What is DLT and how did it begin? What is blockchain technology? What are the opportunities that blockchain technology may offer to libraries, and what obstacles will libraries need to overcome in adopting it? These are critical questions for understanding blockchain in the information professions.
Christina Cornejo, Librarian, Stockton-San Joaquin County Public Library; and Stacey Johnson, Library Manager and Technical Services Librarian, Chino Valley Public Library
For many people, the first thing that comes to mind at the mention of blockchain is Bitcoin and other cryptocurrencies. The term blockchain first appeared in a 2008 white paper written by an anonymous developer or group of developers known as Satoshi Nakamoto, who developed a peer-to-peer method of exchanging electronic currency.1 Their research became the basis for Bitcoin, the best-known of the cryptocurrencies.2 Blockchain provides the foundation for how transactions in this cryptocurrency are managed, stored, and verified, so without it, there really is no Bitcoin. But the core of blockchain, the idea of a distributed ledger that is shared by more than one entity to secure data for record-keeping, is not new. Indeed, there is reason to suggest that a version of this concept existed in medieval times.
In the transition period between oral forms of record-keeping and written ones, information may have been stored as objects or tokens. “Today, what once had a material form can be essentially dematerialized. Paper currency can be transformed into cryptocurrency. Land, fine wine, artwork, diamonds, food, and other material objects—though still physically in existence—can be transformed into virtual representations called ‘tokens.’ In this way, in a tokenized, blockchain record-keeping system, literally everything potentially becomes a record.”3
The reliance on physical objects or tokens to prove authenticity has been replaced by the ability to keep digital records. Unlike physical objects, digital records can be changed and must be secured through the use of encryption to protect the transfer of data on the Web from hackers.
As already noted, blockchain is the term used to describe a new technology that began as the underlying system behind Bitcoin. Bitcoin is a system of digital currency that provides a secure, and sometimes nearly anonymous, way to earn and use electronic cash without enlisting the services of a bank or other financial entity as the broker. Blockchain technology ensures that Bitcoins cannot be copied and re-used in multiple locations (e.g., no one is able to purchase an item using a Bitcoin at one store and then reuse a copy of the same Bitcoin at another store). Blockchain was developed to keep track of each Bitcoin, enable the transfer of ownership of Bitcoin if needed, and prevent the tampering with or copying of Bitcoins.
Blockchain is comprised of blocks of information or records that store data using sophisticated algorithms. The blocks are connected or chained together and distributed to a peer network of multiple trusted sources. Each member of the network has a key or an individualized digital signature that is assigned to the transactions made by that member. It is difficult, but not impossible, to hack a blockchain, since there are a number of inherent characteristics built into the technology that ensure the integrity of each record—making the network difficult to breach.
Several design features make blockchain a secure and ideally unalterable ledger or collection of informational transactions. Each block can contain unrelated data or a distinct group of related information. To make a blockchain, the distinct blocks are chained together by computer code—enabling the network to track whether each block has been altered in any way. A good way to visualize this is to consider the blockchain as a book with each page being a different document or set of information, like a contract or an academic transcript. The pages are numbered in order, and if someone tries to add a page or change an existing page within the book, it will be obvious that a change has been made. As a book, the blockchain would have an unlimited number of pages, but you can only add to the end of the book, without impacting the previous pages and pagination.
Continuing with the analogy of a book, this means that copies of the blockchain or the book are sent to multiple locations: locally, regionally, or internationally. The content in the book is chained together, and identical copies are distributed throughout the peer-to-peer network. The blockchain is immutable and cannot be changed without agreement from more than 50 percent of the network; however, in the simplest explanation, the blockchain can be hacked or altered if it is attacked by a group that controls more than 51 percent of the network (a 51 percent attack). Fifty-one percent attacks are more likely to target the more valuable cryptocurrency networks rather than other types of blockchain usage. There are different levels of security for blockchains depending on how they are made and how far they are distributed.
The ideal way to use a blockchain is to have a long list of information that needs to be recorded, visible to many people, and never change in the future; for example, sale contracts which can be used to prove ownership of an item or property, art provenance, or public records. Even personal records, such as academic transcripts, could be a good use of blockchain. The transparent blockchain is not something that will necessarily be used on its own, but as a way to provide access to documents and information with the security and assurance that they cannot be altered.
Blockchain applications are being tested by governments and organizations in a number of inventive ways, from applications in smart cities such as the Blockland Cleveland initiative4 to providing international aid to refugees. Librarians are beginning to think of possible blockchain applications for a system that is decentralized, tamperproof, and independent without the need for a broker to assist in holdings or transactions.
Professional information organizations such as the American Library Association’s Library Information and Technology Association, the National Information Standards Organization (NISO), and the Digital Public Library of America (DPLA) have placed blockchain technology on their radar for further exploration.5
Jason Griffey, Director of Strategic Initiatives, National Information Standards Organization
While technological change is rapid and unceasing, it is not often that something truly novel emerges, something that is fundamentally new and different in the world of the digital. Most new digital services or techniques are enhancements of previous work, and are evolutionary and predictable at least in scope, if not in exact form. But in 2008, something completely new and different did enter the world, and its anonymous creator called it blockchain. While it is true that blockchain leverages well-understood digital technology such as hashing6 and encryption, and that philosophically it shares a lineage with Merkle trees, it is safe to say that nothing like it had taken root and really worked prior to the Bitcoin white paper and initial mining event that began the era of blockchain.7
One of the reasons why it has taken so long to see the potential of a distributed system like blockchain is that it was not until around 2014 that people started seeing the decentralized database nature of a public blockchain system as a platform for the creation of user-facing services. It seems obvious in retrospect, but it took several years for programmers to see blockchain systems as possible answers to the current centralized state of web properties. This centralization, driven by market capture and the network effect, has caused the existing World Wide Web infrastructure to be far more centralized in actual use than it was originally planned to be in theory. Several huge multinational companies control the vast majority of services that people consume online, and those services are just as fragile as they are critical to most people’s experience of the Web. When something like Facebook or Amazon goes down, huge swathes of web content temporarily die with it.
The promise of blockchain is not the current state of its use. A few hundred initial coin offerings and a half-dozen obscure services do not a revolution make. However, the new architectures that systems inspired by blockchain are using, and the concepts behind blockchain that have been enabled, are likely to make a huge difference to the world over the next decade. A Web that is increasingly difficult to censor, one that defies local control and enables a truly robust set of distribution and archival tools for digital content, is a Web that is better for both producers and consumers.
For librarians, these systems will be significantly better than the existing highly centralized infrastructure currently in use. The services that are emerging from this initial round of decentralization, like Dat Project and Matrix, are extremely exciting since they point in the direction of a Web that is far less vulnerable than the one we have now.8
So where do libraries intersect with this potential new world of decentralized services and protocols? There are at least three areas that libraries and librarians should be watching:
This is not to say that decentralization is entirely positive. By emphasizing distribution and independence, decentralization has the capacity to further exacerbate filter-bubbles and self-directed informational limitations that have had deleterious effects on our society and culture over the last several years. It is possible that even with robust federation, informational silos could be re-created through accidental infrastructure, and rather than providing robustness and freedom, these services could devolve into pockets of self-organized biases. Especially in the area of social networking, there is the risk of existing social structures simply being replicated and resisting cross-pollination in the way that utopianists might describe. These risks should not be a reason to decry the development of these new services entirely; rather, these concerns should be seen as warning signs to heed in the development and deployment process. Having a plan for how to proactively avoid these risks will be far more effective than reacting to them when things begin to break.
Blockchain and other decentralized systems may afford libraries easier, more trustworthy, and more secure ways to track digital provenance, store metadata, access secure authentication tokens, verify transactions, run decentralized data stores, and more. Over the next five years, the multiplicity of services that use blockchain or a similar decentralized technology will be evident. Librarians who are not paying attention to this trend risk not only being late adopters, but possibly missing the opportunity to be a vital and driving part of this new decentralized Web. Librarians ceded their opportunity to be significant actors in the first incarnation of the World Wide Web to commercial entities. In this next-generation decentralized Web, librarians have the opportunity to be partners with the new technology leaders, working in cooperation with them to build the necessary infrastructure to allow for fully decentralized services to emerge.
Make no mistake, whether librarians act as partners or as users, these blockchain-derived technology infrastructures will enable new and interesting services and systems to emerge. The decentralized-yet-federated nature of these new systems will present intriguing possibilities to share content and media, and produce discovery layers that enable searching rich and deep sets of collections; most significantly, the content and collections shared across a decentralized network will then be accessible to all. The next generation of the Web will not be like the current generation, and libraries and librarians must watch these developments in order to ensure that their organizations emerge from the resulting rebuilding as resilient and remarkable as ever.
Bohyun Kim, Chief Technology Officer, University of Rhode Island Libraries
As discussed previously, blockchain secures data and prevents tampering by its technical implementation alone, and it changes the current role of a third-party authority. Traditionally, a third-party authority is brought into many types of transactions, such as fund transfers, real estate purchases and sales, insurance, and any type of credentialing ranging from school graduation to marriage certification. Its role is to guarantee the authenticity of the transaction and the integrity of the recordation process. However, blockchain renders this authorizing and recording role of a third party unnecessary.
Without the need of the mediating third party, a transaction becomes immediate, and its cost becomes much lower, while remaining secure. For example, when blockchain is adopted in real estate transactions, people will no longer need to go through a laborious process to officially record the purchase or sale of a real estate property, which involves the recorder’s office of the city or county office and private title insurance. Blockchain can make the process of recording a property-related transaction more straightforward and efficient, thereby saving time and money.12 Similarly, with blockchain implemented in banking, people will be able to quickly and safely transfer funds across different countries without going through banks. The World Food Programme is already using blockchain to increase their humanitarian aid to refugees.13 Such practices can drastically lower the fees involved, and the transaction will take effect much more quickly, if not immediately.
In this respect, blockchain can serve as an alternative trust protocol that decentralizes traditional authorities. As such, it can be used for a wide range of purposes beyond real estate or financial transactions. From this, one can imagine the scale of the impact the adoption of blockchain can bring should it be adopted widely. Blockchain can lead to efficiency, convenience, and cost savings in areas where the authenticity and security of records are of paramount importance. These areas include electronic health records, digital identity authentication/authorization, digital rights management (DRM), digital provenance, and historic materials that may be contested or challenged due to the vested interests of certain groups and digital provenance.
However, there are some issues with blockchain technology. Since blockchain achieves its security by public key cryptography, if one loses one’s own personal key to the blockchain ledger holding one’s financial or real estate asset, then this will result in the permanent loss of such assets.14 With the third-party authority gone, there will be no institution to step in and remedy the situation. Other issues with blockchain include:
The last issue, energy consumption, has both environmental and economic ramifications because it can cancel out the cost savings gained from eliminating a third-party authority and related processes and fees.
There is growing interest in blockchain among information professionals, but there are also some obstacles to the technology gaining momentum and moving further towards wider trial and adoption. One obstacle is the lack of general understanding about blockchain in the larger audience of information professionals. Due to its original association with Bitcoin, many mistake blockchain for cryptocurrency. Another obstacle is technical. The use of blockchain requires setting up and running a node in a blockchain network, such as Ethereum, which may be daunting to those who are not tech-savvy.16 This creates a high entry barrier for those who are not familiar with command line scripting and yet still want to try out and test how a blockchain functions.
The last and most important obstacle, however, is the lack of compelling use cases for blockchain technology in libraries, archives, and museums. To many, blockchain is an interesting new technology, but even many blockchain enthusiasts are skeptical of its practical benefits at this point, when all the associated costs are considered.17 Of course, this is not an insurmountable obstacle. The more familiar people get with blockchain, the more ways people will discover to use blockchain in the information profession that are uniquely beneficial for specific purposes. In order to determine what may make a compelling use case of blockchain, the information profession would benefit from considering the following:
These questions will help connect the potential benefits of blockchain with real-world use cases and take the information profession one step closer to the wider testing and adoption of the technology. Despite all of the issues discussed above, blockchain is expected to spread to many industries due to the unique benefits it offers, and it eventually will have an impact on libraries and the information profession.
6. A hash is a one-way mathematical function that derives a unique value from a given input.
11. This section is a revised version of an article originally posted at the ACRL TechConnect blog. See https://acrl.ala.org/techconnect/post/blockchain-merits-issues-and-suggestions-for-compelling-use-cases/.
12. http://www.chicagotribune.com/classified/realestate/ct-re-0715-blockchain-homebuying-20180628-story.html.
13. Blockchain may be used not only for financial transactions, but also for the identity verification of refugees in the future. See https://www.technologyreview.com/s/610806/inside-the-jordan-refugee-camp-that-runs-on-blockchain/.
15. https://www.investopedia.com/terms/1/51-attack.asp. And https://www.forbes.com/sites/shermanlee/2018/04/19/bitcoins-energy-consumption-can-power-an-entire-country-but-eos-is-trying-to-fix-that.
17. See https://go-to-hellman.blogspot.com/2018/06/the-vast-potential-for-blockchain-in.html; https://eprint.iacr.org/2017/375, and http://doyouneedablockchain.com/.
18. The interaction can also be a self-executing program when certain conditions are met in a blockchain ledger. This is called a “smart contract.” See https://www.technologyreview.com/s/610718/states-that-are-passing-laws-to-govern-smart-contracts-have-no-idea-what-theyre-doing/.