Intel: We are experimenting with large-scale blockchain expansion, and the first blockchain use case will not be the financial industry

Intel, the world’s largest chipmaker, is looking into a trusted execution environment for its hardware chips to provide greater security and privacy to blockchain users.

Speaking at the 'Tomorrow's Transactions' conference this week, Kelly Olson, head of Intel's distributed ledger technology group, discussed the possibility of using a 'secure enclave' approach similar to Apple's Touch ID to improve blockchain security.

Olson's team is currently working on large-scale deployment of blockchains, scaling them to tens of thousands or even millions of nodes, but he said the work is still in its early stages.

However, Olson did provide a case for using secure hardware solutions that can provide a trusted computing environment. A direct use case for such hardware solutions is key management for blockchains.

Olson also discussed Bitcoin specifically, noting that while the Bitcoin public blockchain network itself is already very secure, users have suffered a lot of losses due to lost or stolen private keys.

Olson said:

“Early blockchain deployments such as Bitcoin have proven to be highly secure, and the burden of network security has been shifted to the endpoints of the blockchain.”

Olson also discussed how using this secure hardware computing environment is not only safe but also private.

He said their goal is to bring privacy to blockchains without centralization, but the process will be difficult. One solution proposed is to use the hardware itself as a trusted third party that can provide a verification that is usually published publicly or privately.

He said:

“Privacy issues are among the most difficult to address because transaction verification and transparency often go hand in hand.”

Intel's Experiment

Olson also provided new insights into blockchain experiments being conducted at Intel Labs.

For example, he said his team is looking into using a highly customizable blockchain where users could change the consensus mechanism or introduce participation permissions.

However, he said there is one main difference between Intel's research and that of startups like R3: scale.

According to Olson, their tests have shown that traditional distributed consensus mechanisms such as RAFT do not scale well beyond about 100 nodes. However, Intel is working on blockchains that can scale to millions of nodes.

To scale a blockchain to sufficient size, he suggested using “sharding,” a technique actively explored by ethereum but that would be difficult for Intel to implement.

The future of blockchain: Will the first blockchain application case not be in the financial industry?

Finally, Olson talked about the evolution and use cases of blockchain, which he divided into three major stages.

First, monetary applications, such as Bitcoin; second, the creation of digital assets; and third, identity and reputation.

It’s clear that Olson believes that identity and reputation use cases will provide the most value to end users.

However, while Olsen understands the potential of blockchain, he also warned that the industry needs to be pragmatic. He believes that distributed ledger technology is still in the research stage and it is not suitable for enterprises yet. He also doubts that blockchain will be used for financial clearing and settlement soon, given the regulatory requirements required by the financial industry.

When asked about the first real use case of blockchain technology, Olson doesn’t think it will be the financial industry. Instead, he thinks it’s more likely that some kind of digital asset on the blockchain will be the first use case of blockchain. For example, tickets to a game, online tokens like game points.

Original article: http://www.coindesk.com/intel-hardware-security-blockchains/
By Siddharth Kalla
Compiled by: Kyle
Source (translation): Babbitt Information (http://www.8btc.com/intel-hardware-security-blockchains)