Posted on

US Telecoms Giant AT&T Now Accepting Crypto Payments via BitPay

Telecom and media giant AT&T will now accept cryptocurrencies as a payment option through BitPay.

United States telecom and media giant AT&T now accepting cryptocurrency for paying phone bills online, according to an official press release on May 23. AT&T will process bills paid in cryptocurrency using crypto payments platform BitPay.

BitPay is a platform that converts cryptocurrencies to fiat and is used by over 20,000 businesses. AT&T is reportedly the first United States-based business in the wireless network industry to offer bill payments with BitPay.

Kevin McDorman, vice president of AT&T Communications Finance Business Operations, said, “We have customers who use cryptocurrency, and we are happy we can offer them a way to pay their bills with the method they prefer.”

Near the end of 2018, AT&T announced that it was working on a suite of blockchain solutions compatible with Microsoft Azure and the IBM Blockchain Platform. The stated aim of the suite is to provide “additional transparency and accountability to even the most complex supply chains” for institutional customers in fields such as manufacturing, retail, and healthcare.

AT&T also filed a patent application — which was published by the U.S. Patent and Trademark Office (USPTO) in December — for a blockchain-based “social media history map” that would allow a network such as AT&T to gather its subscribers’ social media “transaction” data. As per the application:

“The social media history map platforms described herein may take advantage of the immutable and permanent nature of blockchain records to store, and provide access to, data representing online transactions that occur on multiple social media applications.”

Posted on

Decentralized Identity: How Microsoft (and Others) Plan to Empower Users to Own and Control Personal Data

Microsoft continues its blockchain streak, empowering users to own personal data.

Microsoft, one of the world’s largest software makers by revenue, is currently on a blockchain streak. This time, Microsoft presented a vast blockchain-related plan: a decentralized identity (DID) network built atop of the bitcoin network, which can potentially empower users all over the internet to take control over their personal data and content.

Earlier in May 2019, the United States tech giant announced its brand new Azure Blockchain Service along with Azure Blockchain Development Kit for the Ethereum blockchain. It also teamed up with Starbucks to present the first use case for its technology — tracking coffee production, from farm all the way to paper cups.

Decentralized identity: from helping refugees to fighting data centralization

The initiative could be traced back to the summer of 2017, when Microsoft collaborated with Accenture and Avanade to create a blockchain-powered database system that would enable multiple parties to share access to the same data with an “extremely high level” of confidentiality and security.

The prototype — running on Microsoft Azure, the tech corporation’s cloud platform — was presented to support ID2020. The group is a nonprofit, public-private partnership that has set out to deal with identity related challenges that plague over 1.1 billion people around the world. In particular those people come from less privileged social backgrounds and so the lack of documents excludes them from participating in cultural, political, economic and social life.

The concept of digital identity has been widely discussed as the key to solving those issues. For instance, the United Nations has proposed to use it to aid refugees, who form a substantial part of the undocumented population. “We want every refugee to have a unique digital identity,” Filippo Grandi, the U.N.’s high commissioner for refugees, declared in October 2017. “This will enhance accountability and facilitate two-way communication between refugees and service providers. It will also help prevent and reduce statelessness.”

Around the same time, Microsoft presented its prototype aimed at narrowing the identity gap, while the tech juggernaut also became a founding member of the Decentralized Identity Foundation (DIF). The company subsequently continued its research on how a digital identity can be decentralized, and therefore benefit not only those who don’t have an officially recognized identity, but average internet users as well — meaning practically everyone.

Fast forward to February 2018 and Microsoft unveiled more details regarding its distributed ledger technology (DLT)-based plan. Specifically, the company reported that blockchain technology allows hosting decentralized IDs (DID) on top of the distributed ledgers, and hence can grant users more control over their personal data, as opposed to having it remotely processed by “countless apps and services.” Ankur Patel, principal program manager at Microsoft Identity Division, wrote at the time:

“With data breaches and identity theft becoming more sophisticated and frequent, users need a way to take ownership of their identity. After examining decentralized storage systems, consensus protocols, blockchains, and a variety of emerging standards we believe blockchain technology and protocols are well suited for enabling Decentralized IDs. […] We need a secure encrypted digital hub (ID Hubs) that can interact with user’s data while honoring user privacy and control.”

Now, Microsoft has presented a new and an even more concrete concept: a DID network built on top of the bitcoin blockchain. Titled the Identity Overlay Network (ION), the infrastructure has been reportedly developed in conjunction with other DIF members to accommodate “tens-of-thousands of operations per second.”

Essentially, ION lets users obtain control over their own data via the management of their Public Key Infrastructure (PKI). “Today, the most common digital identifiers we use are email addresses and usernames, provided to us by apps, services, and organizations,” Daniel Buchner, senior program manager at Microsoft Identity Division, explained:

“This puts identity providers in a place of control, between us and every digital interaction in our lives. Our goal is to create a decentralized identity ecosystem where millions of organizations, billions of people, and countless devices can securely interact over an interoperable system built on standards and open source components.”

In other words, having a DID allows users to control their own data and content — including login details and photos, which is not currently possible on most social media platforms that store such data on their private, centralized servers. Consequently, some platforms might be quite skeptical about the concept of a DID. According to a CoinDesk report, Facebook, which had allegedly been invited to partake in Microsoft’s DID project, has rejected the offer and “instead continued to follow its historic approach to user data,” which involves monetization, as per various press reports.

Moreover, DIDs are supposed to be immune to hacking and data leaks, says Charlie Smith, an analyst at asset management firm Blockforce Capital. “The risk associated with security breaches and hacks could be largely reduced when considering that public blockchains are largely decentralized,” he told Cointelegraph exclusively. “Currently, large platforms control vast amounts of personal data and are suspect to centralized attacks in which bad actors can gain access to sensitive information.” According to Smith, the bitcoin network, which has never been hacked (in the conventional sense, at least) could serve as an effective public blockchain to hold private data.

Moreover, the analyst continued, public blockchains can track users who wants to access their data while keeping it safe:

“Another benefit stems from the ability for public blockchains to act as ledgers. Public blockchains, like bitcoin and ethereum, hold extensive records of every transaction that has occurred on each respective network and at the same time, cannot be altered. However, a blockchain could easily be implemented to track who accesses personal information and when. In both scenarios, a transaction of some kind is taking place. The underlying technology doesn’t need to change, just the implementation.”

Bitcoin’s bane: Why scalability isn’t an issue for Microsoft — and other DID networks

Notably, the tech corporation had to overcome bitcoin’s infamous scalability issue in order to make the infrastructure ready for mass consumption.

In the blog post, Microsoft explained that “the most robust, decentralized, public blockchains” operate at just tens of transactions per second, which is “nowhere near the volume a world full of DIDs would demand.” Since the company aimed to inherit the attributes of decentralization — and hence use slower, but time-proven blockchains — it had to address the throughput issue. As a result, Microsoft’s new solution reportedly ensures that as many as “tens of thousands of operations” per second can be achieved. That echoes the concept of the Lightning Network, which adds another layer to the bitcoin blockchain and performs large amounts of transactions off-chain, thus unburdening the main network.

“Critics have always been quick to compare the transaction processing abilities of the Bitcoin network with that of Visa or Paypal,” Smith told Cointelegraph. “It wasn’t until the lightning network was established that those arguments became far less valid. The ION network will face very similar critiques and will need to back up its lofty expectations with results.”

Also, Microsoft plans to collaborate with open-source contributors so that ION can publicly launch on the bitcoin mainnet “in the coming months” — meanwhile, the code has already been published on GitHub for everyone to review.

The U.S. tech giant’s plan isn’t the only DID initiative out there. Microsoft’s allies from the DIF community seem to be working on their own decentralized data solutions as well.

“As part of DIF we regularly review and give feedback to each other’s DID methods, to make sure they are interoperable,” Pelle Braendgaard, the co-founder of ConsenSys’ Self Sovereign Identity (SSI) solution uPort commented exclusively to Cointelegraph. “At ConsenSys, we’ve developed multiple DID methods. Our primary method is known as Ethr-DID.”

According to Braendgaard, although both Ethr-DID and SideTree — the blockchain agnostic protocol used by Microsoft for ION — are “very scalable,” there are some differences between the two. Specifically, he argued, SideTree DIDs “have to be created by a centralized server, currently hosted by Microsoft.”

When asked whether ION can be considered a fully decentralized project, Smith argued that it is “debatable, but all the main benefits of a decentralized network are present.” Particularly, he specified that “two major components of the ION network make it highly decentralized”:

“The system is set up so that no person or entity can control users’ identifying information and the public key infrastructure is decentralized. This means that the private and public key pairings aren’t managed by one central authority, essentially giving each user secure access to their identifying data. Even though Microsoft has spearheaded this project, they have formed it in a way that allows individuals to remain in charge of their information.”

Further, according to Braendgaard, SideTree DIDs are only useable off-chain in traditional applications, while some other DIDs — including its own — are fully usable both on blockchains and Layer 2 protocols.

Other major companies pursuing DID solutions include global online payments firm PayPal, which has recently invested in Cambridge Blockchain startup. Also a DIF member, Cambridge Blockchain is reportedly leveraging blockchain to give users more control over their digital identities.

“We envision a future where users have a lot more direct control over their personal data, and we also believe in open, interoperable architectures,” the startup’s CEO, Matthew Commons, told Forbes.

There is also Telegram, an encrypted messenger that is widely popular among the crypto community. Last year, it released a personal identification authorization tool dubbed Telegram Passport, which reportedly encrypts user’s personal ID information and allows them to securely share their data with third parties like “finance organizations, ICOs, etc.”

As per the announcement, users’ ID data is currently stored on the Telegram cloud, but “in the future, all Telegram Passport data will move to a decentralized cloud.” Indeed, that could help the messenger to boost its data tool’s security — just a few days after Telegram Passport was announced, cryptographic software and services developer Virgil Security reported that it is vulnerable to brute force attacks.

Will Microsoft’s solution become the go-to one?

Microsoft’s DID-related plans seem to be highly ambitious. Specifically, the company aims to create an ecosystem where “billions of people and countless devices can securely interact over an interoperable system built on standards and open-source components.”

So, what are the chances of us seeing this come to be true?

“I can see how the ION network could potentially remove the control that apps and platforms have over digital identifiers and I believe that it could even become a worldwide-used phenomenon,” Blockforce’s Smith told Cointelegraph. “However, for that to happen, the technology powering the network would have to consistently prove that it can successfully scale.”

Once Microsoft manages to show that its network can handle thousands of transactions and operate on an industrial-scale, the data industry might be disrupted. This means that large social media platforms may have to adjust to the new rules and stop handling data in a centralized, opaque way — or else share the fate of Facebook and become infamous for regularly dealing with privacy concerns.

Cointelegraph has reached out to Microsoft for further comment, but the company said it was unable to accommodate the request at this time.

Posted on

Because Of Microsoft Alone, Bitcoin (BTC) At $8000 Is Significantly Under-priced

Microsoft Bitcoin

Microsoft’s fascination with blockchain technology is growing, and
days after announcing its Azure Blockchain Service, it is on to a new project.
The giant computing technology giant has announced that it is creating a decentralized
Identity network (DID) using the Bitcoin (BTC) blockchain. Known as the most
trustworthy blockchain in the space, the DID will be built as dictated by the
Decentralized Identity Foundation’s standards. 

Through the blockchain based DID, Microsoft is willing to let go of its software users login credentials. Its new system running on Bitcoin’s parent blockchain will give Microsoft’s users the control of their identity to use independent of any company as the user deems fit.

A Bitcoin (BTC)
Blockchain Based DID

Most blockchain enthusiasts have long awaited the creation of a
blockchain based digital identity. The innovation could eventually help all
internet users to own a portable credential wallet that can connect them
seamlessly to all digital platforms and apps. With such a DID in place, no one
company would need to hold into private user’s digital keys. They would utterly
be left in the control of the user.

Proponents of this technology believe that it would give privacy a
boon because users would no longer need to leave digital footsteps online
unless they wish to. The innovation would also reduce the chances of hacks and
leaks because there are no centralized pools of data to exploit.

Speaking of their innovation, the tech giant said:

We believe every
person needs a decentralized, digital identity they own and control, backed by
self-owned identifiers that enable secure, privacy-preserving interactions.
This self-owned identity must seamlessly integrate into their lives and put
them at the center of everything they do in the digital world

Microsoft Benefits More From Bitcoin (BTC)

Following this announcement, Bitcoin bulls rushed to praise
Microsoft’s interest in the Bitcoin blockchain and its potential significance
on Bitcoin (BTC) prices. One user tweeted, saying

At $8,000 the market is grossly under-pricing the significance of the Microsoft news. For a tech giant of this magnitude to announce they are using BITCOIN is probably the most significant announcements in this space to date. They have just endorsed BTC as a platform they trust.” 

Others, however, felt that Microsoft gained more from this move than Bitcoin tweeting back that

It is the stocks of Microsoft that should rise because they showed the world that Blockchain is Bitcoin. They use the most secure and decentralized protocol for their applications. That’s it. Bitcoin remains the same store of value with or without Microsoft…Microsoft has gained more value from Bitcoin than Bitcoin from Microsoft.”

The Microsoft – Bitcoin
(BTC) Contract Sends All the Right Signals

Ari Juels, a Cornell professor, however, says that Microsoft’s use
of the Bitcoin (BTC) blockchain sends all the right messages to the crypto
market, especially during this Bull Run. “A well-established player like Microsoft embracing an
anti-establishment technology is certainly a big deal
,” Juels said.
Bitcoin has been yearning for enhanced mainstream legitimacy and status, and
this endorsement by a trusted tech giant like Microsoft could improve its
portfolio’s value.

This contract it has gotten into with Microsoft could enhance its usage and even move its integration into legacy financial institutions that will embrace the Microsoft type of DID. This will, of course, increase the Bitcoin (BTC) overall value and stabilize it from the overwhelming volatility that plagues it since its inception.

The post Because Of Microsoft Alone, Bitcoin (BTC) At $8000 Is Significantly Under-priced appeared first on Ethereum World News.

Posted on

Microsoft Builds Decentralized Identity Network Atop Bitcoin Blockchain

Microsoft is developing a decentralized identity network because, “every person needs a decentralized, digital identity they own and control…”

Microsoft is building a decentralized identity (DID) network atop of the bitcoin blockchain, the tech giant announced on May 13.

In a blog post, the company said the infrastructure, known as the Identity Overlay Network (ION,) is based on an evolving set of open standards developed in conjunction with the Decentralized Identity Foundation.

Microsoft claims its approach addresses throughput issues that mean “the most robust, decentralized, public blockchains operate at just tens of transactions per second, nowhere near the volume a world full of DIDs would demand.” By contrast, the company says its approach means tens of thousands of operations can be achieved per second. In explaining the rationale behind ION, the blog post added:

“We believe every person needs a decentralized, digital identity they own and control, backed by self-owned identifiers that enable secure, privacy preserving interactions. This self-owned identity must seamlessly integrate into their lives and put them at the center of everything they do in the digital world.”

Daniel Buchner, a program manager for the Microsoft Identity team, said the goal of decentralized networks is to remove the control that apps, services and organizations have over digital identifiers such as email addresses and usernames.

Microsoft aims to create an ecosystem where “billions of people and countless devices can securely interact over an interoperable system built on standards and open-source components.”

Microsoft added that it plans to collaborate with open-source contributors so ION can publicly launch on the bitcoin mainnet in the coming months.

Technology that gives users greater control over their digital identities is gaining traction, with PayPal investing in such a startup last month.

ION is far from Microsoft’s first blockchain initiative. Earlier this month, it released a new Azure Blockchain Development Kit for the Ethereum blockchain, with Starbucks implementing this service to track coffee production.

Posted on

Ethereum Consortium Launches New Enterprise Tools With Input From Microsoft, Intel

The blockchain standards organization has released two new specifications aiming to enhance blockchain implementation for enterprises.

Member-driven blockchain standards organization the Enterprise Ethereum Alliance (EEA) has released two new specifications aiming to accelerate and enhance blockchain implementation for enterprises. The news was shared with Cointelegraph in two press releases on May 13.

The EEA, which counts over 500 members, describes itself as a “standards organization whose charter is to develop open, blockchain specifications that drive harmonization and interoperability.”

EEA members include global consulting firm Accenture, banks Santander and JPMorgan Chase, blockchain incubator ConsenSys, Big Four auditor EY, tech giants Intel, Microsoft and IBM and blockchain consortium R3.

One of today’s newly-released specifications is a set of standard application programming interfaces (APIs) — published as the EEA Off-Chain Trusted Compute Specification V1.0 — which support development work with programs for blockchain transactions that demand privacy, oracle services and compute-intensive workloads.

The off-chain solution is reportedly designed to enable enterprises to choose the most appropriate trusted compute technology for their use case — supporting methods such as Trusted Execution Environments, Zero-Knowledge Proofs and Trusted Multi-Party-Compute.

In a statement accompanying the solution’s release, EEA executive director Ron Resnick acknowledged in particular the input of EEA members such as Microsoft, Intel, Banco Santander and ConsenSys.

He noted that many enterprise blockchain use cases demand complex “privacy, security, throughput, and latency” solutions, and thus that:

“Temporarily moving some transactions off-chain for computation elsewhere, and then returning a summary to the main chain is a promising method for achieving such requirements.”

EEA’s parallel new release is the Enterprise Ethereum Client Specification V3, which reportedly simplifies and makes the Client’s permissions systems more flexible.

To develop the latest specification, the EEA Technical Standards Working Group tackled performance and interoperability issues based upon feedback from users and cross-industry EEA Special Interest Groups.

It also heeded the implementation experience and customer feedback for BlockApps’, Clearmatics’, ConsenSys’, and JPMorgan Quorum’s enterprise blockchain software.

As Cointelegraph reported in April, the EEA launched a blockchain-neutral Token Taxonomy Initiative which will seek to define tokens in non-technical and cross-industry terms in a bid to drive enterprise token adoption at scale.

Posted on

Bitcoins for Frappuccino: Will Starbucks’ Crypto Endeavours Pave the Way for Mainstream Adoption?

A deeper look into Starbucks’ crypto plans.

The United States coffeehouse chain Starbucks is one of the most mainstream companies to look into crypto, and its intentions have finally been confirmed this week: The company has teamed up with Microsoft to track its beans with a blockchain.

Moreover, reports say that the coffee giant might start accepting bitcoin (BTC) payments in its U.S. branches later this year. So, is the long-awaited mainstream adoption finally coming to the crypto market?

As many mainstream companies, Starbucks leans toward the “blockchain before bitcoin” approach

Starbucks’ relationship with crypto could be traced back to January 2018, when its executive chairman and former CEO Howard Schultz discussed the subject during the company’s Q1 2018 earnings call.

Schultz appeared skeptical about bitcoin at the time, saying that it won’t be “a currency today or in the future.” However, the chairman suggested that some other cryptocurrencies might succeed instead:

“I’m bringing this up because as we think about the future of our company and the future of consumer behavior, I personally believe that there is going to be a one or a few legitimate trusted digital currencies off of the blockchain technology.”

Those cryptocurrencies, Schultz added, would have to be legitimized by a brick-and-mortar environment.

In an interview with Fox Business that aired in March 2018, Schultz continued to discuss cryptocurrencies and their underlying technology. “I think blockchain technology is probably the rails in which an integrated app at Starbucks will be sitting on top of,” the executive chairman declared.

First crypto steps: Bakkt, BTC payments

In August 2018, the Seattle-headquartered coffee giant revealed itself as one of Bakkt’s key partners, alongside Microsoft and consultancy Boston Consulting Group. Bakkt is a digital assets platform created by Intercontinental Exchange (ICE), which is expected to launch later this year.

Notably, according to the original press release, Starbucks would not only be working with Bakkt to create its platform, but it would also be using it to accept crypto payments in its coffeehouses.

“As the flagship retailer, Starbucks will play a pivotal role in developing practical, trusted and regulated applications for consumers to convert their digital assets into US dollars for use at Starbucks,” said Maria Smith, vice president of partnerships and payments at Starbucks.

The news provoked bullish headlines akin to CNBC’s “New Starbucks partnership with Microsoft allows customers to pay for Frappuccinos with bitcoin.” However, the coffee retailer was quick to set the record straight. A Starbucks spokesperson told Vice on the same day the press release was published:

“It is important to clarify that we are not accepting digital assets at Starbucks. Rather the exchange will convert digital assets like Bitcoin into US dollars, which can be used at Starbucks. At the current time, we are announcing the launch of trading and conversion of Bitcoin. However, we will continue to talk with customers and regulators as the space evolves.”

“Customers will not be able to pay for Frappuccinos with bitcoin,” the spokesperson specifically stressed.

In March, new details about Starbucks’ partnership with Bakkt surfaced, confirming its intention to accept BTC-based payments once an equity deal between the two is struck.

Thus, according to The Block’s report citing anonymous sources, Starbucks will install Bakkt’s payment software in its branches, which will allow customers to pay with digital assets. Such payments will be instantly converted to fiat, however, so that the coffee giant does not have to deal with crypto, supposedly to simplify accounting. The option will be available exclusively for U.S. customers first, the article suggests.

That’s “no different” than other BTC merchant programs out there and hence is not a major case of retail adoption, says Michael Dowling, CEO and founder of FairX, a financial services company involved with banking and digital assets, and former chief technology officer at IBM’s blockchain arm. He told Cointelegraph:

“No one wants to hold BTC because of its USD volatility, but they love how ‘easy’ it is to receive value on BTC as long as it converts immediately to USD.”

Dowling suggested that it could be an attempt for Starbucks and Bakkt to bypass Visa and MasterCard’s interchange fees through the initiative, which can be helpful to merchants, but nonetheless should come with its own shortcomings:

“As a merchant, you’re just betting the exchange rate will be neutral or in your favor when it comes time to redeem. Oh yeah, and hopefully the redemption agent will always be able to provide USD liquidity.”

Eyal Shani, a blockchain researcher at Aykesubir, is also too skeptical to consider the initiative as a case of mainstream adoption, but admits that it could pave the way for further cases.

“Accepting bitcoin and immediately transferring it to fiat is simply enjoying the rate and exchange fees on Starbucks’ side,” he told Cointelegraph. “They can accept any currency together with the right fee to process it later. With that being said, any new real use case of bitcoin could serve as another step for larger adoption later down the road, if that happens.”

Charlie Smith, an analyst at asset management firm Blockforce Capital, however, thinks that Starbucks’ expected arrival into the field of BTC payments is a largely positive thing for the crypto market as it is. “While some may try to downplay this news because Starbucks will be instantly converting bitcoin payments into fiat currency, we do not believe it diminishes the significance of this news at all,” he wrote to Cointelegraph in an email, adding:

“We believe that Starbucks’ reported adoption of BTC as an accepted form of retail payment is a clear case of retail adoption. The fact that customers will be able to pay using bitcoin not only helps increase the overall usability of the currency but should also increase awareness and understanding of bitcoin and cryptocurrencies in general, given Starbucks’ market share. Additionally, if a retail corporation on the scale of Starbucks has determined that it is in their best interest to accept bitcoin as a form of payment, it is a clear signal that there is a significant consumer population ready to use cryptocurrency as a form of payment on a day-to-day basis.”

As for the immediate conversion of BTC, Smith said it should be similar to how a U.S. company converts payments made in euros into U.S. dollars: “There is a big difference between retail adoption of bitcoin or other cryptocurrencies and those same corporations being able or willing to deal with the exchange rate risks inherent in any multinational organization. Starbucks instantly converting bitcoin payments into fiat currency does not impact the retail use case for bitcoin any more so than a US company converting payments made in Euros into USD impacts the retail use case for Euros.”

The analyst summarized:

“Starbucks adoption is a leap forward for cryptocurrencies allowing people to utilize their bitcoin for more than just an investment, which should hopefully lead to further adoption.”

Bean-to-cup initiative: arming farmers with a blockchain

This week, tech news publication GeekWire reported that Starbucks will implement tech giant Microsoft’s recently announced Azure Blockchain Service to track coffee production.

First announced in 2018, the initiative is called “bean to cup.” Initially, Starbucks mentioned that it was considering using a “traceability technology” for its coffee-tracking system, without specifying that it necessarily would be a blockchain.  

Now, more details have been unveiled. The Azure-powered blockchain system will purportedly allow customers to track the production of their coffee and allegedly provide coffee farmers from Rwanda, Colombia and Costa Rica with more financial independence.

Additionally, Starbucks noted that it would make the pilot program open source to disseminate their findings. Other projects announced in collaboration with Microsoft include predictive drive-thru ordering and connecting Internet-of-Things (IoT)-enabled equipment at different cafe locations.

Microsoft’s Azure Blockchain Service was announced earlier in May. It is a blockchain-as-a-service (BaaS) platform that allows users to build blockchain applications on a preconfigured network. It currently supports Quorum, the Ethereum-based platform of JPMorgan Chase. The new Microsoft BaaS aims to streamline the use of consortium blockchain networks, from creation to modification.

Explaining why Starbucks could pick the Microsoft blockchain solution over other ones, Shani suggested that it could be a move to strengthen the partnership:

“Although no relevant information was published, we can safely assume that the choice of Microsoft’s blockchain services over other options were mainly affected by the current partnerships the firms hold rather than the technical differences of blockchain on Azure vs blockchain managed services on AWS, at this level of maturity of those services.”

Indeed, the two companies seem to have a close relationship. Starbucks CEO Kevin Johnson is a former Microsoft executive who ran the worldwide sales and the Windows divisions before joining the coffeehouse chain in 2015.

Smith, on the other hand, argues that Microsoft’s product is simply better for Starbucks than other options on the market. “Azure provides the ability to develop and implement blockchain technology into existing infrastructure in a faster and less resource intensive manner,” comparing to Quorum or other existing blockchain protocols, he told Cointelegraph.

“This allows Starbucks to focus on its own processes while outsourcing the responsibilities that may be best handled by a blockchain-savvy third party.”

Dowling of FairX suggested that Microsoft’s blockchain platform could seem more reputable to Starbucks than Quorum due to its roots:

“In enterprise IT, there’s an old saying ‘no one gets fired for buying IBM.’ Basically, Quorum is written and maintained by JPM, which is a bank and not a SW dev shop. So, if I’m an enterprise customer, I’m going to feel much more comfortable with a Microsoft branded version – along with their support structure – over the JPM offering, even though they might be the same piece of software. JPM knows that, and that’s why they partnered with Microsoft. That’s also the reason R3 and IBM did the same with Corda and Fabric.”

Why Starbucks would need a blockchain

However, Dowling is not sure why Starbucks would need a blockchain in the first place. He suggested that it could represent a potentially efficient way to track which farmer is sourcing the best beans as “voted” by customers, but could not think of any other real case use that could be achieved with blockchain technology specifically:

“To be honest, I find the entire program, as explained in the press, very confusing and I’m not sure what problem they are trying to solve. […] Why does it need to be decentralized?  Why does this program — of people voting for beans, I think — require the application of public/private keys and a distributed database?”

Indeed, accomplishing this goal could be done without using blockchain, agrees Smith of Blockforce Capital, “but incorporating an enterprise blockchain solution is more efficient than alternatives.” He went on:

“With this initiative, Starbucks is looking to greatly bolster the transparency of its supply chain. […] The proposed solution can be compared to how other blockchain networks, such as the bitcoin network, validate a large number of transactions without a centralized authority. The underlying technology is similar, its application is just different.”

There are other major cases of corporations successfully incorporating blockchain, the analyst adds, arguing that the technology should be the right fit for the “fair trade” concept that is popular within the coffee industry in particular:

“The IBM Food Trust program works with Walmart and other major food producers to track food production in order to help stem food-borne illnesses. Starbucks is tackling a similar problem but for a different reason. Whereas food safety isn’t the root cause, Starbucks wants to provide customers the opportunity to track where the coffee they consume is being produced. Any person that is even a casual coffee consumer has heard the term ‘fair trade’ used quite frequently. The concept of fair trade has gained significant attention over the past several years in a number of industries, with coffee being one of, if not the largest industry to focus on fair trade. Through the ‘bean-to-cup’ initiative’s use of blockchain, customers will be able to personally verify where their coffee is coming from and pinpoint specific producers that are producing coffee sustainably and fairly, as well as those that are creating exceptional coffee. A customer drinking Starbucks today has little to no idea who is producing the coffee they are consuming, and can only rely on a sticker to ‘verify’ that coffee is fair trade. In essence, Starbucks is looking for a way to provide greater accountability and that can be accomplished with an enterprise blockchain solution.”

Similarly, Shani believes that the “bean-to-cup” initiative is part of the general “food trust” trend empowered by blockchain:

“The use of blockchain in the food supply chain is a very interesting one for several reasons. If you’re a building constructor, you’re very likely to buy your hammers all at one place. Firms like Starbucks source their coffee beans from hundreds of thousands of small farmers to meet demand. Some of those farmers won’t even be registered business in their home countries. It is impossible to maintain trust when dealing with such large scale long-branched supply chain. Instead of making one entity to hold all the data and attest it’s correct, a smarter idea would be to create a collaborative blockchain based database where every party is liable to their part.”

However, the blockchain researcher added that even a centralized database could create new opportunities within the coffee industry, considering “the state in which the legacy systems are today.” Shani also stressed that neither the exact architecture of the solution nor the trust model have been disclosed by Startbucks at this point.

The potential financial opportunities for coffee farmers mentioned in the press release and the GeekTimes report are also somewhat unclear.

“The only thing I can think of here is there’s a payment rail component that reduces the cost of cross-border transactions,” Dowling told Cointelegraph. “Though they make no mention of that. Or there’s some kind of ‘bean-coin’ the farmers get, and they redeem that for fiat? If that’s the case, why blockchain?”

Given that the main benefit of the “bean-to-cup” initiative is that it can provide farmers increased transparency and a large amount of new data, Smith suggested, it could allow them to build their unique brands “outside the overall Starbucks name.” He continued:

“Currently, when you buy coffee from Starbucks the only information available is the type of coffee and the country where it was grown. By utilizing blockchain, Starbucks will be able to provide its customers with endless amounts of new information, such as when the coffee was harvested, when it was shipped, what farm it came from, and potentially even the farming techniques used as that farm.

“This will provide customers with greater power to support certain farmers, whether because of sustainability or simply because that farmer makes the best tasting coffee. This, in turn, should allow the more than 380,000 farms to differentiate themselves and build a unique brand outside of the overall Starbucks name. From the farmers’ standpoint, this new service should provide valuable data on consumer preferences and taste profiles, which will allow farmers to form data-driven conclusions and help them make more profitable decisions.”

Cointelegraph has reached out to Starbucks to clarify why it would need a blockchain and how exactly it could benefit the coffee farmers, among other things, but has not heard back as of press time.

Posted on

JPMorgan Overhauls Quroum’s Privacy Architecture With Help From Microsoft

United States megabank JPMorgan Chase has reportedly rehauled the privacy layer of its blockchain platform Quorum.

JPMorgan Chase (JPM) — the United States’ largest bank with over $2.62 trillion in assets — has reportedly rehauled the infrastructure of its blockchain platform Quorum with the help of Microsoft. The development was reported by crypto media outlet Coindesk on May 9.

As reported, Quorum is JPM’s private blockchain platform built on the Ethereum protocol. According to JPM head of Quorum and crypto-assets strategy Oli Harris, developers have been working to innovate Quorum’s privacy architecture by replacing its former Haskell-based privacy engine Constellation with the Java-based “Tessera” privacy transaction manager.

Harris is cited as outlining that the innovation is intended to make the Quorum platform easier to implement by a broader spectrum of firms, noting that:

“It’s open source software, available on Github and maintained by JPMorgan on behalf of everyone using Quorum. The more users of Quorum, the better it is for everyone, because we can help with standardization and creating even more robust tech suite.”

Microsoft and JPMorgan’s engineers are reportedly further working to streamline node deployment on the platform and reducing its complexity, as well as developing options such as multiple consensus mechanisms and the provision of a modular menu bar of privacy solutions. Harris reportedly explained that the firms’ efforts are being undertaken so that:

“Companies like JPMorgan can actually focus on the business applications and unlocking value from the technology, whereas Quorum powered by Microsoft will be dealing with a lot of the heavy lifting.”

Harris further underscored that Quorum is being designed to be multi-cloud, notwithstanding the bank’s extensive cooperation with Microsoft Azure cloud.

As recently reported, Quorum became the first platform that can be managed using Microsoft’s just-released new blockchain-as-a-service (BaaS) platform, Azure Blockchain Service.

Microsoft has since then this week continued to roll out further tools for its Baas platform, including the Azure Blockchain Development Kit for the Ethereum blockchain.

As JPMorgan and Microsoft have been working to innovate the technical specifications of Quorum, the banking giant has largely been in the industry limelight for its recently unveiled  blockchain-powered stablecoin, dubbed JPMCoin.

Posted on

Over 50 Banks Simulate Letter of Credit Transactions on R3’s Blockchain in 27 Countries

Over 50 banks participated in the simulation of letter of credit transactions on R3’s blockchain platform in 27 countries on six continents.

Over 50 banks participated in the simulation of letter of credit transactions on R3’s blockchain platform in 27 countries on six continents. The company announced the development in a press release published on May 8.

Per the release, 96% of the participants said that the system — dubbed Voltron — will accelerate and reduce the cost of their letters of credits procedure. Furthermore, 86% of them reportedly believe the inefficiencies of the traditional system are becoming intolerable.

The company claims that Voltron cuts the execution time of the procedure from 5-10 days to under 24 hours. R3 states that, as a result of the adoption of the new system, 61% said that they are likely to move trade flows to “open account,” an option which is reportedly riskier for exporters.

The participants of the six-weeks-long trial reportedly include CIB, MUFG, National Bank of Egypt, RBI, Standard Bank and Societe Generale. The system was delivered through a partnership of Bain, CryptoBLK and R3 on Microsoft’s Azure cloud platform. Voltron is designed to be compatible with both Corda and Corda Enterprise, aiming to replace the traditional finance links and networks with a shared ledger.

As Cointelegraph reported in March, United Kingdom-based banking giant HSBC is seeking banking partners in South Korea to deploy Voltron in the country.

Kuala Lumpur-based Bursa Malaysia, the country’s stock exchange, is also working on a blockchain-enabled security borrowing and lending proof-of-concept in partnership with Hong Kong-based Forms Syntron Information, the stock exchange’s technology partner.