MIT recalls Bitcoin developers' doubts about 'ChainAnchor'

Rage Review : The MIT Connected Science Research Project of ChainAnchor, a blockchain project developed by the Massachusetts Institute of Technology (MIT), has received widespread attention because analyst Todd condemned the project in the article for "bribing" these Bitcoin miners and rewarding these participants who did not conduct transactions without identity verification. However, an MTI spokesperson clarified that the discussion of ChainAnchor and Bitcoin seemed to be unrelated. The spokesperson said that such a system can make the permissioned blockchain more compliant with the requirements of the Anti-Money Laundering Law (AML) and Know Your Customer (KYC) system.

Translation: Nicole

A blockchain project developed at the Massachusetts Institute of Technology (MIT) has received new attention this week after criticism of alleged design elements, although those involved have denied the authenticity of the claims.

It was all sparked by the events of April 21, when Bitcoin Core developer and blockchain consultant Peter Todd published what he believed to be a “leaked copy” of a document related to an MIT connection science research project called ChainAnchor.

In the article, Todd, a threat analyst who works with both Bitcoin and non-Bitcoin companies, decried a project that seeks to “bribe” these Bitcoin miners by rewarding these unauthenticated participants for not conducting transactions.

Peter Todd

Todd told CoinDesk:

“We’re talking about miners being forced into deals with managed plans.”

The speech drew criticism from MIT’s Bitcoin social media channel, which even tried to encourage miners to pledge that they would not support such a plan.

MIT responded to the criticism in a statement to CoinDesk today, denouncing the article as having no substance.

An MIT spokesperson said:

“First, I’m glad that there is interest in what we’re doing. We published this article on a public website a few months ago and have been updating it on www.mit-trust.org. However, ChainAnchor seems to be unrelated to the discussion of Bitcoin.”

The university updated a white paper on April 17, which is linked to the ChainAnchor project. In contrast, Todd’s slides and image tags were dated February, and although they are similar to MIT’s, they have made significant changes.

For example, the ChainAnchor document states that the project is intended to “address identity and access control issues in shared permissioned ledgers.”

Moreover, the language of the filing suggests that the system (while inspired by Bitcoin) is not intended to run on the live Bitcoin blockchain.

Todd's critical articles

The release of the white paper appears to challenge critical articles by Todd, who said the system looks a lot like the one he presented, and mining companies using his published slides on public blockchains.

He told CoinDesk:

“There is no reason to have regulated transactions on the Bitcoin network when you are already expecting AML. My main point is that it is unreasonable to want to buy miners not to mine Bitcoin transactions.”

He went on to say that even if the system is used on a private network, it is important to consider how dangerous such an architecture would be on a public blockchain like Bitcoin.

Acknowledging that his statement might be irrelevant if the project was intended to be offered on a permissioned network, he said:

“We should consider the threat that this poses. I can imagine if a large exchange signed on to it, it could cause serious problems.”

He added:

“If it had nothing to do with Bitcoin, I wouldn’t even be discussing it.”

Overall, Todd’s comments express a concern that Bitcoin’s use case as a store of value has fallen out of favor with industry startups, and he worries that other better solutions will keep users using the network.

Such comments come amid a long-standing debate over how bitcoin can be used on a large scale, though one that could be answered in the upcoming release of Segregated Witness, a possible solution.

As for MIT, it reiterated its support for the Bitcoin network in its current form, but said that ChainAnchor is more closely associated with larger consortiums such as R3, where permissioned blockchain systems require new ways of establishing trust.

MIT says:

“We are also looking at other blockchains, including permissioned blockchains and some of the blockchains that mainstream companies are starting to use.”

The spokesperson said such a system could make permissioned blockchains more compliant with anti-money laundering (AML) and know-your-customer (KYC) regulations.

MIT said it will work to bring the blockchain system into closer compliance with the rules of a white paper due in May.