What do private blockchain builders really want?
"These problems really aren’t so far apart, it’s just that people are trying to solve the problems in different ways,” Baldet told the audience at EthCC, an ethereum conference in Paris on Friday.
In a tightly packed lecture hall, Baldet laid out the mechanics of her company's private blockchain network, Quorum, while seeking to put forth a broader message about how her bank, one of the largest globally, is looking to foster collaboration across blockchains.
And Baldet is in perhaps a unique position to advance the dialogue: not only is Quorum the first project that JP Morgan developed in its Blockchain Centre of Excellence (BCoE), it's based on a fork of ethereum's software. As such, Baldet spoke at length about how her time is spent engaging with cryptocurrency communities in an effort to find common ground.
“I spend a lot of time talking about ethereum and cryptocurrency and open blockchains to enterprises, businesses, central banks and corporates,” Baldet said, “I don’t spend a lot of time going the other direction.”
Yet, according to Baldet, these conversations are crucial to mutually educate and improve both sectors of the industry. While public and private blockchains are often pitched against each other, Baldet told CoinDesk in an interview, "I don’t think those two things need to be so different or are necessarily mutually exclusive."
And while there are trade-offs with public blockchains that enterprises simply cannot afford, what businesses want from ethereum, and what ethereum wants in return, she said, is the ability to interoperate.
In this way, enterprises can inhabit their own private universes away from the public network, but publish data to gain the security and auditability of a public blockchain.
“It doesn’t necessarily have to be all enterprise disaster recovery systems over here, and all anti-fragile public blockchain anonymous transaction things over here,” she said.
Rather, Baldet continued:
And interoperability is an area in which Baldet feels businesses have typically failed.
In a refrain on how enterprise software tends to be complicated, fuzzy and proprietary, Baldet told the audience, “When we talk about enterprise blockchain, this is where people get stuck.” And, she believes, the impact of this is that businesses struggle to attract developer talent.
“[Developers] don’t necessarily want to work on something that looks like it was developed in the 1990s,” Baldet said.
As such, it’s down to businesses to cooperate along these lines to create simple, user-friendly software that can interact with existing tech, and work towards interoperability solutions such as Cosmos, Polkadot and Interledger that would allow blockchains to share data.
Elsewhere, Baldet has warned about what she has called “crypto-balkanization,” the splintering of blockchain communities into increasingly uncooperative factions, “virtual continents along political axes” that could “weaken privacy and make interoperability harder.”
Between the two extremes of distributed ledger projects and public blockchains like ethereum, there is a “fuzzy grey area in the middle” that Baldet has termed “mutualized infrastructure.”
A system like this would allow blockchains to communicate while meeting the requirements of different camps, and this, Baldet argued, is the best way to ensure an equal access to services in a fully-fledged internet of value.
She told the audience:
Little private universes
Toward that goal, Baldet explained that Quorum and ethereum are purposefully alike, with as much as 95 percent of the software, in her estimation, being similar in both versions.
“It’s actually not changed that much, and that’s intentional, there’s very minimal modification,” Baldet said, during her talk.
Still, unlike the public ethereum blockchain, Quorum is meant to run in a permissioned setting, with every node in the network being identified via a public and private key pair.
Using these keys, smart contracts can be addressed to any node in the network, opening the possibility of private operations, the hash of which is then validated and stored on the Quorum blockchain.
But because of the privacy needs of businesses, or “being able to transact or transmit information without surrendering information ownership,” Baldet explained, there are other layers to the networks confidentiality as well.
Last year, Quorum coupled with privacy-centric cryptocurrency zcash, to integrate a layer of security layer of zero-knowledge cryptography on top of its blockchain.
Called the “zero-knowledge settlement layer,” this allows for zero-knowledge ethereum tokens that only reveal information such as transactional quantity and ownership, and that notably doesn't reveal anything else about the function of the tokens.
And privacy is something that concerns Baldet in public blockchains as well.
“We could do a lot to reverse the aggregation and centralization and creation of data lakes, which over time, especially in a transparent public blockchain, are going to at some point become surveillance lakes,” Baldet told the audience, continuing:
But privacy is just one innovation that Baldet helped spearhead on public ethereum.
Another crucial exchange is the benefit that private blockchains could have for scalability, to stop the overburdening of the public blockchain by bringing certain projects off-chain. CryptoKitties, she reminded the audience, “didn’t work out well for anyone for a few days.”
In conversation with CoinDesk, Baldet elaborated, stating, “It’s not helping scale public ethereum by scaling public ethereum, but it’s taking some of the load off the network.”
By pegging itself closely to the platform and keeping up with its development, "Quorum benefits from all the security and scaling research happening on mainnet ethereum,” Baldet said, adding:
Pending the release of new interoperability protocols, such projects can continue to interact and support each other for alternate, customized environments, “private environments on the side,” as Baldet named them, “their own little universe.”
And an interactive network of cooperative, public and private blockchains is close to ethereum’s vision.
At the launch of the Ethereum Enterprise Alliance last year, founder of ethereum Vitalik Buterin went so far as to call for collaboration between the open blockchain and businesses, stating, “we have shared challenges.”
Amber Baldet image via Twitter
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