primafelicitas to know more about the latest updates in the blockchain ecosystem and decentralized technologies at-large.

  • Blockchain newsletter for July: Blockchain and other technologies make for powerful solutions

    Blockchain newsletter for July: Blockchain and other technologies make for powerful solutions

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    With blockchain’s growing maturity, innovators of all stripes are finding new opportunities in combining blockchain with other technologies. Blockchain + AI. Blockchain + IoT. Blockchain + confidential computing. In all these synergistic combinations, the formula adds up to greater value overall.

    EXCLUSIVE video preview: IBM’s Jerry Cuomo on Blockchain and AI
    Hear from Jerry Cuomo, IBM Fellow and VP & CTO, AI Automation, and IBM Blockchain founder, and learn how AI + Blockchain result in authenticity, augmentation and automation.

    The mix of blockchain and AI is fueling Industry 4.0, enabling organizations to unlock trapped value, enhance trust and drive digital transformation. IPwe, an IP transaction platform powered by IBM solutions for AI, blockchain and cloud, uses AI to make sense out of millions of patents and blockchain for its patent marketplace.

    Learn how industries are revolutionizing business with IBM Blockchain

    Blockchain’s secure handling of data, along with speed, transparency and traceability, underpins many blockchain + IoT use cases. In the supply chain, IoT devices record location, temperature, humidity and other indicators of how goods are handled — for example, pharmaceuticals in the solution from Sonoco and IBM and wine in the solution from eProvenance and IBM. That data is stored on a blockchain network where it can be viewed by all permissioned participants.

    Blockchain and smart contracts can also enable smart IoT devices to communicate securely, complete transactions and execute commands without human intervention, bringing new capabilities to smart cities and the energy, automotive, agriculture and manufacturing industries while addressing IoT’s inherent issues around security and privacy.

    Blockchain security levels up a notch when combined with confidential computing, the technology that isolates and protects data during processing. Combined, the two technologies offer an end-to-end security solution that protects data at rest (immutably stored on blockchain), in motion (encryption) and in use (confidential computing).

    July’s features of “watch, read and listen”

    Choose your learning path: Blockchain Foundation or Advanced
    Learn from two blockchain analysts, Martha Bennett of Forrester and Craig Wentworth of Independent Thought, as they share their insights around using blockchain to solve critical business problems.

    Webinar: Is it time stop talking about blockchain?
    Get insights from Forrester’s Martha Bennett on the foundations of blockchain for business, what the technology can and can’t do, and the key success factors of any blockchain project.

    Case study: Ledgermatic builds a secure foundation for digital assets
    Read how Ledgermatic was able to move corporate assets, workflows and financing onto blockchain by using IBM Confidential Computing.

    Video: Value Visionaries – Guilda Javaheri, CTO, Golden State Foods
    Learn how Golden State Foods combined RFID to track fresh beef’s movement, IoT to monitor its temperature, and blockchain to orchestrate the supply chain.

    Our solutions and how to get started

    No matter where you are in your adoption journey or what industry you’re in, we’re here to help you use blockchain technology to reach your business goals.

    Still not sure where to start? Schedule time to talk with one of our experts specific to your industry, and they can help guide you in the right direction.

    We’ll be back next month with more news you can use from IBM Blockchain. In the meantime, if someone forwarded you this email and you’d like to subscribe, sign up here.

    blockchain platformBuilding on the leading blockchain platform

    The leading open source blockchain for business platform transforming companies and driving growth.

    Learn about IBM Blockchain Platform

  • Sathish N, FSS – Tech Observer

    Sathish N, FSS – Tech Observer

    With open banking and instant payments increasingly becoming mainstream, back-office enterprise reconciliation systems need to keep pace. Conventionally, transactions typically were processed in a batch mode and payments took hours, if not days, to process, clear and settle. Now, reconciliation and settlement cycles have been compressed. This puts tremendous pressure on any institution’s back office to support multiple intraday settlement cycles and reconcile data in near real-time.

    That is why financial institutions are looking for end-to-end enterprise level automated reconciliation processes that can help them scale to handle large influx of transaction data, improve speed, manage operational risk, and address compliance needs.

    According to Sathish N, Deputy Chief Product Officer, FSS this is what AI and Machine Learning promise to deliver. “By employing machine learning at key data reconciliation points, reconcilers can unlock multiples of value in terms of time, operating cost and avoiding regulatory penalties,” he said in an interview with Tech Observer,  adding that advanced ML algorithms can improve process efficiency across multiple reconciliation points.

     Edited Excerpts: 

    How automating reconciliation systems helps in improving the efficiency of processing transactions?

    With digital payments growing exponentially, millions of transactions are exchanged daily between multiple payment ecosystem constituents. The payment or transaction settlement cycles varies basis the combination of stakeholder and different applications that are used and accounting records maintained by these multiple processing systems need to be in sync at different stages of the transaction. The accuracy of the financial close process is crucial to maintaining the financial integrity of the ecosystem, mitigating risk, and fostering trust amongst customers.

    Further with open banking and instant payments increasingly becoming mainstream, back-office enterprise reconciliation systems need to keep pace.  Conventionally, transactions typically were processed in a batch mode and payments took hours, if not days, to process, clear and settle. Now, reconciliation and settlement cycles have been compressed. This puts tremendous pressure on any institution’s back office to support multiple intraday settlement cycles and reconcile data in  near real-time. Current manual or semi-automated processes simply cannot  scale to accommodate new business needs.

    End-to-end enterprise level automated reconciliation processes can help financial institutions and corporates scale to handle large influx of transaction data, improve speed, manage operational risk, and address compliance needs.

    Improve Accuracy and Lower Risk of Error  

    A single exception can result in significant losses and reconciliation teams handle a large number of exceptions every day Automating reconciliation and certification processes throughout the entire financial close lifecycle, reduces the risk of errors.

    Lower Exceptions and Write-Offs

    With automated reconciliation processes accounting discrepancies can be proactively identified and corrected before customers even register a complaint.  As an example, the customers could have cancelled a transaction, but the corresponding credit may have not been received due to a technical glitch or a system error or an actual fraud that has occurred.   With detailed audit trails such discrepancies can be easily identified, enabling banks to reduce exception investigation handling  time by 90%,  optimize dispute handling costs which in turn aids with risk mitigation

    Mitigate Compliance Risk

    With improved data management and audit trails, financial institutions reduce compliance risk and ensure compliance with audit and regulatory requirements.

    Enhance Productivity

    Automate time-consuming manual processes in reconciliation operations, saves time staff spends on reconciliation processes, freeing resources to focus on strategic added value work including risk mitigation, and operational improvements

    How AI and ML could be used by banks to overcome the challenges in reconciliation systems?

    A growing number of channels, instrument complexity, and activity spread across multiple service providers and increased transaction frequency by consumers adds to the complexity of the reconciliation process. AI and Machine Learning will have a significant upside on the efficiency of the reconciliation process. By employing machine learning at key data reconciliation points, reconcilers can unlock multiples of value in terms of time, operating cost and avoiding regulatory penalties,

    Advanced ML algorithms can improve process efficiency across multiple reconciliation points. The reconciliation process typically entails tasks such as onboarding payment classes, extracting, and normalizing data from non-standardized file formats, defining matching rules and posting entries for settling accounts.

    Conventional systems rely on a static pre-configured “rule-based framework” for payments reconciliation. However, these tools can become inefficient while adding new data sources or if new entries are introduced in a particular reconciliation file, these need to be identified manually. Further reconciliation teams need to create, test, and implement new rules whilst balancing the impact on existing rules which prolongs the reconciliation cycle time. With ML-enabled processes, the  system automatically “learns” the data sources and patterns, analyzes it for likely matches across multiple data sets, highlights reconciliation exceptions / mismatches, and presents actionable “to do” lists to resolve data issues.

    The use of Robotic Process Automation can automate routine, manually  intensive tasks.  Let me give you an example.  Even today banks with automated reconciliation processes deploy dedicated personnel to fetch files from an interchange portal or a  dispute management system, download the files and place them in the right location for the reconciliation system to act on the data.  Such tasks can be automated by use of bots, maximizing value of employee time.

    Payment reconciliations have become exceedingly complex, with multiple payment options, channels, combination of product processors for different payment method across line of business and the need for speed and accuracy of reconciliation is crucial for businesses. FSS Smart Recon offers an AI-based solution for reconciliation management across payment workflows, with built in support for, multi-source, multi-file many-to-many reconciliation scenarios. With FSS Smart Recon customers can achieve  a 40% improvement in time to market for greenfield implementations, a sizable 30% betterment in reconciliation time cycles, and an overall 25% lessening in direct costs as compared to partially automated processes FSS Smart Recon adds value in the following ways:

    • A unified platform for providing a modern, fully web-based reconciliation platform system to handle end-to-end reconciliation which incorporates data import, transformation and enrichment, data matching, exception management
    • Wide application – Supports all classes of digital payments using a single system – General Ledger Reconciliation  Tally, ATM Reconciliation, Card Reconciliation, Online Payments, Wallets, Instant Payments (IMPS and UPI), NEFT, RTGS and QR Code Payments — with built-in flexibility to rapidly onboard new payment channels and schemes
    • Universal Data Wizard: Simplifies set-up of the reconciliation process via a template-based data-mapping framework. This optimizes go live time for greenfield implementations by 30 per cent
    • Detailed Audit Trail: Provides a detailed audit trail helps users understand the rationale behind a break or match case and address it accordingly.
    • Advanced Exception Identification and analysis for advising timely action and follow ups to enable closure of the same
    • AI-based Settlement Processes Leveraging Machine Learning (ML), algorithms, FSS Smart Recon continually learns file patterns and can automatically identify new records, enabling staff to predict exceptions and perform resolution actions, without the need of constant support or professional services.
    • Dispute Management – Support for dispute and chargeback lifecycle enabling banks to respond to disputes in much shorter time frames – enhancing efficiency as well as  customer service.
    • Flexible Business Models: FSS offers Recon services as a licensed and a SaaS model, d to provide greater deployment flexibility to customers, eliminating the need for upfront capital expenditure and

    What are key technology trends are you observing in reconciliation space?

    Rapid payments evolution, market competition, and advancements in technology continue drive evolution and modernization of reconciliation processes. Technology trends that are  gaining momentum include

    • Greater adoption of SaaS and cloud-based models to accommodate growing transaction workloads and  to lower total cost of ownership
    • Blockchain is a perfect choice for complex reconciliation and would be the next differentiating inclusion in global leading products
    • Enhanced use of AI and Machine Learning AI-based algorithms for self- supervised and self-optimizing recon processes
    • Smart use of data by designing the right data layer or system of record layer to to improve  performance, precision of matching , operations, and fraud controls

    What would be the upcoming focus areas for FSS?  

    Our next big launch is around analytics and data science, the wealth of data today in most large organizations is pushed to a Data Lake or a warehouse and very little is being done to leverage these insights to make an impact to your customers or business. The product is designed to address this specific Big Data opportunity in the payments space. The product is a complete persona-based analytics suite that comes with predefined insights by business product areas, the matrix keeps growing and will soon map the entire payment ecosystem. The product helps banks to make data-driven business decisions, enhance productivity and business efficiency.

  • What are Crypto Credit Cards and How did they Work

    What are Crypto Credit Cards and How did they Work

    Today, cryptocurrency has become more popular than stocks among UK investors. After all, it has been a consistent topic of conversation in the financial world, and now, even the credit card industry wants to be a part of the buzz by rewarding customers with digital currencies.
    The question now is: Should you get a crypto credit card? Read on to get your answer!

    What is a Crypto Credit Card?
    Basically, a crypto credit card uses an incentive-style payment method that gives users cryptocurrencies as rewards. Similar to traditional rewards credit cards, this card is also supported by the world’s largest payment processing networks, Visa and Mastercard, so you can use one anywhere in the world.

    Aside from crypto enthusiasts, this innovation is perfect for those wanting to try out cryptocurrency but do not have the resources to jump in the market just yet. Moreover, since the value of cryptocurrencies continues to grow, the rewards are very tempting.

    How Does it Work?
    A crypto credit card works just like any other type of credit card. Use your card for your purchases, and you will be eligible to earn rewards. Instead of rebates or airline miles, your card will help you earn and redeem cryptocurrencies.

    Come springtime this year, Visa and financial tech company BlockFi will release the Bitcoin Rewards Credit Card, the first-ever credit card to offer crypto rewards, to all US residents, except for those in New York. Cardholders will get a 1.5% cashback on all their purchases, which will then automatically be converted to Bitcoin and stored into a BlockFi account. The crypto funds can be spent, withdrawn, and traded as the users wish.

    However, that reward does not come easily! This crypto rewards card also has its fair share of fees, and some of them might vary, since this is a very new development. With traditional cards, a guide to credit card fees by Petal points out that banks often charge account setup fees and annual fees, on top of fees for things like foreign transactions and late payments. These are paid on top of interest charged on the purchases you make with your credit card.

    With crypto credit cards, the annual fees may be offset, but again, this depends on the company. With the Bitcoin Rewards Credit Card, users have to pay a $200 (£144) annual fee, but this can be waived for the first year if they earn $250 (£180) in bitcoin and spend a minimum of $3,000 (£2,160) in their first three months as a cardholder. But if you wish to expand your cryptocurrency portfolio, you can look at the deals from Tomo Credit Card, where users can choose among Bitcoin, Ethereum, and Litecoin, for their rewards and redeem them 28 days after paying the monthly dues in full. But apart from the membership and annual fees, be sure to check into the fees for redeeming cryptocurrency.

    Should You Get One?
    Crypto credit cards offer an easy way to get started on cryptocurrency, removing the hassle of currency exchanges and additional fees. This can be the start of your investments, as you stash away crypto without thinking too much about it. Over time, these rewards can rise in value, especially as the crypto market continues to grow. This advantage can not be applicable to other forms of credit card rewards like cash back or airline miles, which decline in value even if you try to resell them.

    On the other hand, the rewards system is not exactly stable, with cryptocurrency being volatile. Also, you may lose control over when you make a purchase. Say, you were eyeing a crypto purchase, and it is presently valued high, but by the time you earned the rewards, the price has already dropped. As a result, you spent more but received less. Not to mention, while you can buy some products and services with your cryptocurrencies, these rewards are not spendable. You still have to convert these crypto rewards into dollars, so that you can spend them. Lastly, although Bitcoin rose to popularity as a decentralised system, you can never be too sure about its anonymity.

    So, should you get a credit card? It’s entirely up to you — but remember that you still can choose between traditional or crypto credit cards. Evaluate your financial situation first, and do your research. Should you choose to get a crypto credit card, be sure to read the fine print and accept that risk is a part of your decision. But if you choose to stick with traditional credit cards, be reminded to spend wisely and always make your payments. In that way, you are also rewarding yourself in the long run.

    Article written by Renee Joyce|
    For the exclusive use of www.primafelicitas.com

    AUTHOR BIO: Renee Joyce isan aspiring blogger and journalist with an interest in all crypto technology after becoming intrigued by the rise of Bitcoin in 2010. Today, she enjoys reading and writing content relating to the various trends in the world of crypto, and the technology’s increasing success. When she’s not following leads on the latest developments in blockchain technology, she loves to enjoy classic films from the Golden Age of Hollywood, and collects physical copies when she can. She also likes to write a great deal about the slow and steady decline of croquet, and she is passionately working hard to change the perception that the noble sport is merely for the elderly.

  • Making permissioned blockchains interoperable with Weaver

    Making permissioned blockchains interoperable with Weaver

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    Distributed ledger technology (DLT) has gone beyond its experimental phase and is now actively managing several enterprise workflows around the world in areas like trade logistics, export finance, inter-bank payments, and regulatory compliance. But this has not led to convergence, either to a default technology stack or to a single global network that everyone runs applications on.

    Permissioned networks of limited scope and guarded memberships are here to stay as they offer privacy, auditability, and performance, which open platforms like the Ethereum Mainnet cannot offer. DLTs of different flavors — prominently The Linux Foundation’s Hyperledger Fabric, Corda, and Ethereum adaptations — are also here to stay because each offers a unique set of capabilities that emerge from their designs, and minimum viable ecosystem (MVE) networks of proven value have been built on each of these flavors.

    This has resulted in a fragmentation of the blockchain ecosystem, with independent networks running on different DLT stacks managing processes of limited scope and creating data and asset silos. This situation severely undermines the value proposition of blockchain as the processes and assets that are artificially segregated in the blockchain world are interdependent in the real world.

    Register now for this on-demand webinar

    One way to maximize network effects of individual blockchain networks without forcing them to merge is enabling interoperability in a decentralized and secure manner without relying on trusted authorities. This is the mission of the Hyperledger Weaver lab. Before looking at its internals, let’s look at some examples that will illustrate why interoperability is so crucial to the success of enterprise blockchain.

    Why enterprises need DLT interoperability

    International trade is a complex beast with no central coordinator or law-enforcing authority. Various processes have been created and refined ad hoc over centuries by merchants, financiers, and regulators, to manage supply chain logistics and cross-border financing, ensuring that parties can hedge their risks, mitigate fraud, and comply with shipping guidelines that vary with locale. Still, these processes tended to be cumbersome, expensive, and time-consuming. Therefore, the emergence of permissioned blockchain and DLT was recognized by traders, financiers, and regulators for its immense potential to improve efficiency while simultaneously reducing risk.

    Several networks have been launched to handle portions of the trade ecosystem, such as TradeLens (built on Hyperledger Fabric) for trade logistics, IBM Food Trust (built on Hyperledger Fabric) for food tracking, and we.trade (built on Hyperledger Fabric) and Marco Polo (built on R3 Corda) for trade finance, as well as others for cross-border payments and KYC. No single instance of international trade can be completed without the involvement of several of these networks, yet today they remain disconnected from each other, potentially relying on insecure custom mechanisms to link with each other.

    Networking trade logistics to trade finance

    Let us examine one such potential link, between a network that manages trade logistics to another that facilitates trade finance. The first runs smart contracts managing the logistics of exporting goods, from preparing a shipping consignment to dispatching it via a carrier and recording a bill of lading (B/L) for payment claiming purposes.

    The second network runs smart contracts that facilitate the issuance and fulfillment of letters of credit (L/C). The purpose of an L/C is to assure a seller (and its bank) that payment will be made upon the production of documentary evidence, typically including a B/L, for the dispatch of agreed-upon goods. This arrangement allows the seller to risk parting with goods before getting paid as L/Cs are generally issued by reputed banks.

    This trade finance network therefore depends on the seller (or exporter) supplying a bill of lading. But the seller has an incentive to supply a B/L as it stands to make money from the transaction, and a fraudulent seller may try to supply one without actually shipping any goods. The only way the trade finance network contracts and the buyer (or importer) can be assured that goods were shipped is if they can verify that the supplied B/L is the same one that was recorded on the trade logistics network’s ledger. Hence, one form of interoperability involves a network obtaining data from another’s ledger with proof of that data’s authenticity. We term this data sharing.

    Networking components of financial services

    Let’s look at a different example, one drawn from the areas of financial markets and digital currency. In traditional financial markets, parties trade assets such as securities and derivatives for cash or other assets. To reduce risk, various clearing and settlement processes and intermediaries are often involved.

    One form of settlement is a DvP (delivery versus payment) where the transfer of securities is performed only in the event of a corresponding payment. This arrangement reduces principal risk by ensuring that both parties receive their end of the exchange. However, settlement in financial markets are slow and time consuming. As in the trade scenario, it involves counterparty risks and requires intermediaries.

    Over the past few years, we have been seeing significant efforts in digitizing and tokenizing both currencies and securities on DLT infrastructures. We have seen concerted efforts around Central Bank Digital Currencies (CBDC) being added to the landscape of other blockchain-based payment networks. Against this backdrop, several central banks have been exploring the potential of performing DvP settlement across a currency ledger (let’s call it the Central Bank Digital Currency Network, or CBDCN) and a securities ledger (Financial Securities Network, or FSN). Consider then, a scenario involving two networks, one maintaining a currency ledger and another a securities ledger, both based on different DLT protocol stacks, performing a coordinated transfer of assets (DvP) in their respective ledgers.

    To effect the settlement of an exchange between Commercial Banks A and B, the following two transactions will have to happen atomically across both networks: transfer of payment from Bank B’s currency account in CBDCN to Bank A, and the entitlements of the designated securities are transferred from Bank A to Bank B in FSN. This is an example of another form of interoperability, one which we term asset exchange.

    A third form of interoperability is asset transfer, where an asset must be moved from one network’s ledger to another network’s ledger. As an example, think of two CBDC networks maintaining accounts for distinct clientele, and some amount of currency must be transferred from Bank A’s account in one network to Bank B’s account in another. Asset transfers are like asset exchanges in their need for atomic transactions across two networks — the destruction of an asset on one ledger must occur simultaneously with its recreation in another; either both happen or neither does. But asset transfers raise additional issues of asset integrity because they involve destruction and recreation, unlike exchanges which simply involve change in ownership.

    Using Weaver to link business networks

    What these examples and abstractions emerging from them illustrate is that enterprise blockchain and DLT networks offer very limited use if they remain isolated from each other. Trusted and decentralized interoperability among independent blockchain networks is critical to realize the full potential of the technology while allowing the ease and flexibility of building valuable networks with minimum viable ecosystems. We envision a world of blockchain networks that have the ability to interconnect with each other, on demand, just like TCP/IP-enabled inter-networking among computers two generation back. However, interoperability is not a straightforward task like API integration across enterprise domains. It has to tackle challenges arising from the need to link private networks that have no common controlling authority.

    Here is where the Weaver code comes in. Incubated in IBM Research, Weaver’s mission is to link processes and enable seamless but controlled flow of assets and data across DLT network boundaries. Weaver seeks to achieve this while maintaining the autonomy of the networks and the ledgers within and avoiding dependencies on trusted intermediaries.

    Weaver is a general-purpose interoperability framework that provides a common set of capabilities for trustworthy information communication across ledgers, whether they belong to the same network or different networks running on different DLT stacks. Among the key principles that guide Weaver’s design are accommodating DLT heterogeneity without requiring changes to existing DLT protocols, relying on common standards for communication but not requiring trusted intermediaries or third party infrastructure, and relying on networks’ native consensus mechanisms to finalize cross-network interactions.

    For overviews of how Weaver works, do check out our project repository and the official documentation. Also check out the RFCs for detailed specifications and the Getting Started guide to setup a test instance of Weaver and experiment with different interoperation scenarios.

    The road ahead for interoperability

    Weaver presently offers a capability (or protocol) for data sharing with authenticity proofs among networks built on Hyperledger Fabric and Corda. It also offers an asset exchange capability using the well-known Hashed Time Lock Contract (HTLC) pattern for Fabric, with work actively underway to extend support for Hyperledger Besu. Further, we are adding support for decentralized identity management among networks, which several protocols in the Weaver suite will need, based on written specifications and experimentation conducted in the recent past.

    We have written articles and published research papers describing our work and our vision. The project was open-sourced to the Hyperledger Labs earlier this year because we believe that projects like these must help the blockchain (or DLT) community converge to universal open standards, which requires collaboration. With community help, we hope to rapidly expand Weaver’s DLT portfolio and protocol suite.

    For more information on our Hyperledger code contributions, register now to see our on-demand webinar.

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