Version History
Policy and legislation
Policy objectives
Blockchain has great potential in providing an infrastructure for trusted, decentralised and disintermediated services beyond the financial sector. The first Semester of 2018 has seen $6.3bn invested in ICOs and $885mn for VC [41].
While the FinTech industry has been an early adopter because of its early use case of bitcoin, blockchain may benefit and potentially transform many other industries. It is considered a foundational technology that some compare to the rise of the Internet in the early 90s. More than a technology, it could lead to a major political innovation by redefining the way we operate transactions, access information and share data (e.g. empowering patients to securely share e-health records and decide who to grant access to their data).
Blockchain is a promising technology to share data and manage transactions in a controlled manner, with many possible applications to deliver social goods in the field of eHealth and eGovernment, health records, land registries or the security certification of links in an Internet of Things chain of devices, food safety, trust funding (e.g., for development or humanitarian programmes), manage intellectual property rights and eID. Provisions must be taken at all stages to comply with the GDPR.
It has also great potential for the private sector, in trading, contracting, supply chain management, traceability along industrial supply chains (e.g. on social & environmental conditions of work, on material composition or on the maintenance history of the item) and much more. It may also transform the governance of private organisations and of companies (concept of Decentralised Autonomous Organisation - DAO), and hence impact labour rights. Furthermore, from a regulatory and supervisory point of view, it can provide regulators with the same view into the data as the companies they're regulating, thereby reducing fraud and compliance costs and facilitating auditing.
However, this process is hindered by a lack of harmonisation and interoperability that constitute obstacles to cross border and cross sector transactions. The responsibility for public policy-makers would be to support innovation within a safe and future-proof technological and regulatory environment, ensuring appropriate interoperability, transparency, accessibility, monitoring and governance
In the context of a DSM where the amount of online transactions and data is exploding, setting the right conditions for the advent of an open, trustworthy, transparent, compliant and authenticated transaction system is a real challenge for the EU. Existing decentralised environments lack trust, accountability, interoperability, regulatory certainty and mature governance models.
EC perspective and progress report
The Commission organised a policy workshop on blockchain standardisation on 12 and 13 of September 2017, and participates in and follows up the standardisation activities related to Blockchain and Distributed Ledger Technologies carried out by the different SDOs, such as ISO, ITU-T, ETSI or CEN-CENELEC, in order to engage in and contribute to the development of the future standards.
The European Commission launched the EU Blockchain Observatory and Forum in February 2018, involving private stakeholders and public authorities in technical and regulatory discussions about the future development and applications of blockchain technology. Among its important tasks, it is gathering the best European experts in thematic workshops on important subjects such as Blockchain and GDPR, or blockchain innovation, and producing reports which will help European stakeholders to deploy blockchain based services in Europe.
On the 10th of April 2018, the European Blockchain Partnership (EBP) was launched, with 28 European countries agreeing, through a joint declaration to cooperate in the establishment of a European blockchain services infrastructure (EBSI) that will support the delivery of cross-border public services, through interoperability and open interfaces and with the highest standards of security.
On 3rd April 2019 the Commission supported the launch of the International Association of Trusted Blockchain Applications – INATBA -, which brings together representatives of the stakeholders across the value chain. INATBA offers developers and users of DLT a global forum to interact with regulators and policy makers and bring blockchain technology to the next stage. It will support the development and adoption of interoperability guidelines, specifications and global standards, to enhance trusted, traceable, user-centric digital services, via a working group on standardisation to interact with standardisation organisations. On 11-13 November 2019 INATBA together with EU Blockchain Observatory and forum, Alastria and the European Commission co-organised the Global blockchain congress CONVERGENCE.
The European Commission has already invested more than € 80 million in projects supporting the use of blockchain in technical and societal areas. Up to € 300 million should be further invested until the end of the EU funding programme Horizon 2020. Furthermore, the European Commission is launching the AI/Blockchain fund, which finances a portfolio of innovative AI/blockchain companies and contributes towards development of a dynamic investor community. Expected investment is up to € 300 million. In addition, more funding will be available through Horizon Europe R&I Programme.
References
- Mid-Term Review on the implementation of the Digital Single Market Strategy, COM(2017) 228 final https://ec.europa.eu/digital-single-market/en/news/digital-single-market-commission-calls-swift-adoption-key-proposals-and-maps-out-challenges
- EU Blockchain Observatory and Forum https://www.eublockchainforum.eu
- European Blockchain Partnership https://ec.europa.eu/digital-single-market/en/news/european-countries-join-blockchain-partnership
Requested actions
Action 1: Taking into account the results from the EU observatory, the standardisation community should analyse possible standardisation needs and reflect on best way to achieve them. Activities may focus on organisational frameworks and methodologies, processes and products evaluation schemes, Blockchain and distributed ledger guidelines, smart technologies, objects, distributed computing devices and data services.
Action 2: Regularly update the white paper on the EU perspective on blockchain/DLT standardisation.
Action 3: Identify use cases which are relevant for EU (including EU regulatory requirements like from GDPR, ePrivacy, eIDAS, TOOP, etc..) and submit them to relevant standardisation bodies, including CEN-CENELEC and ETSI, and also ISO, ITU)
Action 4: Identify actual blockchain/DLT implementations in the EU and assess the need for standardisation, harmonisation and workforce training or adaptation.
Action 5: Standardisation of the operation and reference implementation of permissioned distributed ledgers and distributed applications, with the purpose of creating an open ecosystem of industrial interoperable solutions.
Action 6: Standards Development Organisations active in blockchain/DLT standardisation to liaise and coordinate to take advantage of synergies and maximise resources, including with relevant public and private partnerships.
Action 7: A general framework for Governance of the European networks based on DLT should be developed to allow the flow of smart contracts between different networks.
Activities and additional information
Related standardisation activities
ISO
ISO/TC 307: Blockchain and distributed ledger technologies:
https://www.iso.org/committee/6266604/x/catalogue/
The main working groups and technical reports:
- WG1: Foundations
ISO/DIS 22739 Terminology
ISO/WD TS 23258 Taxonomy and Ontology
ISO/CD 23257.2 Reference architecture
- WG2: Security, privacy and identity
ISO/CD TR 23244 Privacy and personally identifiable information protection considerations
ISO/CD TR 23245 Security risks, threats and vulnerabilities
ISO/CD TR 23576 Security management of digital asset custodians
- WG3: Smart contracts and their applications
ISO/AWI TS 23259 Legally binding smart contracts
- JWG4: Joint ISO/TC 307 - ISO/IEC JTC 1/SC 27 WG; Blockchain and distributed ledger technologies and IT Security techniques
ISO/NP TR 23246 Overview of identity management using blockchain and distributed ledger technologies" - to be replaced with "Overview of existing DLT systems for identity management.
- WG5: Governance
ISO/NP TS 23635 Guidelines for governance
- WG6: Use cases
ISO/CD TR 3242 Blockchain and distributed ledger technologies – Use cases
- SG7: Interoperability of blockchain and distributed ledger technology systems
Most standards are under development. The most mature document is WG1: ISO/DIS 22739 "Terminology" which is at Enquiry stage and is expected to be published soon. The Technical Report of JWG4: ISO/NP TR 23246 "Overview of identity management using Blockchain and DLT" did not reflect recent advancements in the area of Identity well. This technical report has been cancelled and, instead, a completely new Technical Report on "Overview of existing DLT systems for identity management" is planned.
In the frame of WG6 "Use cases" the EC proposed EBSI "Identity" use case, which has been confirmed by the working group as eligible to be included in the upcoming publication. Additionally, in the future iterations it could be expected that one more use case EBSI "Diploma" will be included as well. It is particularly interesting as an example of possible interoperability with a similar use case proposed by India.
IEEE
IEEE has standards and pre-standards activities relevant to blockchain, including a new horizontal standards working group on developing a blockchain framework for IoT, different applications, including blockchain data models, , IoT, agriculture, and autonomous vehicles, as well as vertical standards activities focusing on blockchain e.g. for agriculture (P2418.3), healthcare (2418.6), energy (2418.5), and connected and autonomous vehicles (P2418.4), and finance (2418.7).
IEEE P2418.1: Standard for the Framework of Blockchain Use in Internet of Things (IoT)
IEEE P2418.2: Standard Data Format for Blockchain Systems
IEEE also focuses on a pre-standardisation project on digital inclusion and agency, which leverages blockchain technology.
https://ieeesa.io/rp-blockchain
ITU-T
ITU’s standardisation activities in the field of distributed ledger technologies are manifold. In early 2017, the membership adopted a report of the ITU-T Focus Group on Digital Financial Services (FG DFS) on distributed ledger technologies and financial inclusion.
The Financial Inclusion Global Initiative (FIGI) was set up jointly by ITU, World Bank, Bank for International Settlements (BIS) and the Bill & Melinda Gates Foundation. The main objective of FIGI is to implement the recommendations of the FG DFS, the high-level principles of the Payment Aspects of Financial Inclusion (PAFI) report of the World Bank and the BIS at a country level over the next three years. Three working groups have been set up under FIGI to support the country implementations and develop technical guidelines and requirements for standards for digital financial services:
- Security, Infrastructure and Trust
- Digital Identity
- Electronic Merchants Payment Acceptance
DLT for financial inclusion is one of the areas where technical guidelines and recommendations for new standards are being considered in the Security, Infrastructure and Trust Working Group, particularly:
- Security aspects of DLT
- Legal issues of DLT for financial inclusion
- Use cases of DLT for financial inclusion
ITU-T Focus Group on Digital Currency including Digital Fiat Currency (FG DFC) was set up in 2017 to consider the use of distributed ledger technology to support digital fiat currency for financial inclusion. The focus group concluded its work in June 2019. The deliverables of the Focus Group addressed the legal and regulatory requirements for Central Bank Digital Currency, the security model for DFC, and the architecture for retail, wholesale and cross border central bank digital currency and its integration with other digital currencies and payment systems. A definition of terms used in digital currency was also developed.
The deliverables of the focus group can be accessed here: http://itu.int/en/ITU-T/focusgroups/dfc
The ITU-T Focus Group on Application of Distributed Ledger Technology (FG DLT) was established in May 2017
- to identify and analyse DLT-based applications and services;
- to draw up best practices and guidance which support the implementation of those applications and services on a global scale; and
- to propose a way forward for related standardisation work in ITU-T Study Groups.
FG DLT concluded on 1 August 2019 and submitted the following Deliverables to its parent group, ITU-T TSAG for further consideration: https://www.itu.int/en/ITU-T/focusgroups/dlt/Pages/default.aspx
https://www.itu.int/en/ITU-T/focusgroups/dlt/Documents/FGDLT-deliverables.zip
Following the completion of FG DLT, ITU-T continues working with Blockchain and DLT in the frame of Q22, a subgroup inside of the study group "SG16 Multimedia and e-services" because DLT is considered as a part of e-services: https://www.itu.int/en/ITU-T/studygroups/2017-2020/16/Pages/default.aspx
More info from Q22: http://itu.int/en/ITU-T/studygroups/2017-2020/16/Pages/q22.aspx and https://www.itu.int/ITU-T/workprog/wp_search.aspx?sg=16&q=22
The main work items:
- F.DLS "Requirements for distributed ledger systems", timing 2019
- F.DLT-AC "Assessment criteria for distributed ledger technologies", timing 2020
- H.DLT "Reference framework for distributed ledger technologies". timing 2020
- H.DLT-DE "Digital evidence services based on distributed ledger technologies", timing 2021
- H.DLT-INV "General framework of DLT-based invoices", timing 2021
- H.DLT-TFR "Technical framework for DLT regulation", timing 2021
- H.DLT-VERI "Formal verification framework for smart contract", timing 2021
W3C
W3C has formed a Blockchain Community Group, which is studying and evaluating technologies related to blockchain and use-cases such as interbank communications. Its work is complemented by a group on Blockchain and Decentralized Apps and one on Digital Assets.
W3C created the Decentralized Identifier Working Group (DID WG) https://www.w3.org/2019/did-wg/ URL-based identifiers (URIs) in use on the Web today (2019) require that the identifier be leased from an authority such as a Domain Name Registrar. A Decentralized Identifier (DID) is an identifier that does not need to be leased; its creation and use is possible without a central authority to manage it.
In addition to the "Blockchain Community Group" W3C has also a "Credential Community Group" (https://www.w3.org/community/credentials/) which has developed key standards for SSI (Self-Sovereign Identity) including Decentralized Identifiers (DID) Data model and Syntax and Verifiable Claims Use Cases and Data Model.
IETF IRTF
A Research Group is in formation in the IRTF on the topic of Decentralized Internet Infrastructure (DIN). The Decentralized Internet Infrastructure Research Group (DINRG) will investigate open research issues in decentralizing infrastructure services such as trust management, identity management, name resolution, resource/asset ownership management, and resource discovery. The focus of DINRG is on infrastructure services that can benefit from decentralization or that are difficult to realize in local, potentially connectivity-constrained networks. Other topics of interest are the investigation of economic drivers and incentives and the development and operation of experimental platforms. DINRG will operate in a technology- and solution-neutral manner, i.e., while the RG has an interest in distributed ledger technologies, it is not limited to specific technologies or implementation aspects.
More details of the DINRG are available.
https://trac.ietf.org/trac/iab/wiki/Multi-Stake-Holder-Platform#Ledger
CEN/CENELEC
CEN and CENELEC have established a Focus Group on Blockchain and Distributed Ledger Technologies. The first objective of the Focus Group has been to identify specific European standardisation needs (for example in the context of EU regulations such as GDPR and eIDAS), to map these standardisation needs with the current work items in ISO/TC 307 and to encourage further European participation in ISO/TC 307. The Focus Group has also identified further specific European standardisation needs to be addressed by International standardisation for the successful implementation of Blockchain/DLT in Europe, which are not yet covered by ISO/TC 307. https://www.cencenelec.eu/news/articles/Pages/AR-2018-04.aspx
The Focus Group has developed a White Paper and presented it for consideration to ISO/TC 307. The Focus Group will continue its activities with the identification of relevant European use cases, and will further identify and give due consideration to any relevant European innovation, research project, impacting Blockchain/DLT standardisation. The White Paper is available at the CEN/CENELEC web site.
CEN CENELEC is launching a new Joint Technical Committee JTC19 on Blockchain and Distributed Ledger Technologies. CEN-CLC/JTC 19 is planning to proceed with the identification and adoption of international standards already available or under development and pay attention towards specific European legislative and policy requirements supporting the development of the EU Digital Single Market. The JTC will work in close contact with ISO/TC 307 Blockchain and distributed ledger technologies.
CEN-CENELEC activities also are mirrored at the Member State level, e.g. see DIN in this table.
ETSI
Permissioned distributed ledgers are the kind of DLT best qualified to address most of the use cases of interest to the industry and governmental institutions.
The ETSI ISG PDL is committed to analyse and provide the foundations for the operation of permissioned distributed ledgers, with the ultimate purpose of creating an open ecosystem of industrial solutions to be deployed by different sectors, fostering the application of these technologies, and therefore contributing to consolidate the trust and dependability on information technologies supported by global, open telecommunications networks. The ISG PDL intends to incorporate research and new development results in the field as they become available. The group is actively working to facilitate the coordination and cooperation between relevant standardisation bodies and open source projects.
OASIS
Existing OASIS standards projects with e-commerce applications are being applied to defined blockchain-based serialization methods, as alternative representations of their content (such as e-invoices). See https://www.linkedin.com/pulse/bbiller-supply-chain-blockchain-presentation-slides-ken-holman
UNECE
The United Nations Center for Trade Facilitation and Electronic Business (UN/CEFACT) has developed two White Papers on Blockchain and a Sectoral Use Case paper. The first White Paper provides an overview of the base principles of Distributed Ledger Technology; the second explores the needs for standardisation in this area and concludes a strong needs for semantic data standards in order to ensure clear understanding between the issuer of information on a Blockchain and all users of that data. The UN/CEFACT Core Component Library can cover the data needs in trade transactions. The final UN/CEFACT Blockchain paper explores the specific needs of each sector (Maritime Transport, Suppy Chain, Agriculture, etc.) and provides a number of use cases.
See: White Paper 1 (available also in French and Russian): https://www.unece.org/fileadmin/DAM/cefact/GuidanceMaterials/WhitePaperBlockchain.pdf
White Paper 2 (available also in French and Russian): https://www.unece.org/fileadmin/DAM/cefact/GuidanceMaterials/WhitePaperBlockchain_TechApplication.pdf
Use Case paper: https://www.unece.org/fileadmin/DAM/cefact/cf_plenary/2019_plenary/CEFACT_2019_INF03.pdf
UN/CEFACT CCL: https://www.unece.org/cefact/codesfortrade/unccl/ccl_index.html
UN/CEFACT continues work on interoperability of ledgers. See: https://uncefact.unece.org/display/uncefactpublic/Cross+border+Inter-ledger+exchange+for+Preferential+CoO+using+Blockchain
INATBA
INATBA brings together industry, startups and SMEs, policy makers, international organisations, regulators, civil society and standard setting bodies to support blockchain and Distributed Ledger Technology (DLT) to be mainstreamed and scaled-up across multiple sectors. INATBA has a Working Group on standardisation to liaise with standards development organisations and to develop contributions to standardisation, such as use cases and requirements. https://inatba.org/
Additional information
One direction of blockchains technology innovation in recent years was towards secure persistent public data, eliminating the need for initial trust among involved stakeholders. The potential impact of such a fully decentralized and trust-less distributed ledger is considered enormous.
The clarification and mutual definition of several aspects of blockchain technology (such as blockchain interoperability, governance, trust, security of blockchain and of the underlying cryptographic mechanisms, blockchain compliance to legislation, impact of blockchain on different sectors, etc) are crucial prerequisites to introducing the technology to society.
Global blockchain congress CONVERGENCE: https://blockchainconvergence.com/
[41] CoinDesk's State of Blockchain 2017 Report as cited by Bradley Miles, 6 Trends From CoinDesk's New 2017 State of Blockchain Out Today, 6 March 2017