供应链的区块链包容性部署：区块链互操作性框架.docx

《供应链的区块链包容性部署：区块链互操作性框架.docx》由会员上传分享，免费在线阅读，更多相关内容在行业资料-天天文库。

ContentsPreface4Executivesummary51.Blockchaininteroperability–context6anddefinition2.Threelayersoftheblockchain10interoperabilitymodel3.Interoperabilityapproaches134.Pickingtherightapproach165.Currentstateofinteroperability18solutions6.Interoperabilitycasestudies207.Checklistforinteroperability21requirementsGlossary22Contributors23Endnotes24 PrefaceNadiaHewett,ProjectLead,BlockchainandDigitalCurrency,WorldEconomicForum(CentrefortheFourthIndustrialRevolution),UnitedStatesPublicandpermissionedblockchainsarenowwidelyusedforconsumer-to-consumer(C2C)andbusiness-to-business(B2B)dataexchanges.Inpublicblockchains,interoperabilityhasbeenindevelopmentformanyyears–forinstance,cross-chain,sidechains,proxytokens,etc.However,abiggerchallengeand,atthesametime,amuchbiggeropportunityexistsgiveninteroperabilityamongenterprise-gradepermissionedblockchains.Whilestillevolving,somesolutions,suchastradefinanceplatformsbuiltunderonejurisdiction,failtorealizetheexpectedvalue,becausetradeandsupplychainsareglobalbynature.Thevaluewillcomeoncedifferenttradefinanceplatformsindifferentcountriescaninteroperate.Similarly,atraceabilitynetworkisuselessifdatacannotbeexchangedacrossindustries,includingmanufacturers,logistics,wholesalersandretailers.Contrarytocommonbelief,thisspecificchallengeisnotonlyatechnologyproblem,butalsoaproblemintermsofgovernance,dataownershipandcommercialbusinessmodelsthatincentivizeecosystemstakeholderstocollaboratewitheachother.The2020coronaviruspandemicexposedweaknessesinsupply-chainsystems.Organizationsglobally(inboththepublicandprivatesectors)showedvaryingdegreesofabilitytorespond.Thisrevealedabreakdowninthecollaborationrequiredtotrack,trace,authenticate,financeandclearmedicalgoods,supplies,etc.throughtradechannelsinatrusted,verifiableandefficientmanner.SuchglobaleventshighlighttheneedforaninterconnectedandinteroperablesupplychaininaworldafterCOVID-19.Contrarytocommonbelief,thisspecificchallengeisnotonlyatechnologyproblem,butalsoaproblemingovernance,dataownershipandcommercialbusinessmodelsintermsofhowtheyincentivizeecosystemstakeholderstocollaboratewitheachother.Interoperabilityisthecapacityofcomputersystemstoexchangeandmakeuseofinformation.Itisthecapacityofsystemstocollaboratewitheachother,wherecollaboratinginthissenseentailstheabilitytotransferinformationoranassetbetweentwoormoresystemswhilekeepingthestateanduniquenessofthatentityconsistent.Thedistributednatureofblockchainmakesthisordinarilystraightforwardconceptquitecomplex.Inaddition,interoperabilityforblockchainplatformsimpliesthattransactionsinvolvingpartiesorassetsthatbelongtodifferentblockchainplatformscanbeexecutedasiftheybelongedtothesameblockchainplatform.Successfulinteroperabilityenablestheusertotrustthat“IknowwhatIseeiswhatyousee”withinasingleplatformaswellasacrossplatforms.MargivanGogh,HeadofSupplyChainandTransport,ShapingtheFutureofMobility,WorldEconomicForum,SwitzerlandBlockchaininteroperabilityemergedasatopicofmuchdebateatWorldEconomicForumeventsandmeetings.Typicalquestionsincluded:–Canblockchainsspeaktoeachother?–Willtheindustrygettooneglobalblockchaintorulethemall?–Whatblockchainplatformshouldweuse?–Whydon’twesimplyenhanceourcommunicationprotocolstoapplicationprogramminginterfaces?Interoperabilityenablestheusertotrustthat‘IknowwhatIseeiswhatyousee’withinasingleplatformaswellasacrossplatforms.LindaPawczuk,GlobalConsultingBlockchainandDigitalAssetsLeader,Deloitte,UnitedStatesContinuingtheseries,1thiswhitepaperlooksatoneofthecriticalsuccessfactorsofdeployment:interoperability.Thisistheseventhwhitepaperinaseriesandpartofabroaderprojectfocusedontheco-creationofatoolkittoshapethedeploymentofdistributedledgertechnologyinsupplychainstowardsinteroperability,integrityandinclusivity.2Thispaperaimstoarticulate,insimpleterms,importantblockchainanddistributedledgertechnologyconceptsastheyrelatetointeroperabilityconsiderations. ExecutivesummaryInSection1,thepaperintroducesthereadertoblockchaininteroperabilityandputsitincontext:Blockchainsolutionshavebeenformedaroundexistingsmallerecosystems,butglobaltradesupplychainsintersectwithmultipleecosystems.However,thetimeisnotyetrightforconvergenceonasingleplatformdueto,forexample,commercialsensitivities,distinctviewsontechnologychoices,differentperspectivesongovernanceandas-yetstill-developingnatureoftheblockchains,whichisultimatelywhatmakesinteroperabilitycritical.Insection2,thepaperelaboratesonthreeblockchaininteroperabilitylayers(businessmodel,platform,infrastructure)tostructurehowthereaderthinksaboutinteroperabilityrequirementswhenanalysingcompatibilitybetweenblockchainplatforms.Insection3,thepaperoutlinesthreeapproachestoachievinginteroperabilitytohelpthereaderconceptuallyunderstandwhatneedstobedonetoproceed.Insection4,thepaperintroducesaframeworkforselectingtherightapproachforblockchaininteroperability.Itcombinesthetoolsintroducedinearliersectionsandguideschoiceofapproachdependingonthecontextoftheconsortiumandthelevelofcompatibilitybetweentheplatformsinquestion.Insection5,thepaperportraysthecurrentstateofinteroperabilitysolutionsandtheirabilitytoconnectthemostcommonblockchainplatforms.Insection6,thepaperpresentstworeal-worldusecasestogivethereaderanideaaboutwheretolearnmoreandtoillustratehowthetoolspresentedinthewhitepapercanbeappliedinchoosinganapproachforblockchaininteroperability.Insection7,thepaperlistsseveralvitalquestionsstructuredaccordingtotheinteroperabilitylayersfromsection2togivethereaderastartingpointandacceleratethecollectionofinteroperabilityrequirements.Whilethispapercanbereadalone,blockchainconceptsandfeaturesarecoveredinthefirstWorldEconomicForumwhitepaperinthisseries–forfurtherreferenceseeInclusiveDeploymentofBlockchainforSupplyChains:Part1–Introduction(April2019).3Theverynatureofthetopicrequiressomeleveloftechnicalproficiency.Thispaperdoesnotexaminethemultitudeoftechnicallayers,complexities,hypotheticalsandexceptionsthatexistwithintheblockchainspace,especiallyrelatedtosignificantdifferencesbetweenpublicandprivatechains,thoughtheauthorsrecognizetheirexistenceandimportance. 1.Blockchaininteroperability–contextanddefinitionContextBlockchaintechnologyofferspromisingresults,butovercomingtheobstaclestowidespreadadoptionremainsachallenge,withthetechnologyyettoreachenterprisematurity.Moreover,manyexistingsolutionswithinsupplychainsareusingblockchainforrelativelysimpleusecases,whilerealizingthattherearenumerouspossibleopportunitiesbothwithinandadjacenttothesupplychain,asblockchainisrelevantinfinance,foodsafety,insuranceandmultipleotherindustries.Industryanalystsexpectatleastahandfulofblockchainplatformstoexistinthemarket,ontopofwhichentireecosystemsofapplicationsmayflourish.Thetimeisnotyetrightforasingleplatformdueto,forexample,commercialsensitivities,distinctviewsontechnologychoices,differentperspectivesongovernanceofblockchainnetworksandthestill-developingnatureofthetechnologies.Consequently,“inter-blockchaincommunication”,“aninternetofblockchains”and“ablockchainofblockchains”(e.g.blockchaininteroperability)havebecomehottopicstohelpensurethatvarioussupply-chainstakeholdersarelesslockedintothedesignchoicesmade.Inshort,thisexpressestheneedtosolvethechallengeofinteroperability,enablingtheusertotrustthat“IknowwhatIseeiswhatyousee”bothwithinasingleplatformaswellasacrossplatforms.Totakethenextleapswithblockchaintechnology,theinteroperabilitybetweenthechainsandtheintegrityofdatashouldbeatoppriority.JanScheele,ChiefExecutiveOfficer,BitCannaEssentially,withmultipleecosystemswithinandadjacenttosupplychainsdevelopingcompetingblockchain-basedsolutions,thepotentialbenefitsofsharedledgersandtokenizationcouldbedilutedifinteroperabilitybetweenthesolutionsortheunderlyingblockchainplatformsisnotensured.Thiswhitepaperaddressesthechallengesofachievingblockchain-to-blockchaininteroperabilityaswellasbetween“regularapplications”andblockchains.Astheformerismorechallengingthanthelatter,theprimaryweightofthiswhitepaperistowardsaddressingblockchain-to-blockchaininteroperability.Assuch,thiswhitepaperisofatechnicalcharacterinordertoshedlightontheabove-mentionedchallenges.However,itwillhighlightbothtechnicalandnon-technicalrequirementsforinteroperability.Whatwouldincentivizevendorsanduserstoworkmoreintenselytowardsfindingwaystoenableinteroperability?Thechallengeisthatoneconsortiumdesignsandimplementswhatisbestforthemgiventheusecasestheyarelookingtoaddress.Anyincentivestoensureinteroperabilitywillalwaysbesecondarytothat.Essentially,youprioritizeshort-termincentives(buildsomethingtoprovetheusecase)forlong-terminitiatives(buildsomethingthatwillworkwithneworexistingusecasesonothercomplementingplatforms).Non-technicalreadersshouldtakefromthewhitepaperthat:blockchaininteroperabilitycurrentlyispossible;thatitdependsjustasmuchongovernance,legalanddatastandardsasitdoeson,forexample,technicalrequirements;thatitiseasiesttoachieveifyouarewillingtocompromiseondecentralization;andthattechnologicaldevelopmentcontinuesatbreakneckspeed.DefinitionofinteroperabilityPutsimply,interoperabilityis:a)thecapacityofcomputersystemstoexchangeandmakeuseofinformation;andb)thecapacitytotransferanassetbetweentwoormoresystemswhilekeepingthestateanduniquenessoftheassetconsistent.Thelatterpartiswhatmakesanotherwisestraightforwardconceptcomplexinthecontextofblockchain.Ideally,blockchaininteroperabilityshouldallowknowledgetobesharedwithoutsendingcopiesofdata,andprovidefairnessintheorderingoftransactionsandaccessibilitytodataandcodificationofandadherencetocommonrules. Figure1:Blockchainsolutionshavebeenformedaroundexistingsmallerecosystems…CustomersgaindirectinsightintotheirproductsandtheirauthenticityCustomersCustomersRegulatorsRegulatorscanhaveaccesstonetworktogaininsightintotransactionsSuppliersSuppliersProcessersandfarmscanprovideinsightandinformationaboutorigin,qualitychecksanduseofproductsCustomersRetailerMinimumviableecosystemProcessingplant1SuppliersWholesalersthatmightuseingredientsinotherproductscanbothtraceandadddatatotheecosystemWholesalerProcessingplant2DistributioncentresLegendNodeoperatorNetworkparticipantsDistributioncentres,freightforwardersandothershippingorlogisticsplayerscanprovidetrustedinformationaboutshipmentsintothenetworkWholesalerBankBankscouldprovideinformationaboutpaymentverificationandexecutionFigure2:…butglobaltradesupplychainsintersectmultipleecosystemsParticipantParticipantParticipantEcosystem1ParticipantParticipantParticipantParticipantParticipantParticipantParticipantEcosystem2Ecosystem3ParticipantParticipantParticipantParticipantParticipantParticipantParticipantParticipant TwotypesofinteroperabilityBlockchain-to-blockchaininteroperabilitycomesintwotypesbeyondthatofregular,non-distributedsystems:digitalassetexchangeandarbitrarydataexchange.Mostsupply-chainusecaseswilllikelyrequirearbitrarydataexchange.Digitalassetexchange:Putsimply,digitalassetexchangeistheabilitytotransferandexchangeassetsoriginatingfromdifferentblockchains,suchascryptocurrencies,withouttrustedintermediaries(e.g.centralizedexchanges).Fromatechnicalperspective,thisfunctionalitycanbeconstructedatopblockchainsthathavefairlysimpleprogrammingcapabilities,asusersonbothsidescaneasilyproducepubliclyverifiablesignaturesforactionsthatenableatomicswapsortransfersthatcompleteonlyifbothsidesdotheirpart.Atomicswapsaresmartcontractsthatgiveyoutheabilitytoexchangedigitalassetson-chainoroff-chainseamlesslyandsecurelywithouttheinvolvementofathird-party).AnexampleismakingbitcoinspendableinEthereumdecentralizedapplications(dApps)(seeFigure3).Figure4:APIisapieceofcodethatgovernstheaccesspointtoaserverandtherulesdevelopersmustfollowtointeractwithadatabase,library,asoftwaretooloraprogramminglanguageRequestResponseWebappInternetAPIWebserverDatabase(blockchain)Figure3:Illustrationofadigitalassetexchange,whereaBitcoinisspentthroughdApponEthereumShipperBitcoininEthereumdAppConsignee Arbitrarydataexchange:Putsimply,exchangingarbitrarydataisthecapacitytodosomethingononeblockchainplatformthataffectsanotherblockchainplatform.Whatistrackedisnotnecessarilyanitemofvaluebutcouldbeanevent.Fromatechnicalperspective,thismeansmakingblockchain-to-blockchainapplicationprogramminginterface(API)calls,whichcangoasfarashavingsmartcontractcodeononeblockchainplatformverifytheconsensusfinalityofeventsonotherblockchainplatformsdirectly.Thiscapacityallowstheusedataononeblockchainplatformtoaffectstatechangesonanother.Italsoletsuscreatesyntheticversionsononechainofanassetthatishometoanotherchain,makingthatassetusableonastatemachinethatoccupiesadifferentpartofthetradespace.Asmostblockchainsarepassivesystemsunabletoproduceaverifiable-by-otherssignature,arbitrarydataexchangeisthemoredifficulttypeofinteroperabilitytoachieve.However,theusecasesenabledbyarbitrarydataexchangecanbemoreadvancedthanwhatdigitalassetexchangemakespossible.Anexampleofarbitrarydataexchangeisthechangingownershipofabilloflading(BoL)fromashipperonEthereumtoaconsigneeonHyperledger.TheBoLisadocumentoftitle.Currently,theBoListypicallyissuedfromtheoceancarriertotheshipper/sellerasproofofreceiptofthecontainerandcontainsdataon,forexample,theshipper,theconsignee,thenotifiedparty,thevesselvoyage,thevesselname,thecontainerID,goodsdescription,tradeterms,signatures,stampsandBoLnumber.Thedocumentistypicallykeptwiththeshipper/selleruntilpaymentfortheshipmenthasbeenreceivedfromthebuyer.Thedocumentcanbechangedmultipletimesif,forexample,theshipmentmissesitsroute,ifthenotifiedpartychanges,ifthebuyerchangesandtheconsigneeneedsupdating.Moreover,bankstypicallyholdacopyofthedocumentassecurityforloansinrelationtotradefinance.Figure5:Illustrationofhowownershipofthebilloflading(BoL),whichisarbitrarydata,canbetransferredfromashipperonEthereumtoaconsigneeonHyperledgerBoLonHyperledgerShipperVerificationtoEthereumthatBoLisvalidConsignee 1.ThreelayersoftheblockchaininteroperabilitymodelInteroperabilityisatopconcernfordecision-makersinterestedinbuildingblockchainsolutions.Organizationsdonotwanttofindthemselvesonablockchainplatformthatmaylimittheiroptionsforexternalcollaborationinthefuture.Theywanttobuildscalablesolutionsthatcangrowwithboththeenterpriseandtheextendedecosystemifneeded.Manyorganizationsalsowanttoremainflexibleinchangingorconnectingtodifferentsolutions.Meanwhile,othersarepreoccupiedwithhowtomaketheirexistingsystemsinteroperablewithblockchainplatforms,typicallytosubmittoorusedatafromablockchainsolution.Thissectionfocusesprimarilyonblockchain-to-blockchaininteroperabilitywhilethecomingsectionsalsocovertheformertypeofinteroperability.Theinteroperabilitymodelforblockchainsolutionsbelowconsistsofthreelayersaddressingthischallengeforthefullstackfortheblockchainsolution,includingtheunderlyingblockchainplatformonwhichitisbuilt.Itcorrespondswithtypicalblockchainarchitecture4,5andisintendedfororganizationstostructuretheireffortsto:clarifyinteroperabilityrequirements;enableblockchainsolutionstoexchangeandmakeuseoftheirdata;andselectoneofthreeapproachestointeroperability.Figure6:Blockchaininteroperabilityframeworkbreakingdownthechallengesinthreelayers:business,platform,infrastructureLayerAspectBusinessmodelGovernancemodelDatastandardizationCommercialmodelLegalframeworkPlatformConsensusmechanismSmartcontractAuthenticationandauthorizationInfrastructureHybridcloudManagedblockchainProprietarycomponentsInallthreelayers,aholisticquestionoftrustmustbeposed:DoparticipantsonblockchainplatformAfundamentallytrusttheset-upofblockchainplatformA?Iftheanswerisyes,interoperabilitywillhelpfutureproofthesolutioninquestion.However,iftheanswerisno,interoperabilitycanbeadestructiveforce,erodingtheincentiveforparticipantstoparticipateintheblockchainplatform.Rememberthatinteroperabilityisnotanindividualdecision,butadecisiontakenbyatleasttwopartiesandprobablymore.HenrikJensen,SeniorBlockchainAdviser,TrustworksBusinessmodellayerWhentwoecosystemsexchangedatawitheachother,thegovernancemodelsbehindthesetwoecosystemsshouldbecomparablewitheachother,togetherwithwell-definedlegalframeworkandcommercialarrangements;technicalfeasibilityalonecannotenableinteroperability.–Governance:Tohelpensurethetrustworthinessoftheparticipants,aprudentgovernancemodelhastobedesignedandagreedbetweenthedifferentblockchainecosystems.Forinstance,ifabankinaknow-your-customer(KYC)networkopenedanaccountforablacklistedmanufacturer,thesecondbankwouldthenfinancetheblacklistedmanufacturerbytrustingthefirstbank.Topotentiallyavoidthesekindsofsituations,averystringentonboardingprocessfortheblockchainplatformwillhavetobeinplace,sothatonlyqualifiedfinancialinstitutescancontributeKYCinformationtotheplatform,becausetheyareessentiallyconductingKYConbehalfofthewholeecosystem.Thegameischangingforcontainershipping:digitalization,regulatorycomplexity,cybersecurity,environmentalimpact.Customersaredemandingabetterexperience.Tostaycompetitive,wehavetomeetthesechallengesheadon,toevolve.Noonecompanycanmovetheindustryforwardonitsown.Collaborationisthekeytogreaterefficiencyandagilitytomeetnewdemands.Today,fragmentedsystemsareholdingusback.Withoutafoundationfortheseamless,end-to-endexchangeofinformation,thesechallengeswillgounmet.AtDigitalContainerShippingAssociation(DCSA),we’reestablishingstandardsforacommontechnologyfoundation[…]andpav[ing]thewayforinteroperabilityinthecontainershippingindustrythroughdigitalizationandstandardization.ThomasBagge,ChiefExecutiveOfficer,DigitalContainerShippingAssociation Figure7:OverviewofselectedorganizationswithafocusoncreatingstandardstodrivebusinessmodelinteroperabilityBIATheBlockchainIndustrialAlliance(BIA)seekstopromotecross-blockchaintransactionsandinterconnectivity.Thegoalofthisallianceistocreateagloballyacceptedstandardforconnectingblockchainsandtobringinnovationstogether.6BiTATheBlockchaininTransportAlliance(BiTA)isseekingtodevelopandembraceacommonframeworkandstandardsfromwhichtransportation/logistics/supply-chainparticipantscanbuildblockchainapplications.7BRIBATheBeltandRoadInitiative(BRI)hasestablishedtheBeltandRoadInitiativeBlockchainAlliance(“BRIBA”)tospurthedevelopmentoftheBRIbyleveragingblockchaintechnologies.8BSITheBritishStandardsInstitution(BSI),thenationalstandardsbodyoftheUnitedKingdomproducingtechnicalstandards,isworkingonblockchainstandardsforsupplychains.9CESITheChinaElectronicStandardizationInstitute(CESI)workswithstandardization,conformityassessmentandmeasurementactivitiesinthefieldofelectronicinformationtechnologies.Inthepastcoupleofyears,CESIhascomeoutwithavisiontointroducethreeblockchainstandardsonsmartcontracts,privacyanddepositsinabidtobetterguidethedevelopmentofblockchainindustryinthecountry.10DCSATheDigitalContainerShippingAssociation(DCSA)seekstopavethewayforinteroperabilityinthecontainershippingindustrythroughdigitalizationandstandardization.11EBPTheEuropeanBlockchainPartnership(EBP)connectscountriestocooperateintheestablishmentofaEuropeanBlockchainServicesInfrastructure(EBSI)thatwillsupportthedeliveryofcross-borderdigitalpublicservices.12EEATheEnterpriseEthereumAlliance(EEA)isamember-drivenstandardsorganizationwhosecharteristodevelopopenblockchainspecificationsthatdriveharmonizationandinteroperabilityforbusinessesandconsumersworldwide.13GS1GS1developsandmaintainsglobalstandardsforbusinesscommunications.Thebestknownofthesestandardsisthebarcode.14IEEETheInstituteofElectricalandElectronicsEngineers(IEEE)hascreatedablockchaininitiativetomaturethetechnology.15ISOTheInternationalOrganizationforStandardization(ISO)isfacilitatingaglobalcollaborationtocreatestandardizationofblockchaintechnologiesanddistributedledgertechnologies.16MOBITheMobilityOpenBlockchainInitiative,alsoknownasMOBI,isanon-profitconsortiumfundedbyitsmembersandcreatedtodefineopenstandardsfortheautomotiveindustrytodevelopandadoptblockchainatscale.17–Datastandardization:Inmanyblockchainplatforms,thevalueliesintheexchangeofvalidateddataamongparticipantsintheecosystem.Asaresult,thetrustworthinessoftherecordsinablockchainplatformdependsonthetrustworthinessoftheparticipants.Forparticipantstoshareinformation,alldatamustfollowaformofdatastandardizationtoensureitcanbeunderstoodbyallparties.Consequently,everyblockchainecosystemnecessarilystandardizesthedatarepresentationofitsentities(contracts,parties,etc.).Whenwewanttomakeblockchainplatformsinteroperable,differentstandardsmaycollidewithmissingattributes,forexample.–Legalframework:Itcanbedifficulttoascertainwho“owns”thenetworkanditsdataduetothedecentralizedcharacteristicsofblockchainplatforms,whichmakesithardtoplacewhoislegallyresponsibleforit.Inadecentralizedenvironment,itmaybechallengingtoknowwhohasprocessedwhatdata,whereandwhen,andthustoascertainwhois“responsible”forit,whatjurisdictionappliesindisputesorwhocontrolstheinformationandisliableforitssecurityorresponsibleforitsintegrity.Moreover,blockchainledgersaregenerallyappend-onlyandcannotbechangedafterthefact,whichcanraiseissuesinanumberofregulatoryspheres,suchasdataprivacyorconsumerprotection.18 Thesechallengesareonlyfurthercomplicatedinthecontextofinteroperability,asitisnowtwoormultipleblockchainplatformsthatareinquestion.–Commercial:Thecommercialmodelwillbecriticalforsuccess.IfabankinitiallytakestwohourstoconductKYCand,basedonthatrecord,asecondbankcanthenopenanaccountforthesamecustomerinafewminutes,thesecondwouldhavetopaythefirstbankback,otherwisethefirstbankwouldnevercontributetheKYCrecord.However,commercialmodelswillinevitablybedifferentindifferentblockchainecosystems.Makingblockchainsinteroperablecouldintroducearbitrageopportunities,forexample.Thismaynotbebad,butsomeparticipantsmightnotlikeit.PlatformlayerFortwoblockchainplatformstobeinteroperable,itmustbeconsideredwhethertheirplatformlayersaretechnicallycompatible,whilekeepingthefollowinginmind:–Consensusmechanism:Differentconsensusmechanismsthatareinherentlydifferent(e.g.proof-of-work(PoW),proof-of-stake(PoS)andRaft)arenotinteroperablebydefault.Blockchainplatformsthatusethesameconsensusmechanismcanbeinteroperable.However,eveniftwoplatformsusethesameconsensusmechanism,itcanbedifficulttosynchronizedataacrossplatformswithconsensusabouttheorderofthosedatatransactions.Forexample,HyperledgerFabricandCordamaybothuseRaftastheconsensusmechanism,buttheyusedifferentmodelsforhowdataisstored,howitpersistsandwhoparticipatesintheconsensus.–Smartcontracts:Differentblockchainplatformsmayusedifferentlanguagesforsmartcontracts,fromTuringincompleteBitcoinscripttoTuringcompleteJavacodewithlegalproses.Asaresult,sharingcodifiedlogicsforautomatedcontractexecutionsisusuallyinfeasibleacrossheterogeneousblockchainplatforms.–Authenticationandauthorization:Blockchainscansupportmultisignaturetransactions,allowingmultipleparticipantstodigitallysignonthesametransaction.Yetthisisdesigneddifferentlyacrossblockchainplatforms.Forinstance,HyperledgergenerallyallowssigningatuserlevelwhileCordadoessoatnodelevel.Theauthenticationandauthorizationarehencenotinteroperableacrosssomeblockchainsdespitetheirsimilarconsensusmechanisms.Consequently,interoperabilitymethodsmustrelyoncross-authenticationmechanisms.Thesemechanismscouldrangefromsimplestorageofencryptedpasswordstoanoverlayinguserauthenticationontopoftheblockchainplatforms.InfrastructurelayerTheinfrastructurelayerdealswithsetsofcomponents,enablingtheservicesoftheblockchainplatform;thesetypicallyinclude,withoutbeinglimitedto:compute,storage,networkandvirtualization.Whiletheinteroperabilitychallengegenerallyliesinhavingcompatibleinfrastructures,itisoftencomplicatedduetoproprietycomponentsofferedbycloudproviders.–Hybridcloud:Theoretically,anecosystemcandeployablockchainplatformonhybridinfrastructures,becauseblockchainisadistributedsystem.Forpublicblockchains,machines–fromhomecomputerstolargeserverfarmswithhypercomputingpower(HPC)–canbecomeadatanodeandparticipateinablockchainecosystem.However,thesenetworksareusuallynotsufficientlyhighperformingforenterprise-gradesolutions,andtheirlackofgovernancemodelscreatesvulnerabilities,whichcanbeexploitedfor,forexample,moneylaunderingandbreachofcurrencycontrols,etc.Thesechallengesareexacerbatedwhenattemptingtomaketwosolutionsinteroperable.Therefore,mostenterprisesoptoutofhybridcloudsfortheirblockchaininfrastructures.–Managedblockchains(BaaS):formanagedblockchainasaservice(BaaS)solutions,thechallengeliesinthehiddencontrolcloudprovidershaveoverthesolution,limitingtheoptionsforinteroperability.Whilemostcloudprovidersclaimthattheblockchainservicestheyareofferingareopen-sourced,therearealwayssomecomponentsintheservicesthatareproprietybased.Thisimpliesacertaindependencyonthevendorforpartoftheblockchainarchitecture.Itcouldbeanordererhostedcentrallybythecloudprovider,amembershiponboardingtool,aspecialaccessmanagementmethodoraninnovativesecurity-managementdesign.–Proprietarycomponentsinprivateblockchains:Privateblockchainsarealwayspermissionedanddiffergreatlyfrompublicblockchains–especiallyintermsofinfrastructurerequirements.Theyarenotdemandingoncomputingpowerandelectricityconsumptionandcanachievehighperformanceintransactionprocessing.Asaresult,theycanbedeployedintraditionaldatacentresor,moreoften,onvirtualprivateclouds.Blockchaindatanodesdeployedindifferentgeographicallocationsondifferentnetworksegmentscaneffectivelyexchangedatathroughtheinternet,especiallybecausenetworklatencyorintermittentdisruptionswillnotaffecteventualdataconsistency.Theinteroperabilitychallengeforprivateblockchainsliesinfindingprivateblockchainsthathavesufficientlysimilarcharacteristics. 1.InteroperabilityapproachesThreeapproachesuniquetoblockchaininteroperabilityexist.Eachapproachcomeswithprosandcons,andtheirusabilitydependsonthetypesofsystemsbetweenwhichonewishestoachieveinteroperability;thisrequiresorganizationstobeawareofallthreeapproachesbeforechoosingone.Figure8:ThreeapproachestoblockchaininteroperabilityCOACross-authenticationOracleAPIgatewayApproach1:Cross-authenticationThreetechnicalmethodsforinteroperabilityexistwithinthecross-authenticationapproach:Pros:Onlyapproachthatcanenableblockchaininteroperabilitywithoutusingacentraltrustedparty(notaryschemesnotincluded).Cons:Onlyrelaysandnotaryschemessupportthearbitrarydataexchangetypeofinteroperability,typicallyneededformoreadvancedusecaseswithinasupplychain.Also,relaysinparticularareyettoseewidespreadadoptionforenterpriseuse.Notaryschemes:Executedbytrustedparties(notaries)thathelpparticipantsonblockchainAconfirmthatsomeeventoccurredonblockchainBandviceversa.ThenotarieswillcometoagreementthroughsomeformofconsensusalgorithmandwillthenissueasignaturethatcanbeusedtofinalizeatransactiononchainA,conditionalonthisconsensus.Notaryschemesareoneofthesimplestwaystoachievethefullsuiteofcross-chaininteroperability.However,theycentralizetrust,whichgoesagainstthemainparadigmofblockchain,namelydecentralization.Thisconsequencemightbeacceptableinsituationswhereblockchainconsortiamemberscanagreeonacentralpartytooperatethenotaryscheme.Ultimately,iftheusecasereliessolelyontheimmutabilityofthedistributedledgeranddoesnotneedtoreplaceinstitutionaltrustinacentralpartywithasystemictrustthroughdecentralization,anotaryschemeshouldbeconsideredasaviableoption.Multipleenterpriseusecasesonpermissionednetworkswouldfallinthiscategory.Relays:Systemsinsideoneblockchainplatformthatcanvalidateandreadeventsand/orstatesinotherblockchainplatforms.Morespecifically,arelayisacontractonblockchainplatformAthatfunctionsasalightclientofblockchainplatformB,usingblockchainplatformB’sstandardverificationproceduretoverifyblockheadersfedintothecontract.ThisgivesblockchainplatformAthecapacitytounderstandeventchangesonblockchainplatformB,withoutusingatrustedparty.Astherelaywouldallowasecuremessagetopassbetweenthetwoblockchainplatformsinquestion,itcanalloweachblockchainplatformtoexecutetransactionsonitsownstatemachineusingthesyntheticversionsofassetsfromtheotherblockchainplatform.Thedownsideisthatitisverydifficulttoconnectblockchainplatformsthatdon’thavethedesiredorsimilarcharacteristics.Forrelaystoworkbest,theblockchainplatformsshouldsharecertaincharacteristics,includingflexiblemultisignaturecapabilityandfastconsensusfinality.Hash-locking:SettingupoperationsonblockchainplatformAandblockchainplatformAthathavethesametrigger,usuallytherevelationofthepreimageofaparticularhash.Thisisthemostpracticaltechnicalmethodtointeroperabilityincross-authenticationbutisalsothemostlimitingintermsoffunctionality,supportingonlydigitalassetexchange.Twogeneraltypesofhash-lockingexist:on-chainhashedtime-lockcontracts(HTLC)andoff-chainhashedtime-lockagreements(HTLA).AnHTLCison-chainandisaclassofblockchain-basedpaymentthatuseshashlocksandtimelockstorequirethereceiverofapaymenttoeitheracknowledgereceiptpriortoadeadlineorforfeittheabilitytoclaimthepayment,returningittothepayer.HTLCsallowforcross-chainatomicswapsandfullyfundedbidirectionalpaymentchannelsbetweenassetsoncertaintypesofblockchainplatforms.AnalternativesolutionisHTLAoverapeer-to-peernetworkthatisusedforcryptocurrencypaymentsacrossdifferentblockchainplatforms.UnlikeHTLCs,thissolutionisnotbuiltasasmartcontractontheblockchainplatformbutanoff-chainsolution.Hence,itdoesnotprovidethesameinbuiltdecentralizedcharacteristicasHTLC.Overviewofindustrysolutionsincross-authenticationSeveralcompanieshavereleasedinteroperabilitysolutionsthatareatvaryinglevelsofmaturity.Thesehavebeenmappedaccordingtothetechnicalmethodspresentedabove.Mostsolutionsfocusondigitalassetexchangeandthusofferlimitedfunctionalityforarbitrarydataexchange.Therelaymethodismostpopularamongstart-ups,whileenterprisesolutionshavefocusedonhash-locking. Figure9:InteroperabilitysolutionsreleasedbymultiplecompaniesandmappedoutaccordingtothethreetechnicalmethodspresentedaboveNotaryschemesRelayHashedtime-lockcontractContractson-chainQuantAIONWanchainPOABTCRelayBitcoinLightningnetworkMultisignatureLiquidbyblockstreamICONARKBLOCKNETPolkadotCosmosBlockColliderMetronomeAgreementsoff-chainInterledgerHyperledgerQuiltR3CordaSettlerApproach2:APIGatewayAnapplicationprogramminginterface(API)isapieceofcodethatgovernstheaccesspointtoaserverandtherulesdevelopersmustfollowtointeractwithadatabase,library,softwaretoolorprogramminglanguage.Pros:Triedandtestedtechnology–easytoimplement.Cons:MaynotguaranteeeventualdataconsistencyandcentralizestrusttowhoeveroperatestheAPIs.AnAPIgatewayorganizesseveralAPIs.Itistheconductorthatorganizestherequestsbeingprocessedbytheunderlyingarchitecturetosimplifytheexperiencefortheuserortheprocessofrequestingforaclient.Itisatranslator,takingaclient’smanyrequestsandturningthemintojustone,toreducethenumberofroundtripsbetweentheclientandapplication.Giventhechallengesintroducedinthecross-authenticationapproach,interoperabilitysolutionsarehardtoachievethroughsmartcontractsinrelayandhash-locksolutions.Also,giventhechallengesintroducedintheplatformlayer,fewblockchainplatformsarefitforinteroperabilitysolutions.Therefore,organizationsmayopttouseanAPIapproach,whereAPIsareusedinanadditionalexternallayerontopoftheblockchainplatform.Yet,thechallengeherecanbethattheAPIstendtobedrasticallydifferent,notsufficientlyhighlevelandspeakthelanguageoftheunderlyingblockchainnotthelanguageofthebusiness.AnotherproblemwhenusingtheAPIapproachisthatitmaynotbeabletoguaranteeeventualdataconsistencyacrossthetwoblockchainplatforms,meaningthatitmaynotbepossibletoguaranteethatnonewupdatesaremadetoagivendataitem.Moreover,itcentralizestrusttowhoeveroperatestheAPIs. Figure10:OverviewofanAPIinteroperabilitysolution.ThereisatendencyforblockchainplatformintegrationstouseanexternalAPIlayerfordataexchangeandevent-triggeredlogicexecutionasopposedtousingasmartcontract(seeApproach1:cross-authentication)BankCorporateCarrierconsortiumForwarderTerminalShipperAPITradefinanceplatformCloudCloudNon-DLTplatformOnpremiseAPIERPUIAPILogisticssystemUIDLTnodeSmartcontractLogisticssystemUIDLTnodeDLTnodeSmartcontractAPILogisticsapplicationsUIDLTnodeSmartcontractSmartcontractAPIAPITradeapplicationCorebankingsystemUIUIWherebothAPIgatewayandcross-authenticationareshown,onlyoneofthetwoapproachesshouldbeappliedOracleAPIgatewayCross-authenticationLegend:Pros:Provenandeasy-to-implementsystems.Oraclesprovideadatafeedaboutexternalevents.Cons:Donotcreateactualblockchain-to-blockchaininteroperability;theymakeblockchainsinteroperableonlywithnon-blockchainsystems.Applicationsareonlyasreliableandtrustedastheiroraclesare.Approach3:OraclesAnoracleisanagentthatenablesthetransferofexternaldatatotheblockchainforon-chainuse.Thisisdoneusingsmartcontractsthataddinformationaboutreal-worldeventstotheblockchain.Simpleexamplesofdatathatareusefultoimportincludetemperatures,pricesorinformationaboutflightdelays.Onceenteredontheblockchain,thisdatacanbeusedtoautomateprocessesbasedonreal-worldevents(e.g.ifatrainisdelayed,aninsurancecontractautomaticallyandautonomouslydeliverstheindemnification).Technicallyspeaking,oraclesarenodifferentfromothersmartcontracts.However,inordertobeuseful,oraclesneedtobetrusted,eitherbecausetheyareoperatedbyatrustedthirdpartyorthankstocryptographicattestations. 1.PickingtherightapproachWhenorganizationsneedtodecideonaninteroperabilityapproachtogoby,theyneedtounderstandtwodimensions.First,theyneedtounderstandthebusinesscontexttheyarecomingfrom,whichcanbesplitintofourtypesofconsortia.Second,theyneedtounderstandthesystemtheywishtobecomeinteroperablewith,splitintothreetypes.Tounderstandthissystem,organizationsshouldusethethreelayersintheblockchaininteroperabilitymodeltounderstandwhetherthesystemisacompatibleblockchain,anon-compatibleblockchainoranon-blockchainplatform.Whenthisisclear,organizationsshouldnowknowwhichofthethreeinteroperabilityapproachestopick.If,forinstance,anorganizationistryingtomakeablockchainplatformsolelydealingwithfinancialtransactions(digitalassetexchange)andwishestobecomeinteroperablewithablockchainplatform,whichthroughanalysisofthethreelayersintheblockchaininteroperabilitymodelturnsouttobefundamentallydifferent(non-compatibleblockchainplatform),thentherightapproachwillbetheAPIgatewayapproach.Toassistorganizationsinmakingdecisionsininteroperabilityapproaches,thefollowingintroducesthreetypesofsystemstoconnectto,andfourtypesofconsortiaasthebusinesscontextforinteroperabilityneeds:19Figure11:Fourcontext-dependentapproachestoblockchaininteroperabilityBusiness–financialconsortiumGovernmentconsortiumBusiness–non-financialconsortiumTechnologyconsortiumOracleAnoraclemakesitpossibletotransferexternaldatatotheblockchainplatformforon-chainuse.Thisisdoneusingsmartcontractsthataddinformationaboutreal-worldeventstotheblockchainplatform.Onceenteredontheblockchainplatform,thisdatacanbeusedtoautomateprocessesbasedonreal-worldeventsNon-blockchainplatformapproachwillbethelastresort,whichmaynotbeabletoguaranteeeventualdataconsistencyAPIgatewayWhentwonon-compatibleplatformshavetoexchangedata,theAPICross-authenticationWhentwoblockchainplatformsareinteroperable,theonlychallengeistoresolvecross-authenticationCompatibleblockchainplatformNon-compatibleblockchainplatform TypesofsystemsThefollowingthreetypesofsystemsexist:–Non-blockchainplatform:Systemsthatdonotuseblockchaintechnologiesandthereforehaveinherentlydifferentinfrastructureset-upsfromblockchainplatforms.–Compatibleblockchainplatform:Blockchainplatformsthataretechnicallycompatibleforallthreeinteroperabilitylayers.–Non-compatibleblockchainplatform:Blockchainplatformsthatsharesomefeatureswiththeblockchainplatforminquestionbutwithoutsufficientlysimilarcharacteristicswhenanalysedusingthethreeinteroperabilitylayers.TypesofconsortiumThefollowingfourtypesofconsortiaexist:–Business–financialconsortium:Focusingprimarilyondigitalassetexchanges,whichmaylimittheneedforarbitrarydataexchanges.–Government-driven:Contextswheregovernmentbodiesneedtocontroltheblockchainplatforminquestion,whichputsadditionalrequirementsforalllayersofinteroperability,limitingtheoptionsforinteroperabilitychoices.Thistypeofconsortiummayhavetheneedforbothdigitalassetexchangeandarbitrarydataexchange.–Business–non-financialconsortium:Typicallyhastheneedtoexchangearbitrarydataformoreadvancedusecases.Thiscategoryoftenincludessupplychainconsortia.–Technologyconsortium:Thesearealsoprovidersofthetechnologiesenablingblockchainplatforms.Therefore,theyarerarelytechnicallycompatiblewithblockchainplatformsfromotherconsortiaregardlessoftherequireddataexchanged. 1.CurrentstateofinteroperabilitysolutionsLandscapeforblockchain-to-blockchainsolutionsTheinteroperabilitylandscapeforblockchain-to-blockchainsolutionsremainsimmatureforenterpriseuse.MostsolutionsfocusonBitcoinandEthereum,andlittleactivityhasbeenobservedonthepermissionedblockchainplatforms.Moreover,theinteroperabilitychallengesstemmingfromthebusiness-modellayerdiscussedabovemeanitisachallengethatisdifficultfortechnologyproviderstosolvealone.Intermsofthethreetechnicalmethodsinthecross-authenticationapproach,someworkingsolutionsdoexist,butenterpriseadoptionremainslimited.Notaryschemeshaveseenlimiteduseandhavesofarbeenobservedonlyforcryptoexchangesettlement.Thehashedtime-lockagreements(especiallyfortokenswaps)usedbetweenpermissionlessblockchainssuchasEthereumandBitcoinhavebeenusedforinteroperabilitybetweentheCordaandRippleledgers.RelayshavethusfarbeenusedonlyforpermissionlessblockchainplatformsandnonehassucceededincreatinginteroperabilityforblockchainplatformsotherthanBitcoinandEthereum.HederaHashgraphrecentlyannouncedtheHederaConsensusService,whichappearspromisingforblockchain-to-blockchaininteroperabilityanddetailshowaglobal,fault-tolerantandcost-effectiveorderingservicecanbemadeavailabletoanyHyperledgerFabricnetworkbuilttoday.20Inshort,thereisdemandforadistributedandfastwaytoreachconsensuswithoutcentralizingtheconsensusprocessand,whilewidespreadadoptionisyettotakeoff,anumberofactorsareworkingonmakingitareality.LandscapeforAPIsolutionsAPIisatechnologytypealreadyseeingwidespreaduseandisusedbothforblockchain-to-blockchaininteroperabilityandforinteroperabilitysolutionsbetween“regularapplications”andblockchainplatforms.Hence,APIsolutionsgenerallyhaveahighdegreeofmaturityandareeasytoimplementforblockchain-to-blockchaininteroperability,comparedtocross-authentication.However,solutionsare,insomecases,stillrelativelyimmatureandcomewiththelossofdecentralizationalongwithotherchallenges,whicharefurtheraddressedinthesectiononAPIgateways.Figure12:Documentedinteroperabilitybetweenindividualblockchaintechnologiesorinteroperabilitysolutions.PartiesthatclaimtobeworkingonestablishinginteroperabilitybuthavenotyetpresentedworkingsolutionsarenotshownPolkadotCosmosAIONCordaEthereumPOAHyperledgerICONr3CordaSettlerBTCRelayARKInterledgerWanchainHyperledgerQuiltRippleBitcoin APIsolutionsarecommoninthemarket.AllblockchainplatformsinthemarkettodayhaveAPIsforintegrationwithnon-blockchainapplicationsandareworkingonsolutionsthatallowforinteroperabilitywithotherblockchainplatforms.Thoughalloftheplatformsbelowhaveannouncedthisfunctionality,onlylimitedresultshavebeenpublishedtoproveanymaturity.Thisindicatesthatblockchainplatformsaregenerallyawareoftheinteroperabilityneedbutarestillinanimmaturestate.Figure13:ExampleofthreeplatformsandtheirAPIsusedforlegacyintegrationBlockchainEthereumHyperledgerCordaBlockchaintonon-blockchainJSON.RPCAPIHyperledgerComposerAPIJSONAPIBlockchaintoBlockchainOpenstandards-basedframeworkHyperledgerQuiltCordaSettlerNoneofthelargetechnologyvendorssupportingblockchainhaslaunchedinteroperabilitysolutionsexceptforMicrosoft,whichiscurrentlyworkingonaprojectwithNasdaqtocreatealedger-agnosticsolution.Figure14:Overviewoflargetechnologyvendors’supportforblockchaininteroperabilityVendorSupportedblockchainsInteroperabilitywithnon-blockchainInteroperabilitywithotherblockchainIBMHyperledgerFabricIBM®MQforz/OS®forhybridcloudtransformationMentionssmartcontractsandreliesonthepartnershipbetweenHyperledgerandEEA.Expecta“mashup”applicationtosolvetheisolatednetworks,givingorganizationsoneconsistentAPIcoveringallnetworks.Alsoclaimsinteroperabilitycanbemetthroughvendorofferings.PartiallyusesGS1standards.TheadoptionoftheHederaConsensusServicecouldbeaviablepathtowardsinteroperabilitywithotherblockchains.MicrosoftHyperledgerFabric,Corda,EthereumandmoreAzureBlockchainWorkbenchRESTAPIIsworkingwithNasdaqtocreatealedger-agnosticsolutionfortheNasdaqFinancialFramework,enablingNasdaqcustomerstousedifferentblockchainsthroughonecommoninterface.IntendstouseGS1standards.21SAPHyperledgerFabric,MultiChainandQuorumIntegratesSAPsolutionstoblockchainsviaaSAPcloudserviceandablockchainadapterSAPisconstantlyevaluatingwhichprotocolstosupport,basedoncustomerneeds.Forexample,SAPhasdevelopedinteroperabilitywithR3Cordatodemonstratereal-timegrosssettlementinbanksforcentralbankers.Inaddition,inordertoachieveinteroperabilitybetweenblockchainprotocolsandusecases,SAPisworkingonstandardizationonthetechnicallayer,suchastheToken-Taxonomy-FrameworkandsemanticalstandardizationslikeGS1.ORACLEHyperledgerFabricAccessiblefromcloudandon-premapplicationsviaRESTAPIsandHyperledgerSDKsInteroperablewithnon-OracleversionsofFabricusingcompatiblereleases. 1.InteroperabilitycasestudiesThefollowingsectionprovidesdetailsonhowblockchaininteroperabilityhasbeenachievedintwospecificcases.ThefirstcaseappliesacombinationofelementsfromtheoracleapproachandtheAPIgatewayapproach,asitisachievinginteroperabilitybetweentwoblockchainplatformsthatarenon-compatible(EthereumandHyperledgerFabric)andanon-blockchainplatform(SingaporeExchange).Thesecondcasefocusesondatatypicallybeingsupply-chainevents.Hence,theprimaryneedisarbitrarydataexchange.Asthesolutionisnotexclusivetocertainblockchainplatforms,itisnotpossibletoassurethecompatibilityoftheblockchainplatformsinquestion.However,thesolutioniswellsuitedtopotentiallyincompatibleblockchainplatformsandrelatestotheAPIgatewayapproach.Deloitte22connectingHyperledgerFabricandEthereumwithSingaporeExchange(SGX)andMonetaryAuthorityofSingapore(MAS)vianodeintegrationDeloittehasconnectedHyperledgerFabricandEthereumwithSingaporeExchange(SGX)andMonetaryAuthorityofSingapore(MAS),thecentralbankofSingapore.23Theobjectivewastoreducetheturnaroundtimeofthedelivery-versus-payment(DvP)processfromT+2toT+0,lowertheriskofcounterpartiesandreducetheliquidityrequiredintheecosystem.Thedeliveryleg–i.e.thetransferoftitleofthesecurities–wasexecutedonthepermissionedHyperledgerFabric,whilethepaymentlegusingthecentralbankdigitalcurrencynamedUbin,eachcoinbackedwithoneSGD,wasrunningoncrypto-enabledEthereum.BothFabricandEthereumareopen-sourcedandwidelyadopted,andaremostsuitablefordeliveryandpaymentrespectively.Thechallengewashowtointegratethesetwoblockchaintechnologiestogether.Deloitteusedthesmartcontract(chaincode)ofHyperledgerFabrictotriggerpaymentattheEthereumnetworkuponthechangeoftitleofthesecurities.ThesellerfirstreceivesasecretfromtheSGXservertolockthesecuritiesonHyperledgerFabric,whichinturnvalidatestheownershipofthesecuritiesagainsttheseller.TheSGXserverthenissuesanothersecrettothebuyertolocktheirpaymentonEthereum,andtheevent-triggeredsmartcontractwillexchangethesetwosecretsbetweensellerandbuyersimultaneously,sotheycanunlockandreceivethepaymentandsecuritiesrespectively.Thiseliminatestheneedforintermediatessuchascustodians,traditionallyrequiredtomitigatecounterpartyrisk.Thedesignrequiresinteroperabilitybetweenthetwomostwidelyadoptedpermissionedandpermissionlessblockchainplatforms,andDeloittehasproventhattheycanbetightlyintegratedthroughsmartcontracts.Infact,EthereumPantheonClienthasalreadybecomepartoftheHyperledgersolutionnamedBesu,supportingseveralconsensusalgorithms.EVRYTHNGconnectingmultiplechainsviaAPItodigitizeproductsTheEVRYTHNGProductCloudgivesproductsadigitalidentity.Putsimply,ittransformsaphysicalitemintoadigitalobjectthatexistsandinteractsontheweb.Auniqueproductisgivenaserializeddigitalidentity,ortwin,inthecloud,whichislinkedtoanidentifierembeddedinthesmartpackagingorsmartcode.Thisenablesthephysicalobjecttobescannableandinteractive,andgivensoftwareintelligencetoparticipateinnewapplications.Thisprocesshelpstoresolvesupply-chainintegrityissues(e.g.backdoorgoods,counterfeitgoods,parallelimports,etc.)andenablesnewdirect-to-consumerapplicationstriggeredbyendcustomersscanningproductswiththeirsmartphones.EVRYTHNGoffersanAPIgatewaycalledtheBlockchainIntegrationHub(decentralizedplatform).Theserviceenablesdataaboutproductstobereplicatedto,orcollectedfrom,differentblockchains.Thisdatatypicallyconsistsofevents(e.g.supply-chainhistory,livetrackingdata,consumerscans,etc.)andmetadataaboutaproducttobeupdated(e.g.temperature,humidity,currentowner,etc.).Itiscomprisedofpackagedopen-sourceconnectorsforeachblockchainrunningEVRYTHNG’srulesengine,calledReactor.ThesecustomscriptsrunsecurelyandatscaleforanyeventssenttotheEVRYTHNGProductCloud,translatingthesetransactionsfromtheEVRYTHNGmodel(basedontheW3CWebofThingsmodelandtheGS1EPCIS,DigitalLinkandidentifiersstandards)tothemodelsusedbyEVRYTHNG’sblockchainpartners.Transactionsarethenpushedtotheselectedblockchain(s)viablockchainnodeshostedbyEVRYTHNG,whichactaspartofthedecentralizednetworkofeachplatform.EVRYTHNGusuallymanages,securesandscalesthesenodesforitscustomers,buttheymayalsochoosetooperatetheirownnodes.ThescriptreceivesbackatransactionhashthatitstoresontheEVRYTHNGProductCloud.ThetransactioncannowbeleveragedbyappsusingboththeEVRYTHNGplatformAPIandtheAPIsoftheblockchainplatforms.Whiletheapproachdoesintroduceacentralizedcomponent(anAPIgateway),itallowsbrandstouseanumberofthebenefitsofblockchainsinastraightforwardmanner.Inparticular,itisusedtoallow:–Decentralizeddatasharing,ensuringthatnosingleactorhasfullcontrol,asdataandrulesareshared–Verifiableandimmutableprovenanceandauthenticityevents–Token-basedloyalty,whereconsumerrewardsareattachedtospecifictransactions,suchaspurchasingorrecycling 1.ChecklistforinteroperabilityrequirementsBelowisachecklistintendedtoassistorganizationsinstructuringtheireffortstoclarifyblockchaininteroperabilityrequirements.Thechecklistisstructuredaccordingtotheblockchaininteroperabilitymodelpresentedearlier,whichsplitsinteroperabilityintothreelayers.Thechecklistmaybeusedtoclarifyrequirementsforeachofthethreelayersandbringsupquestionstoconsiderbeforeengagingindevelopingablockchainsolutionforinteroperabilitypurposes.BusinessinteroperabilityWhichindustriesandassociateddatastandardsdotheseparticipantsconformto?Doanyoftheseparticipantsparticipateinanexistingblockchainecosystemand,ifso,whatdatastandardsarebeingused?Howshouldparticipantsdiscover,exchangeandmakeuseofrelevantdistributeddataacrossdifferentecosystems:e.g.supplychainandtradefinance?Doesthedesirableusecaserelyonfeaturessupportedbyadjacentecosystems:e.g.Doesthesupply-chainusecaserequirepaymentsortradefinancefeaturestobedesirable?Howcantheinherentinteroperabilityrisks(exposureofinformationtodistrustedthirdparties,lossofaccesstoinformationonsecondarychain,etc.)beavoidedormitigated?PlatforminteroperabilityDoanyoftheseparticipantsparticipateinanexistingblockchainecosystemandifsowhatblockchainplatformaretheybuiltonandwhichconsensusmechanismdoestheecosystemrelyon?Dotheblockchainplatformshavesupportforsimilarmultisignaturetransactionsforauthenticationandauthorization:e.g.Doesoneblockchainplatformsignatuserlevelwhiletheothersignsatnodelevel?Isitpossibletocreateacross-authenticationmechanism?Assuminganotary-scheme-basedinteroperabilitysolution,isitaviableoptiontotrustathirdpartytorunanotaryschemetofacilitatecross-chaininteroperability,ordoesitruncountertothedecentralizationagendabeingpursuedinthefirstplace?Assumingarelay-basedinteroperabilitysolution,whywerethetwoecosystemsbuiltondistinctblockchaintechnologiesinthefirstplace?Subsequently,howcantheparticipantsintheapplicationlayersoftwodifferentblockchainstrustoneanothergiventhatthefirstchainusesoneconsensusmechanismandonegovernancemodelthatwaschoseninsteadofthealternativeconsensusmechanismandgovernancemodelemployedbythesecondchain?IsitpossibletocreateanAPIgateway?InfrastructureinteroperabilityWilltheusecaseexposethesolutionownertoregionallegalconstraintswithregardstoe.g.datastoragelocation?Doestheusecaseallowthesolutionownertodeployyoursolutiononavirtualprivatecloud?Doestheusecaseallowthesolutionownertouseblockchain-as-a-serviceofferings?IstheITorganizationmatureenoughtodepartonajourneyofhostingnodes,walletsandsecurekeys,oreventomanagetokens? GlossaryApplicationprogramminginterface(API)Anapplicationprogramminginterface(API)isapieceofcodethatgovernstheaccesspointtoaserverandtherulesdevelopersmustfollowtointeractwithadatabase,library,softwaretoolorprogramminglanguage.ConsensusmechanismConsensusmechanismsensureconvergencetowardsasingle,immutableversionoftheledger.Theyenableactorsonthenetworktoagreeonthecontentrecordedontheblockchain,takingintoconsiderationthefactthatsomeactorscanbefaultyormalicious.Thiscanbeachievedbyvariousmeans,dependingonthespecificneeds.Themostfamousconsensusalgorithmsincludeproof-of-work,proof-of-stakeandproof-of-authority.HashAhashistheresultofafunctionthattransformsdataintoaunique,fixed-lengthdigestthatcannotbereversedtoproducetheinput.Itcanbeviewedasthedigitalversionofafingerprint,foranytypeofdata.Knowyourcustomer(KYC)KYCistheprocessofabusinessoranetworkverifyingtheidentityofitsclientsandassessingtheirsuitability,alongwiththepotentialrisksofillegalintentionstowardsthebusinessrelationship.NodeAnodeisacomputerrunningspecificsoftwarethatenablesthatcomputertoprocessandcommunicatepiecesofinformationtoothernodes.Inblockchains,eachnodestoresacopyoftheledger,andinformationisrelayedfrompeernodetopeernodeuntiltransmittedtoallnodesinthenetwork.RaftRaftisaconsensusalgorithmdesignedasanalternativetoPaxos(claimedtobeeasiertounderstand)andanalgorithmforimplementingafault-tolerantdistributedsystem.24SignatureSigningamessageoratransactionconsistsinencryptingdatausingapairofasymmetrickeys.Asymmetriccryptographyenablessomeonetointerchangeablyuseonekeyforencryptingandtheotherkeyfordecrypting.Dataisencryptedusingtheprivatekeyandcanbedecryptedbythird-partyactorsusingthepublickeytoverifythemessagewassentbytheholderoftheprivatekey.SmartcontractSmartcontractsarepiecesofcodestoredontheblockchainthatwillself-executeoncedeployed,thususingthetrustandsecurityoftheblockchainnetwork.Theyenableuserstoautomatebusinesslogicandthereforeenhanceorcompletelyredesignbusinessprocessesandservices.TransactionTransactionsarethemostgranularpiecesofinformationthatcanbesharedamongablockchainnetwork.Theyaregeneratedbyusersandincludeinformationsuchasthevalueofthetransfer,addressofthereceiveranddatapayload.Beforesendingatransactiontothenetwork,ausersignsitscontentsbyusingacryptographicprivatekey.Bycontrollingthevalidityofsignatures,nodescanfigureoutwhoisthesenderofatransactionandensurethatthetransactioncontenthasnotbeenmanipulatedwhilebeingtransmittedoverthenetwork. ContributorsTheWorldEconomicForum’sCentrefortheFourthIndustrialRevolution“RedesigningTrust:BlockchainforSupplyChain”projectisaglobal,multi-industry,multistakeholderendeavouraimedatco-designingandco-creatingframeworkstoencourageinclusiveandwell-thought-throughdeploymentofblockchaintechnology.Theprojectengagesstakeholdersacrossmultipleindustriesandgovernmentsfromaroundtheworld.Thiswhitepaperisbasedonnumerousdiscussions,workshopsandresearchandthecombinedeffortofallinvolved;theopinionsexpressedhereinmaynotnecessarilycorrespondwiththoseofeverypersoninvolvedwiththeproject.Sincerethanksareextendedtothosewhocontributedtheiruniqueinsightstothisreport.WearealsoverygratefulforthegenerouscommitmentandsupportofDeloitteandtheirfellowattheCentrededicatedtotheproject.LeadauthorsLindaPawczuk,GlobalConsultingBlockchainandDigitalAssetsLeader,Deloitte,USAJesperMathiasNielsen,Manager,Deloitte,DenmarkPaulKwanHangSin,ConsultingPartner,Deloitte,ChinaNadiaHewett,ProjectLead,BlockchainandDigitalCurrency,WorldEconomicForum,USAContributorsAbdulhakimAl-Habib,SystemsConsultant,SaudiAramco(andWorldEconomicForumFellow),USAMikkelBodingKildetoft,Consultant,Deloitte,DenmarkShelbyBotula,ProjectCoordinator,WorldEconomicForum,USASigridLucieEffersøeSømod,SeniorConsultant,Deloitte,DenmarkSoichiFuruya,SeniorResearcher,Hitachi(andWorldEconomicForumFellow),USADominiqueGuinard,Co-FounderandChiefTechnologyOfficer,EVRYTHNG,SwitzerlandLucyHakobyan,HeadofProgram,MobilityOpenBlockchainInitiative,USAHenrikHvidJensen,SeniorBlockchainAdviser,Trustworks,DenmarkFrancisJee,WorldEconomicForumFellow,USAYusukeJin,SeniorResearcher,Hitachi,USAAnastasiaKuskova,TransformationandSustainabilityDirector,EurasianResourcesGroup,TheNetherlandsWolfgangLehmacher,SupplyChainandTechnologyStrategist,Independent,HongKongNakulLele,ConsultingManagingDirector,Deloitte,USAMoritzPetersen,SeniorResearcher,KühneLogisticsUniversity,GermanyDirkSiegel,Partner,Deloitte,GermanyJasonSpasovski,SeniorConsultant,Deloitte,DenmarkSergeyTyan,StrategyDirector,EurasianResourcesGroup,TheNetherlandsSheilaWarren,HeadofBlockchain,DigitalCurrencyandDataPolicy,WorldEconomicForum,USARasmusWintherMølbjerg,Director,Deloitte,Denmark