Blockchain Summit Zurich 2018

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Blockchain Summit Zurich 2018

On 7th and 8th of March 2018 I attended the Blockchain Summit Zurich in the Hilton Airport Hotel.

It was the first cryptocurrency conference I attended and I would like to write a brief summery of my experience.

Please be aware that I am endorsing non of the ICOs mentioned here. I am trying to give you examples of what types of ICOs are currently happening. If you find an ICO interesting based on what you read here you need to do your own research before investing your money.

The first day was held in a smaller circle. There weren’t that many participants and some of the talks were Workshops. It was really easy to get in touch with other participants and chat in the breaks or during lunch. I met a lot of interesting people from different areas. There was a very wide mix of people that attended the conference. From company representatives with their own ICO, people interested in blockchain technology, to employees of a blockchain investigation business to individuals interested in investing everyone was present.

Many of the talks were by one company which was about to launch or already launched their ICO. Basically they all pitched their respective products. Quite a few of these are developing products that would allow tokenisation of non-bankable assets such as art, collectibles such as rare cars or watches, real estate, private equity,… The idea always is to take something that has very little liquidity as it cannot easily be sold and put it on a blockchain. Thus making it more accessible as the asset appears in an international market place. It would also allow the elimination of middlemen that usually take high fees in these kinds of trades (just imagine the fees of Sotheby’s for art auctions). In addition it is also possible to add provenance data to the blockchain. This might be very important for pieces of art or old cars where the authenticity of a product is highly relevant. For areas such as real estate it would also allow the tracking of all previous sales of a property or for instance to see what maintenance has been performed by the owner. So transparency could be improved significantly by using a blockchain.

My main issue with all companies that are attempting to put non-bankable assets on the blockchain is that I expect this to be extremely difficult. I truly stand behind the idea of accomplishing this and would welcome such a market place. The legal obstacles are immense. Especially since many countries have different laws. Just assume that you would want to sell your Swiss home on the blockchain. Many potential buyers wouldn’t even legally be allowed to buy property in Switzerland. Each non-bankable asset class has its own challenges. So for one company to be able to manage all of them will take several years in my opinion.

Another set of talks focused on regulatory challenges that ICOs are facing. Many of these issues focused on US investors. It is rather difficult for a company to attract US investors for an ICO as there are many legal challenges to be overcome. Switzerland does have quite a welcoming legal framework for ICOs which is also why so many companies decide to move to Crypto Valley in Zug or to another Swiss city.

I would like to highlight a few talks I particularly enjoyed.

Farma Trust

In short the idea behing Farma Trust is to track medicine from it’s origin to the end user to avoid users dying from counterfeit drugs. The end user will be able to verify the medicine using an app.

FarmaTrust is the most efficient global tracking system which provides security to the pharmaceutical companies, governments, regulators and the public, that counterfeit drugs do not enter the supply chain. Our Blockchain based system utilises Artificial Intelligence and big data analysis to provide the pharmaceutical industry with value added services which allow for more efficient processes and methods as well as a more transparent supply chain. Our system is safe, secure, encrypted and immutable.

I really liked the fact that society would be able to benefit from this product and lives might be saved. Having the whole supply chain of a particular drug on a blockchain would definitely be useful. It is also a natural application of blockchain technology as it gives an immutable record of all transactions, when they happened and no single entity can change an entry. Law enforcement might also have more options to discover counterfeit drugs with this system.

VR All Art

This company has a very interesting approach to tokenising art. They combine virtual reality with blockchain technology in a very interesting innovative approach. The problem that VR All Art is trying to solve is straightforward. Art space in galleries is very limited. Galleries can usually only exhibit one artist at a time. On the other hand artists have a hard time finding a gallery that will exhibit their work. This whole process is very localized. Additionally it can be rather difficult to exhibit large works of art. Virtual reality can solve this problem in a very nice way.

VR ALL ART sets the foundation for an unprecedented evolution of art exhibitions, art spaces and art trading. It is an unlimited space in a new reality – a metaverse of galleries and museum spaces with no borders and no physical boundaries. It enables everyone to explore artworks and discover artists from all over the world wherever they are, at any time. It also gives new power to artists, as they are no longer constrained to the physical limits of real-world space and time.

Galleries can work together with VR All Art to create virtual reality spaces that can be visited with special VR equipment. So a gallery could have one real exhibition and 10 more virtual ones all at the same time. It would also be possible to visit a gallery on the other side of the planet. This would create greater exposure for artists too. You might now wonder where blockchain technology factors into this. The idea is that art can also be bought via the platform. Once you would like to buy a painting or other piece of art you could pay with the AllArt coin. AllArt coin would also have several more applications such as paying for exhibition fees. The Swiss based project also plans to use blockchain technology for traceability of art pieces.

Firelotto

Firelotto is a blockchain lottery. It basically created a lottery which is completely secure and reliable due to the use of smart contracts and a totally random draw of the lottery numbers. The winning lottery numbers are determined by the bitcoin blockchain. From the moment the lottery is stopped, e.g. at 6pm, the winning numbers will be the hash of the next block in the bitcoin blockchain. There is no way to predict this hash so it is totally random and there is no way to cheat. For details please refer to my article on how the blockchain works. In addition smart contracts will guarantee that someone who selected winning numbers will automatically receive their winning without having to do anything.

What remains questionable for me about the whole idea of a blockchain lottery is the legality. I am not saying that it is illegal, I am merely saying that I am unsure whether it is legal. Many countries require you to pay taxes on lottery winnings. What I however really like about the project is that it utilizes technology in a brilliant way to solve a problem. Many people play the lottery and there have been many scandals in the past where lottery organisers were accused of cheating. See for example this article or this one.

Why Firelotto is having their own ICO wasn’t very clear to me in the beginning. The lottery is already working and they have people playing it. So what is the purpose of an ICO?

The token holder will receive a commission from each ticket sold in every drawing. Commission payouts are secured by smart contracts and provide token holders with an almost endless source of income.

So from what I understand the money raised during ICO will be used to supply the guaranteed prize pools for the lottery. Additionally it will be used to pay out commissions. If you buy FLOT, then you will be able to earn from the lottery as 10% of all lottery ticket sales will be distributed among the owners of FLOT via smart contract.

Althought he company states the following in their whitepaper.

The Fire Lotto is anonymous.

This is not the case. Be aware that no public blockchain is truly anonymous. It might not be completely obvious at first that you own a particular address but there are companies out there that specialize in tracking down illegal activity on the blockchain and they help law enforcement if blockchain and cryptocurrencies are involved in a case.

This leads me to the next interesting talk.

Blockchain Intelligence Group

Dina Jonathan Shomer was attending the conference and gave an impromptu lightning talk about the work she does with the Blockchain Intelligence Group. This is a Canadian company that specializes in tracking users activity on the blockchain.

Cryptocurrency’s exponential growth is only adding to marketplace concerns around illicit use, risk and regulatory compliance. That’s why our mission is to bring cryptocurrency mainstream by giving our clients and users peace of mind. Our proprietary and Blockchain-agnostic, search and analytics solutions bring security and accountability to cryptocurrency.

Law enforcement, government agencies and RegTech use our suite of solutions to forensically investigate and monitor unlawful cryptocurrency use. Armed with the techniques and advanced search algorithms our team of experts develop, clients can reliably detect suspicious activities within cryptocurrency transactions and the “Dark Web”.

I particularly enjoyed this short talk as it clearly illuminated the fact that the Bitcoin blockchain is not anonymous. There are ways to track a users activity. If you buy illegal goods in the dark web this might be found out. As a side note, I personally do not understand why anyone would want to do illegal activities with a public blockchain where each transaction is recorded for eternity for anyone to see.

She then gave a quick introduction of BitRank, one of their free services. This is a platform where you can enter any Bitcoin address and get a rating for said address. If you for example enter an address that paid for child pornography on the dark web you would see a low rank. If you enter a new address it would be neutral. I checked some of my own addresses and keep getting a neutral score of 50 for all of them.

Securify

The last talk I would like to highlight was by Dr. Petar Tsankov from ETH Zürich.

Security concerns have repeatedly shaken the trust in handling billions of USD in decentralized smart contracts. It has become clear that writing secure smart contracts is a significant challenge. In this talk, I will present the first push-button verification tool for Ethereum smart contracts that is fully automated, easily extensible to new security vulnerabilities, and provides strong security guarantees.

As with any coding project, writing bug free smart contracts is not trivial. Researchers from ETH Zürich have now come up with an automatic verification tool that will cover many of the most common pitfalls in smart contract development. The tool is available here and anyone can verify Ethereum based smart contracts. I have tried to verify a few smart contracts using the tool but it seems to still be a bit buggy.

Impressions From the Conference

 

I really enjoyed attending the conference and networking with the other attendants. For many of the presented ICOs I had to ask myself the question “why do they need their own token”. It just wasn’t very obvious why the project had to rely on the blockchain and do its own ICO. As an investor I want to clearly understand the purpose of a token as this purpose is what will generate revenue for myself. Today there are so many ICOs happening each day that a project one invests in really needs to stand out.

 

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