After Years of Hype, Private Blockchains Face Their First Commercial Tests
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Blockchain tech has been a buzzword for much of the last two years, as industries ranging from big banks to utilities try to shoehorn it into their existing infrastructures.
Blockchain tech has been a buzzword for much of the last two years, as industries ranging from big banks to utilities try to shoehorn it into their existing infrastructures. Now, IBM is announcing two new projects that finally put the technology to the test in the marketplace.
The first deal involves Canada’s major banks, telcos and government agencies, who are using digital identity services from a firm called SecureKey. Later this year, customers of these services can opt-in to a blockchain-powered system, provided by SecureKey and IBM, which will verify their identities. They can then decide how much and what personal data to share with other companies who use the digital identity system.
As an example of how the system works, SecureKey says a bank customer would be able to share his data with a utility to open an account, removing the need to go through a separate verification process.
The second deal uses an IBM blockchain for a carbon-trading platform in China, jointly developed with a company called Beijing Energy-Blockchain Labs. The platform is touted as a more efficient way to trade carbon assets because it provides a cheaper way to audit the transactions while keeping everyone compliant. The system was trialled last November and will be available later this year, IBM says.
The SecureKey project is the more interesting one. Digital identity has long been discussed as a particularly powerful use of blockchain technology, but no prototype has been released for public use yet. If Canada’s SecureKey and IBM make their promised system easy enough for consumers to use, it would be a clear demonstration of blockchain technology’s utility. It would also illustrate the difference between these so-called private blockchains, or distributed ledgers, and public blockchains exemplified by cryptocurrencies like bitcoin and ethereum.
IBM has been promoting the commercial viability of its blockchain tech forcefully. Last month, it announced its blockchain-powered solution for a major private equity funds administrator, Northern Trust, probably the first project using the technology commercially. Blockchain tech is just one of the services IBM provides through its cloud. The cloud divisions of Microsoft and Amazon offer their own variants, and a major enterprise software provider is expected to announce its entry to the space this week. IBM’s first-mover advantage, however, may serve it well.