NIST updates key blockchain report
- By Sara Friedman
The National Institute of Standards and Technology has issued the final version of its interagency report on distributed ledger technology. The Blockchain Technology Overview is an updated version of a draft published in January that provides a high-level overview with explanations on how blockchain works, its use in cryptocurrencies, permissioned and permissionless blockchains, blockchain components and consensus models.
Transactions on the blockchain are stored in a ledger under distributed ownership that minimizes trust, security and reliability concerns that can come with centralized ownership. In a distributed blockchain network, every user maintains a copy of the ledger, making loss or destruction difficult. Overall resiliency of a heterogeneous blockchain network is also stronger because the nodes rely on different software, hardware and network infrastructure, so an attack on one node is not guaranteed to work on others.
Blockchains are suited to applications where participants who need for a cryptographically secure system of ownership or real-time monitoring of activity.
Other characteristics of blockchain, however, may limit its suitability in certain applications. According to NIST, questions to answer include:
- Data visibility: How much data should be visible on a permissioned or permissionless network?
- Full transactional history: How much transactional data should be visible to the public?
- Fake data input: How can checks be put into place to detect false data entry?
- Tamper evident and tamper resistant data: How can transaction history data be maintained?
- Transactions per second: How much compute power is necessary to overcome slow transaction processing?
- Compliance: Are there any laws or regulations that would change how the blockchain is designed?
- Permissions: Is there enough granularity in specific user roles? Who can administer permissions and how easily can they be revoked?
- Node diversity: How does the diversity of blockchain network participants offset risk?
NIST’s work to explain blockchain technology comes as Congress is trying to get its arms around the technology. On Sept. 26, Reps. Brett Guthrie (R-Ky.) and Doris Matsui (D-Calif.) introduced the Blockchain Promotion Act of 2018, which calls on the Commerce Department to establish working group to develop a definition of distributed ledger technology to guide government policy. The working group would examine potential uses for blockchain in spectrum management and study how federal agencies might use the technology.
The Congressional Blockchain Caucus, a group of industry and government representatives that study the implications of blockchain technology, recently met with stakeholders in three separate roundtable discussions to discuss issues surrounding blockchain, including digital identity, payments and supply chain as well as governance.
NIST's full report can be found here.