Summary and conclusions

• Author: Bellia, M.; Kounelis, I.; Anderberg, A.; Calès, L.; Andonova, E.; Pólvora, A.; Petracco Giudici, M.; Nascimento, S.; Inamorato dos Santos, A.; Rossetti, F.; Papanagiotou, E.; Nai Fovino, I.; Spirito, L.; Sobolewski, M.
• Pages: 101-108

Summary and conclusions

101 101

SUMMARY AND

CONCLUSIONS

Key insights

This report underlines a series of opportunities

and challenges across sec tors brought by

blockchain technology, which may introduce

signif‌icant changes in our ind ustry, economy

and society. We of‌fer a summary of key insights

collected from our analysis of blockchain

technology and its applications across sectors.

How blockchain works

Blockchain is a tamper-resistant and time -

stamped databa se (ledger) operating through

a distributed network of multiple nodes

or users. It is, however, a particular type of

database. Transactions bet ween users do not

require intermediaries or trusted third parties.

Instead, trust is based on the rules that everyone

follows to verify, validate and add transactions

to the blockchain – a ‘consensus mechanism’.

Blockchain is based on a par ticular combination

of key features: decentralisation, tam per-resistant,

transparency, security and smart contrac ts.

The lack of a central entit y controlling the syst em

creates strong resilience against single point-

of-failure f‌laws. Since it is extremely dif‌f‌icult

to change or delete the recor d of transactions,

in this sense the records on a blockchain are

tamper-r esistant . In public or open blockchains

all transactions are transparent and visible.

All transactions are time-stamped – that is,

data such as details a bout a payment, a contr act,

transfer of ownership, etc. are linked p ublicly to

a certain date and time. A nd smart contrac ts

enable the terms of agreement between parties

to be executed and enforced w ithout the need

for human coordination or inter vention.

However, a number of challenges remain

unresolved, such as the limited scalability

and performance of public blockchains, mainly

related to the low volume of trans actions, or

the high energy consumption when deploying

current PoW consensus mechanisms. Ot her

threats can arise from potential collusion from

a majority of participant s which could overrun

the network (51 % attacks), or from the high

dependency of run ning the network on a limited

number of participant s. A major source of security

vulnerability also lies in t he added responsibility

for key management, which ca n be as simple

and serious as losing a phone or a back-up of

the credentials.

Another key issue that needs further research

is how to safeguard personal , sensitive

or conf‌idential data. Transparent data on

a blockchain might be a problem when specif‌ic

data sets are not meant to be p ublicly available,

or need to be changed due to errors, inaccuracies

or other problems in the original data ent ry.

Potential conf‌lict s between specif‌ic blockchain

architectures a nd the EU’s GDPR warrant

a wider debate.

Scanning blockchain ecosystems

To a certain degree, the hype aroun d blockchain

technology has been inf‌l uenced or shaped by

a spike in interest from f‌inancial instit utions

since 2014. However, while more well-known