Academician of the Chinese Academy of Sciences: China's blockchain core technology is at risk

Author: Mr Cheng, Qiu Wang Jie (Beijing University of Aeronautics and Astronautics, Beijing 100191, China)

Source: National Natural Science Foundation of China

Editor's Note: The original title was "Development Trends and Reflections on China's Blockchain"

Abstract : Blockchain is a trusted system built for the first time in human history, and its core function is to improve the governance capabilities of various latitudes. Recently, the CPC Central Committee has positioned the blockchain as an important breakthrough in independent innovation of core technologies and an effective tool to promote the modernization of national governance capabilities. This article will outline the history of the development of blockchain technology at home and abroad, analyze the core risks and countermeasures for the development of China's blockchain, and make some suggestions for the development of China's blockchain technology.

Keywords: independent innovation; trusted system; national governance system; distributed system

1 Overview of Blockchain Development

Blockchain, as an integrated system of multiple technologies such as peer-to-peer networks, cryptography, consensus mechanisms, and smart contracts, provides a trusted channel for information and value transfer and exchange in untrusted networks, established with its unique trust Mechanism, cross-innovation with new technologies and applications such as cloud computing, big data, artificial intelligence, etc., merge and evolve into a new generation of network infrastructure, and rebuild the industrial ecosystem of the digital economy. On October 24, 2019, General Secretary Xi Jinping emphasized during the eighteenth collective study of the Political Bureau of the Central Political Bureau that "we must take blockchain as an important breakthrough in independent innovation of core technologies, clarify the main attack direction, increase investment, and focus on overcoming Approve key core technologies to accelerate the development of blockchain technology and industrial innovation. "Blockchain is a trusted system built for the first time in human history. Its core function is to enhance the governance capabilities of various dimensions. This also requires our deep understanding and accuracy. Grasp the significance of General Secretary Xi Jinping's organizing the collective study of the blockchain by the Political Bureau of the CPC Central Committee before the Fourth Plenary Session of the 19th Central Committee.

Exploring the origin of blockchain technology, Bitcoin is an unavoidable topic. Blockchain, as a low-level technology, can be traced back to the bitcoin system. In 2008, a scholar (or team) named Satoshi Nakamoto published an article entitled "Bitcoin-A Peer-to-Peer Electronic Cash System" [1] . Bitcoin was established as a distributed trusted system. Digital assets were born. Unlike most currencies, Bitcoin is not issued by a specific institution, but is generated by a large number of calculations based on a specific algorithm. The Bitcoin economy uses a distributed database composed of many nodes in the entire peer-to-peer network to confirm and record all transaction behaviors, and uses cryptographic technology to ensure the security of all links in the digital asset circulation process. The 2009 "Blockchain Intrinsic Technology-Distributed Trusted System" seminar was held in Beijing. The conference adopted "Software Trustworthiness Dynamics and Its Evolutionary Complexity" [2] . The article revealed the distributed trusted software system. The dynamic complexity of this paper explores the basic scientific problems of building a distributed trusted system and the measurement theory of building the system's credibility.

Since the advent of Bitcoin in 2008, the development of blockchain can be roughly divided into three periods, and its application scope has expanded from the original digital currency or assets to all aspects of today's social and economic life. The 1.0 stage is typically represented by digital assets such as Bitcoin, the 2.0 stage is characterized by the application of smart contracts, and the 3.0 stage is characterized by a programmable society. It is currently in the 2.0 advanced stage, and the blockchain is still mainly on a small scale. It is mainly used in local applications, and there are few real industrial and ecological grade landings. When the 3.0 stage is reached, the blockchain will become a social governance tool. With a typical feature of a rule-based trusted intelligent social governance system, the social governance model will be realized from the stage based on the assistance of traditional information technology to the rule of law based on the blockchain order. stage.

The current status of blockchain technology is that foreign countries mainly focus on the research and development of basic blockchain technology platforms or operating systems, and domestically focus on the development of blockchain applications. China's enterprise application development mainly relies on the results of foreign open source communities, and no autonomous and controllable underlying blockchain architecture has yet emerged. According to the "Trusted Blockchain Standard Test Report" released by the China Academy of Information and Communications Technology in October 2018, half of the test vendors used the underlying platform of the Hyperledger blockchain led by IBM. Unlike previous information technologies, the blockchain technology, which is characterized by rule governance, has a strong expansion. Therefore, the core objective of promoting the healthy development of China's blockchain technology and industry is, first of all, the urgent need for independent innovation of the underlying platform and the underlying technology that is autonomous and controllable in advance.

2 Blockchain technology and theoretical analysis

Blockchain technology is essentially a distributed and trusted system.The research on the core technology of the next generation of blockchain includes five directions: consensus algorithm optimization balance, security and privacy protection, contract credibility, scalability, and cross-chain technology. , Corresponding to distributed computing theory, cryptography theory, software credibility theory, heterogeneous system interaction theory and operational research and parallel theory system. Only by starting with the basic theory and innovating China's independent, secure and controllable blockchain platform, can we master the right to speak of blockchain technology and standards worldwide, and realize the integration of theory-technology-engineering-platform-standard blockchain Distributed trusted sovereignty system.

2.1 Consensus optimization balance

The goal of the blockchain consensus mechanism is to make all honest nodes keep a consistent view of the blockchain, while satisfying two properties at the same time: one is consistency, the amount of the blockchain stored by all honest nodes is exactly the same; the second is effectiveness The incremental information issued by an honest node will eventually be recorded in its own blockchain by all other honest nodes. Different consensus mechanisms are used on the blockchain, which will affect the overall performance of the system differently while satisfying consistency and effectiveness. We can evaluate the technical level of each consensus mechanism from the following three dimensions: (1) security, whether it is capable of resisting attacks from participants with certain resources and influence; (2) scalability, that is, nodes The more the whole system has the ability to process transactions; (3) the degree of distribution, that is, the access thresholds and rights of nodes. There is a ternary paradox in the consensus mechanism, that is, in a blockchain system, the three cannot be both scalable, distributed, and secure. Therefore, how to find a balance in the ternary problem is the key to designing the next generation consensus mechanism.

2.2 Security and privacy protection

In the public chain, it is necessary to protect sensitive information such as transaction data, addresses, and identities, while allowing accounting nodes to verify the legitimacy of transactions; for the alliance chain, while constructing a privacy protection scheme, it is necessary to consider the regulatory / Authorization tracking. We can achieve transaction identity and content privacy protection by using efficient cryptographic primitives and schemes such as zero-knowledge proofs, commitments, and indistinguishable evidence; privacy protection mechanisms based on cryptographic schemes such as ring signatures and group signatures, and hierarchical certificate mechanisms The privacy protection mechanism is also an optional solution; the privacy protection of transaction content can also be achieved by using an efficient homomorphic encryption scheme or a secure multi-party computing scheme; a simple currency protection can also be achieved by using a mixed currency mechanism [3] .

2.3 Contract credibility

Smart contract is a prediction of the core logic of the business scenario described by the blockchain. Contract credibility has become an important trend and an inevitable choice for the development and application of blockchain technology. Contract credibility modeling has become the key to constructing a trusted blockchain. Prerequisites and necessary means. In order to explore and clarify the basic scientific issues of contract credibility and establish the theoretical basis of contract credibility measurement, the credibility of contracts and its evolution law can be explored in conjunction with the basic ideas of dynamic systems, and research is performed under various internal and external factors The dynamic mechanism of contract credibility evolution and the establishment of a corresponding dynamic model, so that the credibility of the smart contract system can be considered as a statistical characteristic of the blockchain's behavior in a dynamic and open environment. Through modeling analysis, the correspondence between the extreme evolutionary behavior of the contract's credible attributes and the characteristics of the dynamic system can be explained, so as to interpret the dynamic characteristics of the smart contract and its evolutionary complexity. On the other hand, we can use the dynamic statistical analysis method to give an invariant measurement evaluation method of contract credibility statistical indicators and contract untrustworthy dynamics criteria [4] .

2.4 Scalability

For the blockchain (especially the public chain) to really achieve in-depth application and popularization, the key is to solve the problem of transaction throughput and transaction rate, which we call "scalability." Scalability aims to improve the overall performance efficiency, capacity expansion, or functional expansion on the basis of the distributed ledger protocol. It mainly includes shard extension and hierarchical extension technologies: (1) shard extension. The blockchain network consists of the main chain and the shard chain. The transactions on the shard chain are in their own independent space. The core idea is that each node only needs to process transactions within the block, not the entire network. (2) Layer extension. A state channel is a layered technology. Its core idea is to allow execution of off-chain transactions. What happens in a state channel still maintains a very high level of security and finality. If any problems occur, you can still choose to backtrack to Arbitration on the main chain.

2.5 Cross-chain technology

Blockchain is a type of distributed ledger. A blockchain is an independent ledger. Two different chains are as if the two ledgers are not related. Therefore, there is essentially no way to transfer value between the ledgers. However, for a specific user, the user stores it on a blockchain. Value needs to be able to be transferred to the value on another chain, which is the cross-chain asset circulation. Cross-chain asset circulation allows value to cross the barriers between chains for direct circulation. Cross-chain is essentially the same as currency exchange.Cross-chain does not change the total value of each chain, it just exchanges between different holders. Further, a cross-chain distributed transaction refers to that multiple steps of a transaction are dispersed and executed on different blockchains, and the consistency of the transaction is required to be guaranteed. This is an extension of the cross-chain asset circulation, extending the behavior of asset exchange to arbitrary behavior. And cross-chain distributed transactions make cross-chain smart contracts possible. A smart contract can be executed on multiple different blockchains, or all of them have been executed, or all of them have returned to the state before execution. Cross-chain smart contracts will break the information island effect between chains and greatly expand the application scenarios of the blockchain.

3 Blockchain development risks and responses

At present, the development status of China's blockchain technology is that there are many patents and few codes, no independent security and controllable underlying platform, and no software and hardware integration platform, which will directly lead to the core technology of the blockchain being subject to human technological risks and foreign open source platforms to seize the financial market. Financial risks and economic risks of foreign open source platforms penetrating China's physical and virtual economy. Here we take the Libra platform as an example to analyze and give the corresponding coping strategies. Global social giant Facebook's cryptocurrency project Libra released a white paper on June 18, 2019. Libra's mission is to build a simple and borderless digital currency on the one hand, and a financial infrastructure that serves billions of people on the other. The inclusive financial system built by Libra can be summarized into three major factors: (1) Libra is built on the basis of a secure, scalable, and reliable blockchain. From a technical perspective, Libra has adopted the development of the blockchain and is relatively mature. (2) Libra is different from digital currencies such as Bitcoin, which has no intrinsic value, and its intrinsic value is based on a basket of reserve financial assets, which has the characteristics of low volatility; (3) Libra is governed by the independent Libra Association, which The mission of the association is the operation of the blockchain platform, the management of reserves, and the promotion of the Libra financial ecosystem. At present, Libra is a multi-centric permitting network platform, and according to its development plan, it will transition to decentralized non-permissive in the future. network platform. In the final analysis, Libra's ultimate goal can be boiled down to "a chain, a coin, and a smart contract platform", with the chain as the basic operating system, the currency as the payment method, and the smart contract platform used to build ecological applications.

At present, most people in the industry interpret Libra as an open, instant and low-cost global currency system. For China, Libra may challenge China's current monetary policy because of its low cost, short time, high efficiency, and wider coverage: (1) A basic requirement for foreign exchange management in China is to emphasize that foreign exchange transactions must be authentic Transaction background, and the Libra platform cannot give a judgment of authenticity; (2) illegal cross-border capital flows may increase; (3) Libra anchors sovereign currencies such as the US dollar, and Libra's promotion will simultaneously support the US dollar and strengthen the dominant position of the US dollar (4) squeeze the space for RMB internationalization; (5) may expand the scope of US long-arm jurisdiction, Libra has 50% of the US dollar reserve, and the US dollar ’s long-arm jurisdiction will expand significantly following Libra; (6) squeeze the global cross-border Foreign small remittance business.

At present, everyone's concerns about Libra mainly focus on the challenges to China's monetary policy, and we have some deeper concerns. We noticed that Libra not only built a digital currency, but also built a set of smart contract platforms. A Turing-complete smart contract platform means that the Libra platform can build arbitrary applications like the Windows system and Android system, covering any Industry and business. At this stage, the Internet is developing rapidly in our country, and China has a high degree of informatization. Almost all industries cannot rely on information systems. If the information systems in these industries are replaced by the Libra platform, the consequences will be disastrous. Therefore, we do not think that Libra can be simply interpreted as a payment and clearing and settlement tool, but we should see that Libra will be sufficient to support any form of cross-border, cross-industry, cross-sector, and multi-type (B2B, B2C, C2C) economy activity. What we should be alert to is that almost all virtual economies may move into the Libra platform, and at the same time, a considerable part of the business processes of the real economy may also deploy business systems with the help of the Libra platform. The economy is the primary task of China's development. The Libra platform may seize the information and payment business of China's economic development, so that China's economy runs on a platform that is not regulated and controlled.

If Libra is a global extension of the will of the United States and the United States dollar, then an autonomous, controllable and secure blockchain is a global extension of China's national will. The Internet has gone through several stages of information interconnection, interconnection of all people, and interconnection of all things. In the early days of the development of the Internet, the United States introduced the Internet and made it an international standard, thereby mastering the right to speak in the Internet world. To develop a new generation of information industry. At this stage, the world is at the beginning of the era of value interconnection. The blockchain is building a value Internet that serves the real economy and the virtual economy. In this round of competition, China should launch an autonomous, controllable and secure blockchain as soon as possible, As the main chain, it also launched a series of international and domestic technical standards, interface standards, and application standards of the blockchain, reflecting the national will and governance rules, and regulating and restricting the development and application of domestic blockchains through technical standards and application standards. The seamless connection between the main chain and the application platforms is achieved through interface standards, and the goal of "finding the chain with the chain and governing the chain with the chain" is finally achieved. While launching the main chain, we also need to consider launching alliance chains between countries serving the “Belt and Road” strategy. The national alliance chain aims to gain the trust of countries along the “Belt and Road” technology from a technical perspective, and based on mutual consultation and co-construction The shared model realizes the community of human destiny from the technical dimension, and realizes the national consensus on the concept of international power, common interests, sustainable development and global governance.

4 Blockchain and modernization of national governance capabilities

General Secretary Xi Jinping emphasized the seven "essentials" such as "to promote the deep integration of the blockchain and the real economy", which pointed out the direction for the development and application of blockchain technology in China, and made a deep integration of the blockchain into various practical application scenarios. With the deployment, we can attribute the application value of the blockchain to the five common functions of promoting data sharing, optimizing business processes, reducing operating costs, improving collaboration efficiency, and building a trusted system. From the perspective of local provinces and cities, it is possible to combine the seven "requirements" with the actual conditions of the provinces and cities, and use one ecology or industry as an entry point to promote and promote the healthy development of ecological applications in other fields. We must see that the reason why the CPC Central Committee attaches great importance to blockchain technology is because it values ​​its application prospects in the real economy, people's livelihood and national governance. This has also set specific goals for government departments at all levels in the area of ​​"blockchain" for regional industrial transformation, improvement of people's livelihood services, and government governance upgrades. Government departments at all levels should compare the seven "essentials" to allow the "invisible hand" of the market to play a decisive role, better play the role of the government's "visible hand", promote the flow of related resources to technology research and development and practical applications, and guide talents and funds To projects that can actually improve production efficiency, speed up the continuous conversion of old and new kinetic energy, to areas that actually improve people's livelihood services and public service levels, and improve people's sense of access, to real-world smart city construction and government data sharing. field.

We must strive to use blockchain to improve the level of social governance. The consensus mechanism and smart contracts in the blockchain can create transparent, trustworthy, efficient and low-cost application scenarios, and build an intelligent mechanism for real-time interconnection, data sharing, and collaboration to optimize the processes of government service, city management, and emergency support. To improve governance effectiveness. For example, relying on the blockchain to establish a cross-regional, cross-level, and cross-department regulatory mechanism can help reduce regulatory costs and open up information barriers between regulatory agencies in different industries and regions. When the audit department, tax department, and financial institutions and accounting institutions share audit data, tax reporting data, capital data, and accounting data through blockchain technology, problems such as data fraud and evasion of supervision will be effectively solved.

5 Prospects for China's Blockchain Development

General Secretary Xi Jinping has pointed out to us the development direction of blockchain technology in China. General Secretary Xi Jinping proposed to accelerate the development of blockchain technology and industrial innovation, and actively promote the development of the integration of blockchain and economy and society. To achieve two developments, the key lies in two points: First, the core technology breakthrough of blockchain technology. Blockchain technology is currently the technology with the smallest gap between China and Europe and the United States. Therefore, General Secretary Xi Jinping especially emphasized that in this emerging field, China must be at the forefront of theory, occupy the commanding heights of innovation, and obtain new industrial advantages. It is necessary to promote collaborative research, accelerate breakthroughs in core technologies, and provide safe and controllable technical support for the development of blockchain applications. At present, most of the blockchain technology stays in the concept hype stage, and many business scenarios block the blockchain solely for the purpose of blockchain. So far, no one in China has been able to solve the core technical dilemmas such as the ternary paradox on a global scale. Therefore, we must return to the basic theory and core technology, and through long-term research, we can achieve a major breakthrough. In fact, General Secretary Xi Jinping put forward very high requirements for blockchain technology theory and subsequent application development. Do a good job of blockchain basic theoretical research, focus on overcoming a number of key core technologies, and really pick up the burden of technology research and development. Is the key to the current development of the blockchain.

The second is to enhance the right of international discourse and rulemaking. From the above, we can see that, unlike previous information technologies, blockchain technology has a strong expansion, or aggressiveness, and its rules or the right to speak determine its scope of influence, because each on-chain development Business entities or institutions must obey the rules set by the blockchain, both at home and abroad. For example, everyone must obey the rules of windows when using the windows system, but windows only stipulates the rules for information interaction for users, which is acceptable to us, and the blockchain stipulates industrial governance rules. With its distributed characteristics, the governance rules of the blockchain can quickly surpass national and regional restrictions.

In order to achieve the above two points, we must strengthen the construction of the talent team, establish and improve the talent training system, create a variety of high-level talent training platforms, and cultivate a group of leading figures and high-level innovation teams. Blockchain, as an architectural innovation technology, has a huge demand for compound talents, and requires participants to master a variety of professional technical knowledge related to cryptography, information science, basic mathematics, and so on. To develop the blockchain, it is necessary to strengthen the construction of a talent team with deep cross-disciplinary integration, and to prospectively and systematically establish a talent cultivation system from basic research, applied research and development, and industrial integration.

references

[1] Nakamoto S. Bitcoin: a peer-to-peer electronic cash system. Consulted, 2008.

[2] Zheng Zhiming, Ma Shilong, Li Wei et al. Dynamic characteristics of software credibility and its evolutionary complexity. Science and Information Sciences in China: Science in China, 2009, 39 (9): 946—950.

[3] Yao Qian. Review of Blockchain Research Progress. China Information Security, 2018 (3): 92-95.

[4] Zheng Zhiming, Ma Shilong, Li Wei, et al. Trustworthy complexity of software and statistical analysis method of its dynamics. Science and Information Science of China: Chinese Science, 2009, 39 (10): 1050—1054.

About the Author

Zheng Zhiming: Professor of Beijing University of Aeronautics and Astronautics, academician of the Chinese Academy of Sciences, head of the national next-generation artificial intelligence group intelligence team leader, director of the State Key Laboratory of Software Development Environment and director of the Key Laboratory of Mathematics, Information, and Behavior of the Ministry of Education. The earliest proposed model of the distributed and trusted system of the blockchain in China, and proposed the ternary optimization and balance strategy of the blockchain. He has won the first prize of the National Technology Invention Award, the Heliang Heli Science and Technology Progress Award, the first prize of the Ministry of Education's Natural Science Award, and the first prize of National Defense Technology Invention Award.