Yesterday, the EU Commission launched the EU Blockchain Observatory and Forum with the support of the European Parliament.
The Blockchain Observatory will focus on highlighting the key developments of the blockchain technology.
It is useful to recall that a blockchain is a “decentralized, distributed and public digital ledger that is used to record transactions across many computers so that the record cannot be altered retroactively without the alteration of all subsequent blocks and the collusion of the network” (the good, old Wikipedia has provided one of the best definitions, so far).
The blockchain technologies are often associated with cryptocurrencies, but its uses and adaptations can be multiple. Blockchain technologies are expected to transform the healthcare, insurance, finance, energy, logistics, IP rights management or government sectors.
So, the interest and concern of EU institutions on these technologies is natural and positive. Earlier in February 2017, a publication by the EU Parliament under the ambitious title “How blockchain technology could change our lives” did not go un-noticed:http://www.europarl.europa.eu/RegData/etudes/IDAN/2017/581948/EPRS_IDA(2017)581948_EN.pdf
The document included various examples of how blockchains may be used outside of the virtual currency world, for financial or non-financial purposes. We highlight some of these.
Digital media
In an era where most artworks are sold and transferred digitally without being embedded in any physical artefact (contrarily to what happened in the past with CDs, books, etc.), all the stakeholders involved face issues. Digital content producers experience the damage of piracy; while, on the other side, consumers do not really buy a product they can transfer or give away as part of an inheritance, but only a license.
Blockchain could solve some of these issues and “protect consumers and creators of digital works of all kinds by recording the ownership history of digital property and perhaps even by enforcing digital rights”. In substance, blockchain could act as a means to register any sales, loans, donations and other transfers of individual digital artefacts, preventing piracy and allowing art consumers to enjoy wider rights than they do now.
Patents
There are various well-known problems with the national (and international) patent laws. No unified EU patent system still exists. Patent protection can be very expensive and not always efficient against infringements. Albeit many aspects of the patent system are now digitised, the system itself has not been subject to major changes since the information revolution.
The 2017 EU Parliament blockchain publication acknowledges that:
Deploying blockchain technology within the patent system could reduce inefficiencies in recoding and agreeing the time of registrations in an efficient way, perhaps across several national patent systems.
Nonetheless, blockchain should not be considered apt to replace the current patent system in full, for there are still other important functions performed by patent offices: for instance, asserting the novelty of the proposed patents, publishing patents in order to foster competition, etc.
E-voting
Most political elections are still conducted off-line, on paper. For decades, the possibility of introducing voting by electronic means has been widely discussed in Europe. It is now argued that blockchain could be the tool to distribute an “open voting record among citizens”.
The 2017 EU Parliament blockchain publication observes that:
Usually, votes are recorded, managed, counted and checked by a central authority. Blockchain-enabled e-voting (BEV) would empower voters to do these tasks themselves by allowing them to hold a copy of the voting record. The historic record cannot be changed, because other voters would see that the record differs from theirs. An illegitimate vote cannot be added, because other voters would be able to see that it is not compatible with the rules (perhaps because it was already counted or is not associated with a valid voter record).
At the current stage, however, e-voting for national elections would require too demanding developments in security systems; thus, for the time being focus should be given mostly to minor elections and organizational decision-making.
Blockchain technologies could also be used for smart contracts, supply chains and many other purposes. Will the national and EU lawmakers be able to support the growth of blockchain so to provide their citizens with new, efficient political and economic tools to manage their lives?