eMagazine Dutch Blockchain Coalition

Blockchain is a new technology and method of operation that enables the safe exchange of data and payments. The partners of the Dutch Blockchain Coalition explain in this eMagazine how they collaborate to turn blockchain into a reliable and future-proof technology.

Preface René Penning de Vries

Blockchain is digitised trust

Patient data that is safely sent from one hospital laboratory to another. Electric cars that are charged without any administrative hassle. Smart contracts that ensure that freight consignments from container ships are efficiently transported on from the Rotterdam harbour via road, water and rail. These are all applications that will help our society to advance and in which blockchain can play a significant role.

Blockchain is a relatively new information technology with the potential to exchange data securely and efficiently in a decentralised manner. That offers opportunities not only for saving costs but also for developing new revenue models and providing consumers and citizens with more control over their data.

Blockchain is currently still in its infancy and there is still a lot of uncertainty about the opportunities and pitfalls. The technical expertise in this area is also still limited and greater clarity is needed regarding the changes in relevant legislation.

Blockchain is giving rise to exciting new questions. One such example is the removal of a central authority. Will smart contracts soon be able to take over the work that is currently done by third parties such as banks, solicitors and accountants? And if so, do we want that as a society? Will the applications mainly lie in the area of transactions between companies or also in new services provided to consumers? However, are such services feasible in terms of bandwidth and computer capacity, if the blockchain network acquires millions of nodes and needs to deal with thousands of transactions per second?

With blockchain we are now in the initial phase of what could possibly be a spectacular new information revolution. Therefore on 30 March 2017, the public-private initiative Dutch Blockchain Coalition (BC3) was launched in which more than twenty partners from the sectors banking and insurance, logistics, energy, security and knowledge as well as ministries and supervisory bodies such as the Nederlandsche Bank (DNB) and the Royal Notary Association (KNB) have joined forces. Together they are realising an action agenda to ensure blockchain becomes reliable and future-proof technology that is easy to scale up. The priorities from the 2017 agenda are strong digital identities, internationally accepted standards, training talent, sharing knowledge, and tackling possible obstacles including legislation. Identity is a necessary condition for the introduction of each blockchain application and it is therefore the first item addressed.

Many parties, both large and small, are interested and this further increases the impact of the technology. In the national approach the coalition will work with initiatives from start-ups (such as Dutchchain/Dutch Blockchain Hackathon) and larger regional field labs (such as Brightlands in Heerlen and Blocklab in Rotterdam). However new partners are also welcome and they can contribute to the coalition as a key partner, research partner or training partner.

In this magazine you can read all about the ambitions of the Dutch Blockchain Coalition, our action agenda 2017, and the use cases that our partners are already working on. You can also read interviews with several experts from the coalition about the importance of legislation and good communication with respect to the impact of blockchain on our everyday lives.

I am very pleased about the initiative of the national coalition with its huge diversity of partners. This coalition offers a fantastic opportunity to realise major opportunities and changes for the top sectors within the foreseeable future.

If a constructive collaboration between all parties enables the Netherlands to implement blockchain as the system of digitised trust, this will be something unique that has scarcely occurred in other parts of the world!

René Penning de Vries,
Chairman Team ICT

Blockchain explained in five blocks

Blockchain is a new technology and approach for the secure exchange of digital data and payments. It is difficult to abuse the technology because each transaction is checked by several computers and it is completely transparent without the intervention of a third party. Blockchain can strengthen the autonomy of citizens, reduce the administrative burden and increase digital security. Here you can view a short explanation.

Block 1: What is blockchain?

A blockchain is a chain of digital files (the blocks or links) that are linked together. The entire chain is in turn a digital file. A blockchain is never finished, as participants in a blockchain can always attach new links to the chain. However once added, links can never be removed again.

A chain can contain anything: a contract, a patent, a deed of ownership, or a piece of software. And even digital money – Bitcoin is the most famous – uses a blockchain to ensure a digital coin can never be used twice by the same owner.

Consensus

Participants cannot be allowed to randomly add links to the chain, as the chain would then acquire branches, and there would no longer be consensus about what the real blockchain is. Each time a participant wishes to add a new link, the network of participants must first verify that the chain is still intact and only a single unique version exists. This also guarantees that the current version of the blockchain is still known to all participants. When the new link is added, a new unique version of the blockchain is formed.

A network without central authority

The cryptographic security of a blockchain is usually subtle and complicated. Everyday ‘blockchains’ without this complicated security also exist, however, and many people use these on a daily basis. One such example is a group of people who email each other with all members of the group in the cc. As senders cannot change emails in retrospect, everything is recorded in an unequivocal and transparent manner, also with respect to chronology. In an email you can request a confirmation of receipt from the recipient. If everybody is first required to send a confirmation before a subsequent email can be sent to the group, then at any moment in time there is formal consensus about the entire email exchange. This produces a sort of public register or public ledger in which each participant can look back at what has happened.

There is, however, a fundamental difference with a real blockchain: the participants are dependent on a central authority, namely the email provider. If such an email group discusses something important they must trust the provider will not 'listen in' or change or delete messages. The cryptographic security of a real blockchain means that no central authority is needed. All participants check each other with digital ‘DNA profiles’ of files and digital signatures, resulting in mutual trust in the integrity of the blockchain. (see Block 2).

A blockchain can be permissionless or permissioned. Permissionless, or public, means that everybody can participate (if necessary anonymously). In a permissioned blockchain a person may only participate following the approval of the earlier participants or the central authority. A hybrid form is also possible in which there are several categories of participants with different rights.

‘’A big promise of Blockchain is the fact that clients will have more autonomy regarding their own data.‘’
Alliander - Berrie Staring

‘’The potential of blockchain technology is enormous. We envisage many application possibilities for blockchain technology to improve the service to our clients and suppliers.‘’
ABN AMRO – Marjan van der Plas

Dutch Blockchain Coalition - Ambition and working method

Blockchain is a valuable technology but a lot still needs to happen at the technical, societal and legal levels. The Dutch Blockchain Coalition is testing the possibilities, investigating the legislative aspects, and developing a Human Capital Agenda. With these efforts we are seeking to ensure that blockchain will be a reliable and future-proof technology. Twenty partners from the sectors financial services, insurance, logistics, energy, security and knowledge as well as supervisory bodies like the Nederlandsche Bank (DNB) and the Royal Notary Association (KNB) have joined forces in the coalition. They have drawn up an action agenda to work on blockchain in the coming years, from building prototypes and realising a Human Capital Agenda to debating the legal and commercial aspects.

The opportunities

The partners from the coalition see opportunities to use blockchain to develop a reliable and secure digital exchange system. Penning de Vries: ‘Our society is based on trust. Each transaction and each proof of ownership is related to trust in underlying systems. Blockchain holds the promise of being able to digitise and secure these processes and ensure they are no longer falsifiable.’ - video

The coalition expects positive effects for the key sectors in the Netherlands such as energy, health, logistics, the financial sector and public services. Examples are the smart management of energy flows in and around the home, the rapid tracing of goods in a port, and international payments in real-time. All of these are applications that will help our society to advance.

National approach of blockchain

It is important that the knowledge sharing and talent development associated with this new technology are tackled at a national level. Many issues associated with blockchain, such as the construction of secure and reliable digital identities, are important for each sector. By sharing knowledge at a national level, the Netherlands will also be in a better position to anticipate the economic and societal changes that blockchain will bring about. Examples are new revenue models in industry or new types of collaboration between energy suppliers and consumers. As these will affect the entire chain, it is smart in a public-private context to pinpoint areas of concern and to subsequently tackle these.

Public-private

The Netherlands has a long history of excelling in public-private-partnerships. Business parks, campuses and field labs are geographically close to each other, enabling public and private parties to easily find each other so that new collaboration models can arise which can count on widespread support.

Action agenda

The agenda 2017 has three lines action.

  • In the first line of action efforts will be made to realise strong digital identities that are secure, reliable and internationally applicable. This will be based on self-sovereign (autonomous) digital identities and open source architecture so that prototypes and demos can also be shared with partners outside of the coalition.
  • A second group will investigate the right conditions for the reliable use of blockchain applications. Such conditions include appropriate legislation, satisfactory supervision and societal acceptance (Line of Action 2).
  • In Line of Action 3 (Human Capital Agenda) the focus is on training, sharing knowledge and increasing skills. Examples are the new professions that will arise such as legal coders: lawyers who can also program. Educational establishments and training centres must be able to anticipate such needs. You can read more about these three lines of action in the action agenda.

Research Science Communication

The coalition is being supported by researchers from Delft University of Technology and Radboud University who will make an inventory of the issues that play a role in the public arena of media-politics-policy.

Examples of such issues are privacy, encryption and security. In which phase of the development of blockchain will the issue play a role? Which interests are there? What does this mean for the public support of the technology?

An important aspect is an inventory of the current frames (perspectives) that are used in the media. These frames largely reflect what society currently thinks about Blockchain and are therefore narratives that the coalition can take into account.

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Slide from the research proposal of Delft University of Technology and Radboud University


To pick up signals from society, the coalition wants to talk with stakeholder organisations such as the Consumentenbond, ANWB, Vereniging Eigen Huis and the Patiëntenfederatie Nederland (previously NPCF).

Home base

A home base has been established on the campus of Delft University of Technology since September where blockchain specialists can collaborate on research and blockchain solutions for concrete questions from industry and the government. Professionals from government bodies and industry can also follow courses here to apply blockchain technologies in their daily work. Furthermore, international guests will be invited to come here and they can request a temporary workplace.

Also interested in participating? Read here about how you can come on board

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Opening of the home base by the Dean of the Faculty of Electrical Engineering, Mathematics and Computer Science, John Schmitz, together with professor Dick Epema (software engineering) and assistant professor Johan Pouwelse (distributed systems).

John Schmitz, Dean of Faculty of Electrical Engineering, Mathematics and Computer Science: “I am pleased that the Dutch Blockchain Coalition has chosen to locate on the campus of Delft University of Technology. The coalition is now located just a stone's throw way from the Faculty of Electrical Engineering, Mathematics and Computer Science. This will undoubtedly lead to a fruitful interaction in the area of this important, young technology.”

How do our partners make use of blockchain?

The use cases from our partners illustrate how active industry, government and institutions in the Netherlands are in experimenting with blockchain as well as the broad diversity of application areas. Our partners explain how they acquired the knowledge, which opportunities and concerns they see, and when they think they can realise practical applications.

USE CASE 1
National Office for Identity Data (RvIG)

André de Kok: 'Enabling citizens to manage their own identity data'

"The National Office for Identity Data is responsible for managing identities, identity data and the carriers of (travel) documents for people who are registered as individuals by the Dutch government. In a rapidly changing society in which the relationship between reality and the digital world is becoming increasingly intertwined, we are examining which added value we can provide at the identity level and which technologies can assist us in this. Security and privacy take centre stage in this; after all we are dealing with privacy-sensitive data from real people.

Privacy and data minimalisation

In our role as a chain manager we believe that an additional service of reliable convenience is necessary to provide the citizen with more control over his identity and the data related to that in the digital world. We believe that blockchain is an opportunity-rich technology that can offer this additional service. The guiding principles we follow with respect to this originate from the worldwide development of Self-Sovereign Identity in which people are placed centre stage and can determine with who they want to share what and when. All of this takes place in a secure manner with the maximum retention of the individual's privacy. Our ideal vision of the future is that a teenager will soon be able to use his phone to prove to a seller of alcohol that he is older than 18 years without the need to reveal any of his personal data. This approach enables privacy and data minimalisation to become the standard again and gives people greater control.

The development of the identity track within the Dutch Blockchain Coalition is currently being tackled under the leadership of Delft University of Technology (Dr Pouwelse) in collaboration with partners such as Techruption, TNO, the Rabobank, ING and Alliander. Fundamental is that the facility satisfies the basic premises of Self Sovereign Identity, it is entirely open source and will become an international standard (IETF). We will not only develop the standard but will also combine it with the identities of objects and organisations. A relevant party that we are working with within this context is the Dutch Chamber of Commerce (identities of organisations). The combination and testing in everyday practice will be realised in association with municipalities. That is why we are starting a strategic collaboration with Brainport and the city of Amsterdam. We have also asked the Association of Netherlands Municipalities to contribute by reflecting on an administrative level about how we can enable other municipalities to participate as well.

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With a fingerprint a teenager proves he is old enough to buy alcohol. Source: National Office for Identity Data

Economic and social benefits

At the National Office for Identity Data, we want to do more than just improve people's security and privacy in the digital world. We also think it is important to explore the legal framework and legislation and, if necessary, to expand this so that people can assume a new, safe position in the digital world. In that context agreements will also need to be made about how such a new system could actually be used by people, companies and government organisations.

The National Office for Identity Data is proud to be part of the Dutch Blockchain Coalition that is working hard on realising this essential part so that the full potential and benefits of the functional use of blockchain possibilities will yield economic and societal benefits."

‘’Blockchain provides new and low threshold possibilities for parties to work together – worldwide, in a secure manner and without being dependent on and paying overheads to trusted third parties.”
Centrum Wiskunde & Informatica (CWI) – Marc Stevens

“In the energy system of tomorrow, energy is a basic right and revenue models will no longer play a role. We see blockchain as one of the highly promising building blocks for realising this system.’’
Enexis – Pieter Janssen

Block 2: Why is it impossible to falsify a blockchain?

Blockchains are made secure using several cryptography techniques. The most important of these is a technique that calculates a kind of ‘DNA profile’ for each digital file, a unique code of 78 figures. This code is called the hash (or hashcode). A hash is also a digital file and so it can be added to another digital file and then the hash can be recalculated for the entire chain.

Each file receives its own unique hash so that it is impossible to create another file with an identical hash. The hash itself however, says nothing about what that file contains. Each hash has an identical length and therefore even the difference between an email of a few words or a database of many gigabytes cannot be deduced from the hash.

This forms the backbone of the blockchain principle: calculating the hash for each file, adding that link to the blockchain, calculating the hash of the entire chain up until that moment and adding that to the chain as well. With this approach, each new link added to the chain is 'digitally welded on', creating an unbreakable chain of files.

USE CASE 2
TKI Dinalog

Martijn Siebrand: “Blockchain technology is being used to work on new revenue models for the logistic service provider and in the short term we will already realise a reduction in the chance of fraud in the area of financing.”

“The role of the logistics service provider in business transactions is increasing. We are seeing a switch from the simple transport of goods to the role of director and facilitator of various services. Blockchain can play a major role in the switch, especially in a chain with several suppliers and customers. It provides an opportunity for the logistics sector in the Netherlands to take on this directive role and to consider how we can realise other business and revenue models with the help of blockchain.

From within the Top Consortium for Knowledge and Innovation Dinalog (TKI-Dinalog) we have worked on a Logistics Consortium that has started to experiment with blockchain technology and has realised proofs of concept with the aim of providing working innovative services. This consortium with members from different sectors is unique in the world. This consortium is currently working on several use cases. The use cases are in the areas of stock financing, instant payment of the logistics service provider and the circular economy. It is expected that by autumn 2017 the sector will encounter a growing number of concrete applications that go further than the current use cases, such as the release of containers.

Double spending

What makes blockchain so interesting is that it can facilitate technology processes by offering (guaranteed) digital trust, also across national boundaries. All transactions are permanently recorded and are given a unique code (the hashcode). A transaction can concern an incoming or outgoing container, a transfer of ownership or a payment.

Furthermore, once a hash code has been issued it cannot be re-issued, which means that double spending or the submission of double claims to an insurer will become a thing of the past. This means that in the short term we will already realise a reduction in the chance of fraud in logistic processes.

Thanks to a grant from the Top Sector Logistics, an invoice registration system based on blockchain was previously realised to uniquely register rights of pledge to claims. This meets a need in the current trend where several parties purchase or finance individual invoices. Currently, creditors cannot see whether they have received the first or second right of pledge, so there is a risk that an invoice is offered to several parties for financing. By linking an individual hashcode to an invoice, the purchasing party can see whether the claim is still free or whether it has been financed already. This also counteracts fraud and increases financing possibilities.

Smart Contracts

Smart contracts are another very interesting opportunity for the logistics sector. In the smart contract, the compliance – the applicable legislation- can be pre-programmed into the contract. The contract can then execute itself with the help of blockchain technology. For example, it can be used for the transfer of valuable documents between parties that have never previously done business together and so have not yet built up a relationship of trust. It will also be possible to create marketplaces for supply and demand without the need to make use of a third party.

The far-reaching degree of transparency blockchain guarantees will yield numerous benefits for society, such as reduced complexity, lower costs and time savings. Furthermore, the citizen will acquire greater control over his personal data. For example, when a property is purchased, he or she will be able to grant the mortgage lender, estate agent, solicitor, the Cadastral Agency, the municipality and the seller temporary access to the desired data. As soon as the transaction has been completed the citizen can once again close off access to that data.

The advantage of this approach is that data for all relevant parties can be made available from a single source. This removes the need to repeatedly share the same data and to keep on answering the same questions for different parties.

“Blockchain and the notary sector need each other to make the connection between trust in the analogue and digital worlds possible.”
Royal Dutch Association of Civil-law Notaries (KNB) – Bernadette Verberne

“Blockchain is more than just a technology. It is expected that blockchain will have an enormous impact on our society, political system and administration, organisations and individuals.”

Port of Rotterdam – Bas van Dijk

The ecosystem in The Netherlands

The Netherlands has always enjoyed a strong reputation in the logistics, financial services, health, and energy sectors. Sectors that are directly influenced by the consequences of blockchain. Blockchain offers these sectors unique opportunities that will fundamentally change society in ways that we do not yet fully comprehend. New services will arise in sectors that are currently dependent on intermediaries, such as banks or insurance companies and from which companies, government and society will benefit.

Furthermore, unique opportunities will arise for government organisations. Now that solutions with blockchain are mature enough to be deployed on a large-scale and have not yet fallen into the hands of established suppliers, it is possible to implement these solutions in a reasonable and fair manner to ensure that the interests of citizens are put first. Blockchain enables citizens to manage their own personal data, including data that is collected about them by third parties. For the first time, technology enables us to honour all of these principles in a practical and user-friendly manner, while achieving the sustainable protection of rights.

Compared to other countries, the Netherlands already has a well-functioning ecosystem in the area of blockchain in which public and private parties are collaborating. In this way, sectoral field labs such as Smart Industry and Agrofood are already busily experimenting and the city of Rotterdam and the Port of Rotterdam have taken the initiative to establish the field lab ‘Blockchain and Energy’. At Brightlands Smart Services Campus (BSSC) some 40 companies, start-ups, students and scientists are busy developing smart services. The Techruption field lab (TNO), also present on the campus, provides input for the further development of policy legislation as well as a test and development environment for private blockchain services. They work closely with local knowledge institutions such as Zuyd University of Applied Sciences and the universities of Maastricht, Aachen and Leuven.

This is only the start and many platforms and applications based on this technology have not been invented yet. Due to the introduction of Blockchain, the large, slow paper world can be brought up to speed with the rest of the world. This can be realised, for example, through international standardisation, which will make it possible to conduct business and transactions in a reliable and transparent manner in an unknown environment. Blockchain offers major opportunities to initiate this economic transformation.

USE CASE 3
ABN AMRO

Marjan van der Plas: “Blockchain technology, and technologies inspired by this, can take away a lot friction processes in which many parties are involved.”

“Last year we commenced on a broad field, with the main aim of acquiring knowledge about and a feeling for blockchain technology. We are doing this by means of exploratory studies, experiments and participation in national and international partnerships.

This year we have identified several use cases and are focusing on bringing these to the market. We are working both nationally and internationally in this experiment together with our external partners. We are seeing unique collaborations arise between chain partners, competitors, developers, government bodies, academia, start-ups, lawyers and numerous other parties. Together we are shaping a better and more efficient future. There is little point in working on blockchain alone: we can only realise that radical improvement by working together. That is why we are so pleased to be participating in the Dutch Blockchain Coalition.

“If you are wondering which processes within a bank could benefit from this technology, then a better question is actually: ‘Which process would not?’ Each process in which a value (asset) is registered or in which a transaction is performed will be strongly influenced by blockchain technology.“ Examples are the linking of identity to a blockchain, trade finance/supply chain management, multi-party data exchange, and storage, payment & settlement, etc. This subsequently translates into greater transparency and improved client experience, amongst other things.

All of this is still an early phase of development. A crucial factor will be whether or not the technology is scalable, in other words whether it is suitable for large numbers of participants and transactions, is robust and standardised. Many applications will not be explicitly visible to the consumer; blockchain is a technology that sits behind-the-scenes. We are not there yet. And the ecosystems will not change without collaboration. A joint movement is therefore needed and it is not a question of whether this will happen but when it will happen and how.”

Torch – Blockchain experiment in the commercial real estate sector

ABN AMRO is currently working on an experiment called Torch. This initiative is focusing on the commercial real estate sector. The online Torch platform is used to validate and exchange data between different parties such as real estate investors, appraisers, banks and De Nederlandse Bank. Blockchain technology automatically safeguards the data quality, so that all parties have direct access to the correct and current information. This means that DNB can perform audits in real-time. Appraisers have the (lease) information they need available immediately. And real estate investors can provide their data in a simple and transparent manner, which considerably speeds up the credit granting process and enables them to rapidly obtain certainty. This increases the transparency of the market, enables parties to have an immediate trust in real estate data and increases the ease and speed of business transactions. The following video explains Torch in just a few minutes.

DELIVER - Blockchain experiment in the logistics supply chain

In the DELIVER experiment we are investigating another promising application. DELIVER is a collaboration between the port of Rotterdam, TransFollow, Royal Flora Holland and ABN AMRO. This project is investigating whether besides transactions, mutual data exchange can also be used within a network of shipping companies and financing parties. As soon as the agreed upon performance has been delivered, DELIVER makes it possible for the client to request financing from the various financial parties who have joined the platform. This can be done without an external company receiving all of your details and data. The aim is to improve efficiency and trust in the exchange of information in order to realise a faster and more efficient supply chain.

An advantage of this approach is that the authenticity of the network data is validated in an efficient and transparent manner. The technology creates a clear audit trail, which in turn facilitates the trust placed in the network data.

“Blockchain offers the possibility for a shared truth (data and algorithms) between individuals and organisations. Initially this will lead to greater efficiency and significant cost savings. In the medium-term we also expect new applications and business models. ING is a leader in the discovery and codevelopment of new technologies. We contribute expertise and learn from other participants in the coalition.”

ING Bank – Peter Penning

“The key to developing genuinely relevant services and products that make an impact for our clients is a secure, user-friendly and reliable identity that is established on a blockchain. We expect that operational processes can eventually be accelerated in the interests of the client and at the same time be more user friendly. Blockchain might provide space for new solutions that cannot yet be realised.”

Nationale Nederlanden – Mariken Tannemaat

Block 3: If the blockchain is public, how is the privacy safeguarded?

As explained in Block 2, a blockchain itself does not need to contain the relevant files. In some cases just the hashcode is sufficient. The participants can use the code to check in retrospect that nothing has been changed in the underlying files and the chronological order in which these were added to the blockchain.

If the participants themselves would like certain data to be made public for the mutual network then a blockchain can contain that data, but it does not have to. There are also many ways to encode data and then use smart keys to ensure that only selected participants have access to this data.

A blockchain is therefore fundamentally different from a joint databank to which all participants in a network have access. If a blockchain is used to guarantee the integrity of the data then this can also be structured in such a way that each participant is free to decide with whom he/she may wish to share the entire dataset.

USE CASE 4
BRIGHTLANDS SMART SERVICES CAMPUS

Norbert Schmidt: “Often, patient data from hospital laboratories is still being sent by post to other hospitals and then manually entered in the computer. We will replace this expensive, error-sensitive and slow process with a reliable and efficient blockchain solution.”

“The Labchain project will commence in December 2017, connecting three hospital laboratories of the Maastricht University Medical Centre (MUMC) with each other. Labchain consists of a network of cabinets, each of which runs a full blockchain node: they encode and distribute patient information so that this can be requested from other hospitals in a properly secured and decentralised manner. Initially the system will be used to transfer patients' blood results between hospital laboratories. Unlike other care-related initiatives we are starting on a small scale. Thanks to the scalability of the software, other hospitals or medical laboratories will be able to join later without any problems.

Labchain

One of the Labchain developers is DDQ, a software company on the smart services campus Brightlands in Heerlen. DDQ has the knowledge and expertise needed to be able to realise a rapid implementation of the system with the MUMC. Various other companies from the smart services campus and the health campus are contributing to the development and rolling out of Labchain. This consolidation of expertise from various parts of Brightlands has made it possible to realise this unique product.

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The network of cabinets. Source: DDQ

Often, patient data from hospital laboratories is still being sent by post to other hospitals and then manually entered in the computer. We will replace this expensive, error-sensitive and slow process with a reliable and efficient blockchain solution.” This will not only save costs, but will also provide a basis for the properly secured distribution of patient data.

In addition, we will also use this case to carry out scientific research and answer several important legal questions associated with the legal ownership of the data and the protection of privacy. This case is therefore an ideal opportunity to involve several disciplines.

Safe solution

In general, blockchain is a comprehensive concept that concerns the transfer of value and decentralised registration. As far as we are concerned, blockchain - in combination with other decentralised technologies - can provide a secure and especially scalable solution that is available for everybody. The main problem is how we should deal with privacy-sensitive patient data, which must nevertheless be shared with several parties in the interests of the patient.

There are still some bottlenecks: blockchain knowledge is scarce and specific. We see a huge shortage of suitable developers who can actually realise the products. Also the trust of the end user is vitally important for the acceptance of the technology. Labchain will therefore be an autonomous, open, transparent process without a central party or control. We will use it to satisfy the future public requirement in which the patient will again gain control over his data.“

We are actively looking for relevant parties to participate in our pilot. So if you are interested please contact Norbert Schmidt (norbert@ddq.nl/+31 6 2119 9958)

“Blockchain can become the backbone for a better, faster, more secure, cheaper and more transparent realisation and enforcement of policy that originates from the Ministry of Infrastructure and the Environment. In complex networks, Blockchain will enable us to record and share information and transactions in a reliable manner.”
Ministry of Infrastructure and the Environment – Dirk van Barneveld

“Blockchain raises many interesting scientific questions. Whether it proves to be a gift, curse or hype; science must contribute its part to the developments. The scientific basis underpinning blockchain technology is still meagre. The coalition needs to pay sufficient attention to a strong scientific basis.”

NWO – Christiane Klöditz

USE CASE 5
TNO

Oskar van Deventer: "TNO has provided training courses for digital detectives since 2015. The training courses are continually adapted to the latest developments in blockchain."

Technology has no morals. It can be used for positive purposes but sometimes for evil intentions as well. Blockchain is no exception. Our motto is 'Innovation for life': TNO develops innovations for a better world. In this context, we foresee an enormous potential for blockchain technology, which also brings with a number of threats. TNO therefore works on both the bright side and dark side of this technology. Our dark web research intends to minimise criminal threat using technical and organisational solutions, without losing sight of the human factor.

Darkweb

As a knowledge organisation TNO acquires expertise by implementing open source software, developing its own applications, etc. In relation to the dark web we work closely with Interpol, Europol and other criminal investigation authorities.

The dark web is the part of the Internet that cannot be found via search engines and where many illegal activities take place. A well-known example is the infamous and now disbanded marketplace Silk Road. TNO has a fully functional copy of a dark web marketplace, including a TOR network, the browser for anonymous web surfing. All of this runs in a safe environment that is shut off from the Internet. Since 2015, TNO has given five-day dark web training courses in this environment to digital detectives. The training course is continuously adapted to the latest developments.

Bitcoin

One day of this training course is completely dedicated to the virtual currency Bitcoin. Bitcoin uses a blockchain to safeguard the integrity of the financial transactions. However, the anonymity and autonomy of the Bitcoin blockchain offers new opportunities for criminals, terrorists, money launderers and other illegal applications, because the Bitcoin blockchain is 'unstoppable': there is no government that can switch it off or reverse the transactions.

Bitcoin was the last step that criminals needed to complete their criminal business cases. The coin has existed since 2009 and since 2011 we have seen a wild growth in illegal marketplaces of drugs, weapons and medicines, but also in cybercrime services such as the recent ransomware WannaCry. We also work closely with criminal investigation authorities in this area to map and combat these developments. For example, we develop solutions to counteract the criminal use of Bitcoin.

Shared Ledger

However, TNO has a wide range of clients and jobs; in other projects we stimulate innovation on the basis of Blockchain. In concrete terms, TNO expects that companies and citizens will see a reduction in bureaucracy thanks to the introduction of blockchain technology. By making use of joint databases, in other words using blockchain as a shared ledger, it will no longer be necessary for every organisation to maintain its own data. That will yield a reduction in the cost of synchronising databases of individual organisations. It also enables individuals and consumers to obtain services against lower costs and at a faster pace as well.

“Blockchain has the potential to overturn the traditional banking model. Both how transactions are done as well as how trust is organised are disruptive.”


De Volksbank – Mirjam Verhoeven

“The collective sharing of knowledge in an open and trusted environment is a key factor for success. Just as important is the implementation of models and systematics that enable companies to create profitable business models. The coalition could fulfill a vital and supportive role in realizing these conditions.”
CGI - Hans Moonen

Block 4: What can blockchain be used for?

Blockchain technology is still very much under development and new applications are continuously being devised. It still remains to be seen which of these will become a reality.

Besides recording the transactions between participants, blockchain can also provide them with a verifiable digital identity. For financial transactions in particular, a blockchain will only want to grant access to participants with such a digital identity (unlike Bitcoin payments, where participants want to remain anonymous) in some cases.

Smart Contracts

Digital identity is a virtual safe with a digital passport and all other personal details are always up-to-date and available online. The citizen, however, retains control over this data. For example, to purchase alcohol he only needs to show that he is aged 18 years or over. Elsewhere this citizen might only need to demonstrate that he does not have a criminal record.

Blockchain can lead to radical innovations in the area of financial and trade transactions. These are so-called smart contracts, contracts that make automatic payments or deliveries under certain conditions. Such a contract can also include the condition that several participants must give permission for a transaction to occur.

Blockchainiacs

This innovation is expected to drastically reduce transaction costs in some economic sectors. Besides payments, this could apply to share transactions from a large listed company or bids at an online auction. However, the data traffic could also extend over decades; blockchain can also be used to guarantee the integrity of cadastral data or notarial acts.

In more futuristic applications, the blockchain participants are no longer people. Blockchainiacs, the real enthusiasts, speculate that blockchains will play a key role in the world of interconnected devices that will increasingly operate independently of people, such as self-driving taxis that operate independently in the market.

“Blockchain is a technology that assumes trust and makes it possible for parties that do not know each other to conduct business in the digital world without the need for an extra mediating party. The citizen determines who may have access to what information about him/her and when and for how long this can happen. Consequently, blockchain can contribute to increasing the trust in the rule of law, provide citizens with more control over his/her own data (including an identity) and improve the protection of the privacy of citizens.”

Ministry of Security and Justice – Anny Brouwers

“Blockchain provides decentralised trust. It therefore enables far-reaching automation of complex collaborations between parties and it allows this to take place with increasing autonomy. That will lead to efficiency and transparency and will open up unprecedented opportunities for new, disruptive business models. If Distributed Ledger technology (Blockchain) can realise its potential then by working together well in the Netherlands we can make a difference in the international field of digitisation.”

TNO – Henk-Jan Vink

USE CASE 6
Enexis Groep

Pieter Janssen (Innovation Manager at Enexis Groep): “As a network manager, we strive to ensure that the energy system of the future will also take care of people. After all energy is a right for everybody and does not depend on the revenue model. Blockchain is, in addition to artificial intelligence and autonomous assets, a potential building block that offers many opportunities in this future energy system.”

"Network managers ensure the Netherlands is provided with energy; a crucial part of our national infrastructure. Without energy, everything would come to a standstill and it would be dark and bleak. How do you as party and as part of this infrastructure, deal with the idea that in just twenty years' time the world could change in a way that seems to be ridiculous and dangerous now but will appear to be quite normal then? Enexis Groep wants to prepare for the future in the best way possible, whatever that future may look like.

Over the past twenty years we have seen that technology such as the Internet can bring about huge changes in the world as we know it. E-mail was the first big change. Shops and the entire entertainment industry relocated to the online environment. IT solutions relocated to the cloud. Social life relocated to the mobile phone and to social media such as Facebook and Whatsapp. Things we now consider to be normal but that twenty years ago still seemed to be ridiculous or even dangerous.

What will the next major changes be? What will be the building blocks of the future? Enexis Groep is investigating blockchain technology and artificial intelligence in combination with autonomous assets.

An exercise in strategic thinking

Enexis Groep expects that it will be possible for everybody to trade in energy. This requires new platforms and roles. In the long-term machines (such as autonomous/self-driving cars) will interact with other machines (such as solar panels) on a blockchain infrastructure. This could be the start of new economic models. After all, the electric car obtains solar energy directly from a solar panel and so the fuel for this car would be free of charge. What happens if no money is earned in such transactions?

In this exercise it is important to think about how this infrastructure will develop. IOTA - a variant of blockchain - appears to be highly promising in this regard. In this variant there is no extra work and consequently no energy is needed for the validation of and trust in the network. We are going to build an IOTA application together with the knowledge and innovation centre Elaad.NL. We would like to share this learning experience with as many people as possible.

Action-based learning

In May 2017, the team of Dr Carsten Stöcker from the German Innogy Innovation Hub launched the first working blockchain product: a solution that enables electric cars to charge up worldwide without the need for a contract (or a pass). Together with Innogy and ElaadNL, Enexis Groep will roll out this blockchain solution in the Netherlands on a pilot basis. It is expected that this will start in the first quarter of 2018. Everybody with a charging station and/or electric vehicle can register for this. Electricity can be purchased and sold in this pilot without transaction costs via a mobile app.

Only three modules in the Innogy blockchain application need to be adapted for the rollout of this blockchain product on the Dutch market. The speed with which functionality is added to the product and the international deployability of the application are simply astonishing. Under the MobilityWorks foundation, Innogy is continuing to build and is quickly changing this charging solution into a mobility platform. By adding just a few extra modules they will be able to offer parking services or keyless car-sharing solutions, for example. These add-ons will then be directly available in the Netherlands without the need to adapt the modules further. In addition, it is a good example of how use of the technology is fading the traditional boundaries between various industries.

Learning

On the one hand, Enexis Groep and ElaadNL are discovering a lot about the introduction of blockchain products and the speed at which these are being developed. On the other hand, they are also discovering that several drastic infrastructure changes will be needed for an operational blockchain as the market grows. The most important point learned up until now is that in a global blockchain solution a problem only needs to be solved once. Subsequently, the solution is available as a building block for everyone else worldwide. This has provided Enexis Groep with an initial idea about how Gartner's programmable economy could develop.

Building blocks

Following a discussion in the World Economic Forum, Enexis Groep is investigating to what extent a machine can own itself. In other words: the machine arranges all of its transactions on the blockchain and is not the property of a company or a private person but of itself. Enexis Groep is co-creating in this area with BigchainDB, the developer of this concept, and together with the faculties of Eindhoven University of Technology and Tilburg University (TILT & JADS) is examining what the legal consequences are. The question for the energy sector is how such machines will affect the energy supply. What are the possibilities? Raw energy is provided in excess by the sun. What will the machines that convert this raw energy into usable energy look like? How will they arrange their profit and loss calculations in the blockchain? How will the energy be distributed? Via the existing high-voltage and low-voltage network or by another means? What will be possible in twenty years' time? What are the advantages and disadvantages?

Blockchain and society

In the long term, and viewed within a societal context, blockchain in combination with other exponential technologies could make it possible to create an infrastructure of machines collaborating with machines. They would add value for people and take care of them so to speak. They would also not take any decisions on the basis of profit formulas but would take care of everybody.

As a network manager we are mainly concerned about the basic right to secure energy. From this perspective, the provision of energy is a basic right and not something that takes place with a profit motive. Network managers ensure that the Netherlands is provided with energy. Even if cables and pipelines in the ground are no longer the best way of transporting energy in the long term, we still have the task of safeguarding the rights to energy. Continuously investigating the possibilities allows us to ensure that we are ready for the future!

Interested in co-creating with us? Then please contact Jan-Peter Doomerik, senior Business Developer at Enexis.

“Access to the Dutch Blockchain Coalition give us the opportunity to acquire specific technological knowledge about Blockchain. At the same time we want to work together with the other partners from the coalition to help shape the changes needed in the legislation to make Blockchain possible, and we will subsequently be able to share this knowledge with our clients and other businesses.’’
CMS - Katja van Kranenburg-Hanspians

“Blockchain is a development that offers undeniable opportunities but that is also still shrouded in a certain amount of mysticism and inaccessibility. By working together with the partners in the coalition, Tilburg University wants to contribute to a better understanding of the technology and its worthwhile application in society.”
Tilburg University – Koen van Holten

Block 5: Which opportunities does blockchain offer the Netherlands?

Unlike in the initial days of the Internet, company directors, organisation strategists and policymakers should already be aware of the impact that blockchain can have on economic, technical, commercial and cultural opportunities. Although the technological power and quality of blockchain worldwide is still being tried and tested, early adopters among scientists and application experts are calling upon government and businesses to invest in the economic and societal possibilities of blockchain.

Within the Netherlands, the use of blockchain technology offers huge possibilities for improving services, the management of production processes, and cost savings, as well as reducing fraud sensitivity and diminishing cyber risks. As a knowledge economy, the Netherlands has a vested interest in the use of blockchain, especially in a number of vital economic sectors such as the chemical industry, ports, agrofood, the manufacturing industry, the financial sector, the energy sector and government. Dutch industry would like to hasten to realise the first practical applications, which, insofar as this is required, will be constructed in a technology-agnostic and interoperable manner.

In the Netherlands, there is a strong digital capability in academia and industry and there is a government that wants to realise digital transactions. Delft University of Technology, CWI and TNO have a lot of technological knowledge and there are many market parties who are interested in contributing to the development of blockchain applications.

The Netherlands has a strong international image with respect to the quality of its legal system, impartiality, security and reliability. A Dutch blockchain service in the area of logistics or taxation, for example, may be more quickly trusted worldwide than similar services from other countries. That provides opportunities for Dutch companies and government bodies to implement blockchain applications worldwide for specific themes. In this respect, the Netherlands can follow the example of Estonia, which is successfully building a portfolio of internationally deployable government services for citizens.

USE CASE 7
ICTU

Steven Gort and Bas Kaptijn: "Data management by the government is not yet sufficiently up to scratch; there are many data silos that are managed by third parties who often have their own agendas as well.”

"We have basically taught ourselves in the area of blockchain. We have acquired knowledge via contacts at universities and experts from the private sector as well as by networking at conferences about blockchain, such as Dutchchain and BECON. And for the rest it is mainly a question of doing things yourself. Our aim is to help realise blockchain applications in the entire trajectory from research and development in the lab, via field tests, to a full-service software delivery (FSSD); all with the aim of benefiting the service provided in the public sector.

Data management by the government is the result of people still thinking too much in terms of processes with registrations and administrations. This has resulted in a wide range of data silos that are managed by third parties who also have their own agendas. And on top of that, expensive digi-links need to be realised between these data silos. This encourages repeated copying of data with all the associated problems with respect to data quality and privacy. Furthermore, this considerably delays processes, especially when the new General Data Protection Regulation comes into effect.

Blockchain, in the broadest sense of the word, could be the catalyst that teaches the government to no longer think in separate processes but in terms of information networks. Therefore, instead of copying data between data silos, an information network develops as a utility service. This means that personal data – Personal Data Sources (PDS) – will remain with the owner and Self Sovereign Identity Management will be possible. The owner then decides which identity data will be made available to whom. This will require the government to once again examine its administrative law. Because how will we ‘regulate’ competent authority in an information network? By thinking through such issues, the government will be prepared for the new General Data Protection Regulation in a world that is becoming increasingly automated and has new forms of economic activity.

Blockchain technology is developing rapidly; we all need to anticipate this and have an open attitude towards major changes. As far as we are concerned, a condition is that the blockchain software is open source – so that everybody can inspect this and if necessary improve it – and that the governance of the software is distributed. In other words, there should not be a central authority that owns the copyright to the software and can independently make decisions about changes and updates. We think that we can realise the first applications of blockchain in the initial months of 2018.

If this is successful, we will be able to deliver a better 'basic hygiene' for the citizen with respect to his or her privacy-sensitive information. Such Personal Data Sources are based on the principle of the citizen having more control. We would like to further explore this information network of the future with the partners from the Dutch Blockchain Coalition and we will act as a link to pass as much of this knowledge as possible on to other government bodies.

“The Dutch Blockchain Coalition can serve as a coordination point for activities deployed around blockchain technology in the Netherlands and ensure that people do not reinvent the wheel independently of each other. The coalition can function as a platform that facilitates the aforementioned conditions for collaboration.”

Rabobank – Djuri Baars

Based on our decade of operational experience, Delft University of Technology has now created a roadmap to go beyond the current generation of Bitcoin and Ethereum technology. We are working on the key scientific breakthroughs required to realise the programmable economy. This ranges from self-sovereign identities to sub-second money transfers.”
Delft University of Technology – Johan Pouwelse

Relevant Starting Conditions
Interviews with some of our experts

Rhodia Maas, Director National Office for Identity Data

'Privacy must become the standard again'

What is the biggest bottleneck in the area of digital identity?

The digital and physical worlds are becoming increasingly intertwined. We all too easily divulge our private data even when it is not necessary. The government needs to actively protect vulnerable citizens from private parties. The government primarily actions this by organising legal frameworks: which data do parties such as the Dutch Tax and Customs Administration, the pharmacy or telephone provider need from citizens? This reduces the risk of identity fraud. Privacy must become the standard again.

Why is your National Office for Digital Identity participating in the Blockchain Coalition?

'Identity' is an essential component of many blockchain applications. When I do something online, how do I know the party on the other side is actually the person that he or she claims to be? And more generally: if blockchain technology becomes commonplace then what role will your online identity play? I do not think that blockchain will form a threat for privacy, but this is not certain yet. That is why the second line of action in our coalition is fully dedicated to the conditions required to ensure that blockchain is used in a secure and reliable manner.

Which technical innovation, partly under the influence of blockchain, is around the corner?

The developments are still in their infancy but if I zoom in on things then I can foresee that we will manage our identity via the mobile phone. For example, if you want to prove at the till that you are aged 18 or over, your phone will only have to provide a green tick. But in the healthcare situation, your phone can subsequently provide all of the necessary data about your medicine use. It must also be possible to 're-use' identity more so that you only have to fill something in once, after which you retain control over this information. Always having to send a 'copy of your passport' needs to become a thing of the past.

Will we still have a paper passport as a means of identification in ten years' time?

A digital passport on your mobile phone is definitely technically possible and in far less time than 10 years from now. However, the Netherlands cannot make such a decision on its own. Something like this needs to be introduced worldwide. Online voting will also be possible with such a digital passport. However, the desirability of that is a political question.

Could a compulsory online identity also limit the freedom of citizens? After all, being able to set up an anonymous Facebook page or Twitter account should surely still be possible?

We need to think carefully about where and when we may remain anonymous. That should also remain a choice in the future. But in that case, do not expect many bona fides parties to want to do business with you. After all, they will want a number of identity details from you so that a successful transaction process can be realised.

Hans Strikwerda, organisation consultant and Professor of Organisation and Change at the University of Amsterdam

'You won't get there by chasing the technology alone'


Is there a sufficient sense of urgency in the Netherlands regarding the wave of innovation that blockchain will unleash?

Just like the emergence of the Internet, blockchain represents a further acceleration in the changing balance of power in the market. Thanks to blockchain, the transaction costs in many sectors will be drastically reduced. That elicits questions about the business model employed by banks, solicitors and also lawyers. In this regard, the Zuid-As financial district of Amsterdam is still in a state of denial: 'we're safe and dry'. But in New York most bankruptcies are already processed by a robot. And I expect that blockchain will also take a lot of work away from financial consultants.

What do you think will be the first blockchain application that members of the public will notice?

I think that will be patients' medical files. In the ideal case, these will be safely located on the Internet and the patient will give permission each time as to who can access what data and who may change it. This is currently organised per hospital but ideally you want a 'chain of collaboration' to arise between all parties in the healthcare system. In Estonia, the online patient file was introduced back in March 2016.

A previous effort has been made in the Netherlands when the government tried to introduce the electronic patient file. However that met with resistance.

If you look at the mathematics behind the blockchain technology, and the cryptographic securing of data, it is clear that the electronic patient file can be realised in an entirely secure manner. However, the next question is whether you can make it clear to citizens why this is secure. Individual citizens will have to decide whether they trust this or not.

What is currently the biggest pitfall with respect to blockchain?

The pitfalls I see are not particularly in the blockchain technology itself but more in the legal and organisational aspects associated with making the technology productive. That goes much further than setting up a small project here and there. Information is still too often regarded as a cost item instead of a capital asset. Until we realise the value of information we will not be able to exploit the full potential of blockchain technology.

Which role do you think the Dutch Blockchain Coalition should assume? Surely the industry can take care of this itself?

In the Netherlands, the government should certainly play a role in the adoption of blockchain. You won't get there by chasing the technology alone. You can make a technology available but if you have no notion about what this means in terms of social innovation, the Netherlands will not benefit from it. In this regard, a severe change of mindset is needed. And the timescale in which the blockchain developments in China and the US are already taking place is short, less than a single cabinet period.

Katja van Kranenburg, partner at CMS

‘Many companies still hesitate: blockchain, is that something we should get involved in? As a lawyer's firm, we need to take our clients through this process.’

Has there already been a widespread embrace of blockchain technology by your clients?

It varies greatly. In some sectors, we see companies stating that they work with blockchain, for example the insurance sector. Yet we also see large companies respond along the lines of ‘this is far too complicated for us’. They are still hesitating: is blockchain something we need to get involved in? We think that we need to take our clients through this process by putting the subject on the agenda at the Boards of Directors level.

Which blockchain application will be the first to be widely used for legal questions?

We are currently studying the legal consequences of smart contracts. In short, these are agreements that arise via a digital platform as soon as the conditions that parties attach to these contracts have become effective. Of course, you can imagine a lot of legal ifs and buts in such situations. One such example is checking identity in the case of a real estate transaction. And who is liable if the identity of the other party is not known? A superb pilot for us, but also for one of the Dutch banks we work with, is a complete real estate transaction via blockchain. For a large pharmaceutical company and with their help, we are currently internally investigating whether their compliance processes can be recorded via blockchain. This and our current pilot with Delft University of Technology are interesting developments.

Is it a problem that non-specialists often find this technology difficult to understand?

Of course, it is better if you can explain blockchain in such a way that people understand what it is and what it can mean for their sector. And it is absolutely fine if people's initial response is that they do not have a clue. In such cases, we bring together different experts who can help explain it. To pass on the knowledge to our employees and accordingly to our clients, we have set up the CMS Legal Tech Academy within our provision of training courses. This is not a one-off workshop, but a training course in blockchain, smart contracts, artificial intelligence and related subjects. We do not expect all our lawyers, tax experts and solicitors to be able to read and understand source code afterwards, but some of them will be able to.

How does CMS benefit from participating in the Dutch Blockchain Coalition?

For us, participating in the blockchain coalition is a fantastic opportunity to really understand what blockchain is and to be involved in blockchain developments right from the start. At the same time, we can also play an active role within the coalition and contribute our legal knowledge. We are a law firm that positions itself as a frontrunner and early adopter. And we are investing serious time and effort in blockchain to live up to this reputation.

Claudia Zuiderwijk, President of the Executive Board, Dutch Chamber of Commerce

‘Large tech companies are clearly taking huge steps forwards but only six percent of SMEs are actively using blockchain’

Which innovations does the Dutch Chamber of Commerce see emerging due to blockchain technology?

Even before the emergence of blockchain, we saw that the demand to control one’s own data and certainly one’s own entrepreneurial identity was increasing. Blockchain has further stirred this demand and placed it in an actively experimenting community.

As the Dutch Chamber of Commerce, we are keeping abreast of developments by participating in fieldlabs such as the Dutch Blockchain Coalition, Techruption in Heerlen and the Dutch Blockchain Hackathon. In our Innovation Lab, we are also carrying out experiments in which the concepts are tested among entrepreneurs as soon as possible. Our active participation in these networks is not just due to our own interest as the Dutch Chamber of Commerce, but also due to our desire to support the ecosystem around blockchain. Strengthening entrepreneurship and economic innovation is one of our key tasks.

Do Dutch companies have enough sense of the urgency?

We see a divide: large tech companies are clearly taking huge steps forwards. However, our research among SMEs reveals that just 6 percent of these companies are active in this field. Not everybody has the time and expertise to actively follow trends in innovation. Many entrepreneurs only know about blockchain due to the Bitcoin.

As part of our duty to inform, we are also responding to this gap in knowledge: a book about blockchain written in everyday language has now been published, and one of its authors was an employee from our Innovation Lab.

Which blockchain innovation do you expect to be applied first?

Making predictions about the future is difficult, also for us. However, an obvious application according to the blockchain community will be digital identity for entrepreneurs. We are currently working with a large temping agency, which must check all its so employees to ensure that they are indeed entrepreneurs and that they possess the correct certificates. That is an awful lot of work. If you could realise the legal certainty of ‘knowing whom you are doing business with’ at the push of a button, then that would lead to enormous savings.

Do you also see disadvantages? Imagine that it would be compulsory for companies to join a blockchain.

The technology is complex and many potential users still find it difficult to understand. Making something like that compulsory is not appropriate. I stand behind a more positive approach for technology adoption: we will make this technology usable in a way that solves problems for entrepreneurs, makes processes easier and reduces the administrative burden. Or even better, in a way that expands the commercial opportunities for Dutch business. That way, we will develop a technology that will attract entrepreneurs.

Which role do you think the Dutch Blockchain Coalition should assume?

The Netherlands excels in collaboration between industry, government, and the research and education sectors. In the coalition, these disciplines have been brought together. This is useful for consolidating strengths, applying focus and, in particular, ensuring that government policy no longer trails behind but instead enables businesses to capitalise on opportunities.

What makes this phase so fantastic is that there is still plenty of room for development, but also a need for standardisation and direction. The Dutch Blockchain Coalition is currently working on acquiring that role. As the Dutch Chamber of Commerce, we make a warm plea to give smaller, innovative SMEs a role in all of this. After all, 94% of businesses have fewer than 10 employees.

Jeroen van den Hoven, Professor of Ethics and Technology at Delft University of Technology

'Now we need to make sure that politicians understand this as well'

You study the ethical aspects of new technology. Put simply, where does blockchain lie on the good to bad scale?

Blockchain is a possible building block. The question is what we will build with it. With blockchain you can set up an entire identity infrastructure in which everybody always and irreversibly leaves a digital trail. That goes far too far. This was also clear in the area of social media and big data: it started with a bit of dabbling and has since become very serious. Facebook, Google and their use of big data already exert a major influence on people’s thinking. We also need to need to give urgent and serious thought to blockchain and digital identity because all things being considered, this will not automatically lead to a good and just society. And the government should take a leading role in this debate.

Wouldn’t it be better to simply leave blockchain and other such new developments to the free market? After all, the government did not develop the Internet either.

Despite all of the fantastic stories from companies such as Apple, Google and Facebook about 'we are doing this for the people', their main driver is still the logic of the quarterly financial figures. The government has a responsibility to draw a distinction between good and bad and to develop a vision of what a good information society entails. That awareness is present in the Dutch Blockchain Coalition and among the senior civil servants who are involved in this, and they deserve our support. Now we need to make sure that politicians understand this as well."

What is the broader societal significance of technologies such as blockchain?

Aside from developments in some sub-areas such as the notary and financial sectors, it will also yield a new model for democracy. Secure mechanisms of voting online will enable a wide range of direct democratic forms. However, we need to think through this with people from different disciplines. Otherwise before you know it, such possibilities will be applied in a naive manner. For example, in recent referendums we have already seen that the appropriateness of the question being voted on has a clear influence on the outcome.

Sandra van Heukelom, lawyer and partner at Pels Rijcken & Droogleever Fortuijn

'Working in the blockchain requires creative solutions and a lot of courage!'

Which obstacles do you encounter as a lawyer in the area of blockchain?

As a lawyer's office we mainly look at how a blockchain relates to the legal requirements. Blockchain runs on a network of nodes. Together they record a so-called ‘unfalsifiable truth’. For a lawyer, however, that elicits challenging questions. In a legal sense, are nodes 'processors' of the data or are they 'responsible persons'? In this last case, they have a more substantial liability. And when do participants have the right to correct data in the blockchain, or the right to encrypt the data in such a way that other people can no longer access it? You need to be quite bold to come up with legally creative solutions for this.

In practice, how do you construct a blockchain that satisfies all the legal requirements?

It takes a lot of time to unravel the legal requirements for all aspects of blockchain. And to ensure clear communication between the legal and technical sides, we even had somebody at our office follow a course in computer programming. That enables us to think with the technical experts at a different level. And it was fantastic to sit down and talk with the blockchain developer. This was somebody who really listened, and that willingness to listen to each other was present on both sides. Each time that somebody thought 'that needs to be removed' with respect to privacy legislation, we had to go back to the developer because another new button had to be made.

Do you have an example of a blockchain that your office is involved in?

The National Health Care Institute now has an almost fully functional blockchain in the area of social support that is legally solid and sound. For many people who need help there is still a notepad on the kitchen table that care providers can make notes in. We will replace that with a blockchain to which both the professional care providers and the family have access. That will be in the form of an app that each care provider downloads on his or her smartphone, and through which the person will be guided in an intuitive manner. However, in such a way that the privacy satisfies the Health Insurance Act, the Social Support Act and other laws in that area.

"The digital and physical worlds are becoming increasingly intertwined. We all too easily divulge our private data even when it is not necessary. The government needs to actively protect vulnerable citizens from private parties."

National Office for Identity Data (RvIG) – Rhodia Maas

It provides an opportunity for the logistics sector in the Netherlands to take on this directive role and to consider how we can realise other business and revenue models with the help of blockchain’’
TKI Dinalog – Martijn Siebrand

USE CASE 8
Port of Rotterdam

Aljosja Beije: "Blockchain will have an enormous impact on the logistics and energy landscape in the coming decades. Given the strong position of Rotterdam in these sectors, we would like to play a leading role in this transition."

Blockchain is also a very promising technology in the logistics sector. In this context one of the better pitches is: ‘What Internet made possible for information, blockchain will do for value’. Blockchain enables us to exchange peer-to-peer value in a secure online environment. This value could be money, but also another value carrier, such as energy or a bill of lading. Furthermore, blockchain algorithms can be expanded in such a manner that they will automatically be able to realise transactions and complete contracts (the so-called smart contracts). Supply chains are organised in a strongly decentralised manner. However, existing management models within supply chain assume a centralised control. This limits their applicability to the supply chains of large multinationals. Blockchain holds the promise of improved efficiency and effectiveness in the other supply chains.

Impact

Besides better processes ('a faster horse') it also offers opportunities for new business models even though at present is still difficult to estimate what these will look like. Compare it with the Internet: back then nobody could have guessed that we would rent our homes to complete strangers or would shop via the Internet.

In brief: blockchain is expected to have an enormous impact on the logistics and energy landscape in the coming decades, especially on the transition from a centralised to a decentralised form of organisation. Given the strong position of Rotterdam in the sectors, we want to play a leading role in this transition."

Blocklab

To ensure a sustainable basis for the further development of blockchain, the city of Rotterdam and the Port of Rotterdam have taken the initiative to set up the field lab 'blockchain and energy' (Blocklab). Blocklab has arisen from the shared vision of the Port of Rotterdam and the city council's policy and concrete collaboration in two use cases that the Port of Rotterdam has started with BeSCOPE Solutions together with a number of other partners from the TKI Dinalog blockchain project. Our expertise in this area has been built up in everyday practice through two TKI Dinalog use cases, but we also work closely together with knowledge institutions such as Delft University of Technology, Erasmus University Rotterdam, HRO and the STC Group. In addition, we are holding discussions with suppliers of the well-known blockchain platforms in order to realise partnerships and we can draw upon the blockchain talent within the Rotterdam start-up/grown-up scene.

We estimate that by the end of 2017, both TKI Dinalog use cases will deliver minimal viable products. Other use cases (one in the area of logistics and two in the area energy) will be started this autumn with the aim of realising these during the initial months of 2018.

Actively seek collaboration

As we are still busy with collaborating on the first use cases, it is difficult to indicate what blockchain will eventually yield. The potential is there; processes that previously took days can now be dealt with in a matter of seconds. New business models are emerging that might well disrupt the current disrupters! But whether we will actually be able to realise all of this still remains to be seen. Many technological, societal, administrative and legal obstacles still need to be overcome.

However, we observe that with this new technology the emphasis is still far too much on doing everything yourself. The rest of the world is not idly waiting and in some cases people are already a lot further. Actively seek collaboration: by definition blockchain is not something you do alone. Furthermore, blockchain is still far too much a technology thing. Lawyers, accountants and managers are too idle on the sideline. Blockchain offers unprecedented possibilities but will not be able to apply these in a technological vacuum.

‘’For a technology such as blockchain the keyword is reliable innovation. By striking a balance between business opportunities, technical possibilities and legal and moral requirements, we can ensure that people, society and the economy can soon pluck the fruits of it.’’
ECP | Platform voor de InformatieSamenleving - Daniel Frijters

“The Brightlands Smart Services Campus is building an ecosystem of open innovation under the motto: from data to smart services to improve the quality of life. As a field lab within BC3 we offer the coalition possibilities to carry out concrete experiments. For us, this means that our ecosystem gains an extra dimension, enabling us to realise our objective in an even better manner. In the field lab we are working on large cross-sectoral blockchain challenges at a national level, with a focus on health, nutrition, sustainability and finance.”
Brightlands Smart Services Campus– Peter Verkoulen