Legal Daily: Promoting the safe and orderly development of blockchains

• Blockchain is a technology that is jointly maintained by multiple parties, uses cryptography to ensure transmission and access security, and can achieve consistent data storage, tampering, and non-repudiation.
• Blockchain technology application faces five major bottlenecks: lack of typical innovative application of blockchain that can be scaled up; node scale, performance, and fault tolerance are difficult to balance; cross-chain system interconnection still has obstacles; chain data and chain Information consistency is difficult to guarantee; there is a lack of uniform blockchain technology application standards.
• The general secretary stressed that it is necessary to strengthen the guidance and regulation of blockchain technology, strengthen the research and analysis of blockchain security risks, closely track development trends, and actively explore development laws.

□ Legal Daily, full media reporter Du Xiao

□ Intern Yang Meijie

Recently, the Political Bureau of the CPC Central Committee conducted the eighteenth collective study on the status quo and trends of blockchain technology development. Xi Jinping, general secretary of the CPC Central Committee, emphasized that the integrated application of blockchain technology plays an important role in new technological innovation and industrial transformation. We must take the blockchain as an important breakthrough for independent innovation of core technologies, clarify the main direction, increase investment, focus on a number of key core technologies, and accelerate the development of blockchain technology and industrial innovation.

Blockchain technology is regarded as one of the next generation of global credit certification and value Internet infrastructure. According to the "Blockchain Blue Book: China Blockchain Development Report (2018)" (hereinafter referred to as the Blue Book), countries actively deploy contention standards. right. In the global competition for the development of blockchain standards, some European countries and Asia-Pacific countries are at the forefront.

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What is the relationship between blockchain and people's daily lives? How to ensure the safe and orderly development of the blockchain? In this regard, the "Legal Daily" reporter interviewed relevant experts.

Distributed ledger is difficult to tamper with

Promote information to be true

The general secretary pointed out that blockchain technology applications have been extended to digital finance, Internet of Things, intelligent manufacturing, supply chain management, digital asset trading and other fields. At present, major countries in the world are accelerating the development of blockchain technology. China has a good foundation in the field of blockchain. It is necessary to accelerate the development of blockchain technology and industrial innovation, and actively promote the development of blockchain and economic and social integration.

Public information shows that the blockchain originated in Bitcoin. On November 1, 2008, a self-proclaimed Satoshi Nakamoto published "Bitcoin: A Peer-to-Peer Electronic Cash System" article, which describes P2P-based network technology, encryption technology, time stamping technology, and districts. The concept of electronic cash system architecture such as blockchain technology marks the birth of Bitcoin. Two months later, the theory entered the practice. On January 3, 2009, the first creation block with the serial number 0 was born. On January 9, 2009, the block numbered 1 appeared, and connected with the creation block of serial number 0 to form a chain, marking the birth of the blockchain.

The Blue Book believes that the blockchain core technology components, including the basic components, protocols and algorithms that the blockchain system relies on, can be further subdivided into storage, communication, consensus mechanisms, security mechanisms, and so on. The times are constantly improving, and blockchain technology is constantly iterating. Storage is evolving from a single key-value database to a converged blockchain, IPFS, relational database, distributed database, and more.

The Blue Book also mentions that blockchain and cloud computing combine to achieve customized and diversified services. On the one hand, pre-configured networks, common distributed ledger architecture, similar identity management, underlying logic of distributed business monitoring systems, similar IoT node connection logic, etc. are modularized, abstracted into blockchain services, and supported externally. From the upper-level applications of different customers, it can quickly build a blockchain service platform with cloud computing to quickly verify the feasibility of concepts and models; on the other hand, use the existing basic service facilities of cloud computing or make adaptive adjustments according to actual needs. It can accelerate the development of application processes and reduce the deployment cost, and meet the service needs of the participating entities in the future blockchain ecosystem, such as start-ups, academic institutions, open source organizations, alliances and financial institutions.

Cai Liang, executive deputy director of the Blockchain Research Center of Zhejiang University, told the Legal Daily reporter that the blockchain is a joint maintenance by multiple parties. It uses cryptography to ensure transmission and access security. It can achieve consistent data storage, cannot be tampered with, and cannot be denied. Technology. A typical blockchain stores data in a blockchain structure.

“Commonly speaking, blockchain is a kind of bookkeeping book. This book differs from traditional books in that blockchain is distributed accounting, distributed encryption and distributed storage. For example, a village In the case of a villager’s transaction, he informed the villagers of the transaction through the village’s broadcast, and all the villagers recorded it on their respective books after verification. Therefore, the biggest feature of the blockchain is that it is difficult to be tampered with, credibility. Higher." Deng Jianpeng, a professor at the Central University of Finance and Economics Law School, said.

Cai Liang believes that the blockchain technology is difficult to tamper and traceability. It is suitable for solving the problems of insufficient transparency in the process of traditional social governance and lack of trust in results. It also helps to form an atmosphere of public supervision and promotes the information of all parties. In reality, it is also conducive to demonstrating illegal behaviors and transforming the advantages of modern science and technology into governance effectiveness.

Wide range of applications

Five bottlenecks cannot be ignored

General Secretary Xi Jinping pointed out that it is necessary to seize the opportunity of blockchain technology integration, function expansion and industry segmentation, and play a role in promoting the data sharing, optimizing business processes, reducing operating costs, improving synergy efficiency, and building a credible system. The role. It is necessary to promote the deep integration of the blockchain and the real economy, and solve the problems of difficulty in financing loans for SMEs, difficulties in controlling the risks of banks, and difficulties in departmental supervision. It is necessary to use blockchain technology to explore digital economic model innovation, provide power for creating a convenient, efficient, fair and competitive, stable and transparent business environment, and provide services for promoting supply-side structural reforms and realizing the effective docking of supply and demand in various industries, in order to accelerate new and old kinetic energy. Provide support for continuous transformation and promote high-quality economic development. It is necessary to explore the application of “blockchain+” in the field of people's livelihood, and actively promote the application of blockchain technology in the fields of education, employment, pension, precision poverty alleviation, medical health, commodity anti-counterfeiting, food safety, public welfare, social assistance, etc. The masses provide more intelligent, more convenient and better public services. It is necessary to promote the combination of the underlying technical services of blockchain and the construction of new smart cities, explore the promotion and application in the fields of information infrastructure, smart transportation, energy and power, and improve the level of intelligence and precision of urban management. It is necessary to use blockchain technology to promote greater inter-connectivity between cities in terms of information, capital, talents, and credit information, and ensure the orderly and efficient flow of production factors within the region. It is necessary to explore the use of the blockchain data sharing model to achieve the joint maintenance and utilization of government data across departments and regions, promote business synergy, deepen the “run-up once” reform, and bring better government service experience to the people.

“Currently, blockchain technology has been applied in many fields such as finance, government affairs, social governance, industrial manufacturing, etc., and as the industry's understanding of the value of blockchains and the applicability of scenarios continues to improve, many companies have verified from the original concept. The application of the type gradually turned to practical applications." Cai Liang said.

Yin Zhentao, deputy director of the Law and Finance Research Office of the Institute of Finance of the Chinese Academy of Social Sciences, said that some blockchain technologies are being applied in the medical field. People who go to different hospitals need to take different cases. If these cases can become a database that cannot be tampered with and adjusted, it is very helpful to see patients.

Deng Jianpeng told the "Legal Daily" reporter that the most mature application of the current blockchain is mainly in the financial field. In addition, the application prospects of the blockchain in terms of depositing, verifying, and anti-counterfeiting traceability are also broad.

For example, Deng Jianpeng can use the blockchain to invoice. In the past, there were invoice frauds, including various bills, bank acceptances, money orders, etc., which could be falsified. Now, through the blockchain to invoice and bills, these frauds can be largely avoided.

In terms of anti-counterfeiting traceability, some well-known brands have more fake wines. If a QR code is attached to the product and linked to the blockchain, consumers only need to scan the QR code to determine the true and false of the wine. .

In addition, in the case of judicial deposits, such as the evidence used by Internet courts, it is more troublesome to verify them one by one, but if the electronic evidence is stored in the blockchain before, the court can directly accept the letter at the time of the judgment. There is no need to collect evidence or seek identification from judicial appraisal agencies, which can effectively reduce the workload and provide work efficiency.

Although the blockchain is widely used, the Blue Book also points out that the application of blockchain technology faces five major bottlenecks: the lack of typical innovative applications of blockchains that can be scaled up; the difficulty in balancing node size, performance, and fault tolerance; There are still obstacles in the interconnection of the system; the consistency of data between the chain and the information under the chain is difficult to guarantee; there is a lack of uniform application standards for blockchain technology.

According to the Blue Book, blockchain security issues need to find more solutions. Safety is one of the guarantees of the vitality of the blockchain. The current blockchain is still in its infancy, facing challenges such as encryption, smart contract attacks, code vulnerabilities, and algorithm security. Risks come not only from external entities, but also from internal participants. Building a security system around physics, data, application systems, encryption, risk control, etc. is an important issue currently facing.

According to the statistics of the Blue Book, from 2011 to 2018, the global blockchain lost as much as $2.864 billion due to security incidents. It is worth noting that the loss quota has shown an upward trend since 2017, and the amount of losses has reached $1.9 billion since 2018 alone.

"The development of blockchain technology is still in the early stage of technological innovation. Looking at the status quo of global blockchain technology industry, foreign blockchain technology mainly focuses on the research and development of public chain technology, and China continues to exert its strength in the alliance chain technology. More applications have already had certain leading advantages. At present, domestic mainstream financial institutions and technology companies have accelerated the application of blockchain investment, and launched a variety of blockchain products and services in different fields such as finance, government affairs and social governance. "Cai Liang said.

Cai Liang believes that the current development trend and research hotspots of China's blockchain technology are mainly concentrated in two areas.

“The first is the research and industrial development of the alliance blockchain technology, including the core technology of the alliance blockchain, the research and development of the alliance blockchain platform, and how to serve the social economy, government, and social governance around the alliance blockchain. Secondly, the blockchain supervision technology is also a very important research direction. How to use and manage the blockchain technology is a key issue to ensure the sustainable development of the whole industry."

Improve data encryption authorization

Protect against multiple security risks

General Secretary Xi Jinping emphasized that it is necessary to strengthen the guidance and regulation of blockchain technology, strengthen the research and analysis of blockchain security risks, closely follow development trends, and actively explore development laws. It is necessary to explore the establishment of a safety guarantee system that adapts to the blockchain technology mechanism, and guide and promote blockchain developers and platform operators to strengthen industry self-discipline and implement safety responsibilities. It is necessary to implement the rule of law network into the management of blockchain and promote the safe and orderly development of blockchain.

So, what measures are taken to achieve a safe and orderly development of the blockchain?

In Deng Jianpeng's view, perfecting the encryption and authorization of data can effectively avoid data leakage. “The blockchain itself is distributed encryption. For example, in the medical field, patients go to the hospital for examination, which involves the privacy of the patient. If the personal information is on the blockchain, it can be encrypted. In the case of personal authorization, The other party can see the patient's information, so that the problem of leaking can be effectively avoided."

Yin Zhentao believes that to achieve the risk prevention and control of blockchain, the most important thing is to prevent technical risks and application risks. "The blockchain is a new technology. There have been problems such as leakage of privacy data and attacks, so the important point of blockchain security is technical security. In addition, the blockchain is applied to the existence of real needs. Areas with real value, rather than focusing on virtual currency, are actually opportunities and risks, which means that certain risks will increase further."

In recent years, in order to promote the safe and orderly development of blockchain, China has taken a series of measures:

In 2016, the State Council issued the “13th Five-Year National Informationization Plan”, which listed blockchain technology as a strategic frontier technology.

In June 2018, the Ministry of Industry and Information Technology issued the "Industrial Internet Development Action Plan (2018-2020)" to encourage the application and exploration of emerging frontier technologies such as blockchain in the Industrial Internet.

At the beginning of this year, the National Internet Information Office issued the “Regulations on the Management of Blockchain Information Services” to standardize blockchain information service activities.

Cai Liang believes that from a large perspective, there are no specific laws and regulations for blockchain technology. In the future, we should build a more complete system based on the technical characteristics and application of blockchain, and provide a good institutional guarantee for the development of blockchain technology industry.

Deng Jianpeng suggested that to guide the safe and orderly development of the blockchain, it is necessary to first establish standards and define what kind of blockchain is compliant. In addition, actively promote legal coding. “The blockchain itself is some code. When the code is developed and compiled, the relevant departments can issue some guidelines to properly code some legal elements or elements into the code when compiling the code. Inside, to achieve legal coding, chain chain, blockchain chain to manage the blockchain, so that law enforcement personnel do not need to additionally supervise the blockchain."

In addition, Deng Jianpeng also believes that it is necessary to actively promote the autonomy of the blockchain industry, allow industry associations to formulate governance regulations, and then consider the formulation of relevant laws and regulations on the basis of governance regulations.

In Yin Zhentao's view, after the emergence of a new mechanism or a new model, the biggest problem is actually compatible with traditional mechanisms or models, as is the relationship between blockchain and law.

“The legal system is basically based on traditional mechanisms or models, and the blockchain is a new technology that may conflict with the legal system in some respects. For example, according to conventional legal thinking, evidence may be needed There is a central institution to confirm, and according to the blockchain mechanism, such as settlement, is the accounting between the two parties, without the confirmation of the central organization, then whether such evidence can become evidence of the court, or whether this transaction can Recognized as a real deal, this is where conflicts may arise," Yin Zhentao said.

For the future development prospects of the blockchain, Deng Jianpeng said: "The future of the blockchain is difficult to estimate, especially in the field of lack of credit. At present, there are still some areas for improvement in the market credit system, such as the existence of counterfeit and shoddy products. Blockchain can be used in this field. The application of blockchain is more and more extensive, which can promote the development of the whole social economy and the direction of integrity, and help to improve the credit system."

Cai Liang also mentioned that the blockchain technology will greatly improve the current Internet integrity system and even the social integrity system. Therefore, we should persist in vigorously promoting the application innovation of blockchain technology, and deeply explore the integration and development of frontier information technologies such as blockchain and artificial intelligence, big data, and Internet of Things, and strive to create more blockchain application scenarios and greater innovation. space.

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