Consensus algorithms and miningConsensus algorithms are about how a set of decentralised users maintain a common state or a log. In a typical permission-less setting, the mining process causes a huge waste of real resources like electricity. An interesting question is whether the consensus or the trust among users in a decentralised environment can be achieved without the overconsumption of resources. We have a specific proposal for this — Work your Stake. We want to study this and other solutions. – University College Oxford Blockchain Research Centre

Date:: 6th August 2018

Consensus algorithms and mining

Consensus algorithms are about how a set of decentralised users maintain a common state or a log. In a typical permission-less setting, the mining process causes a huge waste of real resources like electricity. An interesting question is whether the consensus or the trust among users in a decentralised environment can be achieved without the overconsumption of resources. We have a specific proposal for this — Work your Stake. We want to study this and other solutions.

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The economics of blockchain

Blockchains have brought a new phenomenon into the world: cryptocurrencies such as Bitcoin. We are interested in what we might term the microeconomics of a blockchain: how an economy can arise within a single blockchain which coins are spent for goods and services; the forces affecting the value of a cryptocurrencies and the control theory of stabilisation. The corresponding “macroeconomics” then raises the problem of the effect that cryptocurrencies and blockchain applications have on the wider economy. The latter will include the effect of competition from decentralised blockchain applications on traditional sectors.

Blockchain applications

We believe there is considerable scope for devising decentralised algorithms for blockchains, particularly private and mainstream ones where is a stronger expectation of trust. We have developed a variety of these for things like escrow and fair exchange. Such algorithms are needed for creating applications which sit on top of blockchains, whether in asset custody, banking and innovative finance, managing big data, supply chain management and a myriad of other areas.

Bridging digital and physical worlds for security

Conventional authentication schemes used in blockchains are based on cryptographic credentials generated in the ‘digital world’, such as PINs/passwords, long-term secret keys, or digital signatures. Yet, such digital credentials are easy to copy and steal. We have designed security protocols which depend on the properties of the ‘physical world’ such as location, distance, and time — such physical properties are much harder to spoof or manipulate as they are governed by physics, i.e., physical laws. For example, to access the blockchain, a participant should have a correct ‘physical fingerprint’ which can be its location or a distance to an asset. These properties can be measured and observed and as such we can continuously verify the authenticity and integrity of the blockchains.