Blockchain

Blockchain is a system in which a record of transactions made in bitcoin or another

cryptocurrency are maintained across several computers that are linked in a peer-to-peer
network. The blockchain is an undeniably ingenious invention – the brainchild of a person or
group of people known by the pseudonym.

The blockchain is distributed among a number of independent and isolated nodes in a

peer-to-peer network. Each node is a computer. In other words, the blockchain is anonymous
and decentralized - and that is part of its security. Each transaction or event is broadcast to
every node on the network, and each node on the network validates it through a challenge-
response system and rebroadcasts it. The result is that independent nodes in a network
containing the blockchain database can arrive at a "consensus" that the database entries are
correct.

Recent developments at the level of the European Union on blockchain

In the European Union held a conference about ″Vision of the future of financial
services thanks to blockchain″. The day began with a high-level overview of how blockchain
might transform financial services. It was pointed out that successful blockchain consortia in
the financial space tend to use the technology to digitise processes that could not be digitised
with the simple Internet – for example, trusted document exchange. This is an indication of
how blockchain could in future automate and to an extent replace the role of certain
intermediaries and do so in a more cost effective and safe way than is possible now.

Regulation was also touched on. It was pointed out that a lot that can be done in the
blockchain space with existing regulation, but that banks and clients often don’t have enough
information about what is possible. In the case of bitcoins, the most obvious legal issue is that
of anonymity.

ICT-54-2020: Blockchain for the Next Generation Internet (European Commission)

Specific Challenge: The Next Generation Internet initiative aims at developing a more
human-centric Internet supporting values of openness, decentralisation, inclusiveness and
protection of privacy and giving the control back to the end-users, in particular of their data. It
should provide more transparent and accessible services, more intelligence, greater
involvement and participation, leading towards an Internet that is a true engine of growth and
social progress.
 Blockchain and distributed ledger technologies (DLT) 49 have the potential to enable
more decentralised, trusted, user-centric digital services, and stimulate new business models
benefiting society and the economy as stressed by the European Parliament resolution on the
topic 50. These technologies will create opportunities to enhance services and processes in
both the public and private sectors, notably providing better control of data by citizens and
organisations, reducing fraud, improving recordkeeping, access, transparency and auditability,
within and across borders.

As a key component of the Next Generation Internet initiative, the specific challenge
is to foster research and innovation at technology, infrastructure and application levels to
position Europe at the forefront of the blockchain revolution. This topic contributes to the
European Commission strategy on blockchain. The first milestones of this strategy were the
launch of the European Blockchain Observatory and Forum 51, which aims to accelerate
blockchain innovation and the development of the blockchain ecosystem within the EU, and
the European Blockchain Partnership, signed by 26 Member States and Norway, to cooperate
in the establishment of a European Blockchain

Services Infrastructure.

The Research and Innovation Actions mentioned below are complemented by a

blockchain-commercial procurement action, which is presented under the “Other actions” part
of the Commission considers that proposals with an overall duration of 24 to 36 months and
requesting a contribution from the EU of EUR 8 million for sub-topic I); and EUR 6 million
for each sub-topic ii) and iii) would allow this specific challenge to be addressed
appropriately.

Nonetheless, this does not preclude submission and selection of proposals requesting
other durations or amounts. As the primary purpose of the action is to support and mobilise
internet innovators, a minimum of 70% of the total requested EU contribution should be
allocated to financial support to the third parties. For ensuring focused effort, third parties will
be funded through projects typically in the EUR 50 000 to 200 000 range per project, with
indicative duration of 12 months.

In line with Article 23 (7) of the Rules for Participation, the amounts referred to in
Article 204-205 of the Financial Regulation may be exceeded in order to achieve the objective
of the action up to a maximum funding per third party of EUR 500 000.
 Expected Impact: Proposals should provide appropriate metrics for the claimed
impacts.

• Shape a more human-centric evolution of the Internet.

• For sub-topic I): Reinforcing the European Blockchain ecosystem and excellence
in research.
• For sub-topic ii): Scalable blockchain based solutions for ensuring trustworthy
content and information exchange
• For sub-topic iii): Service models for community services building on collective
intelligence and novel approaches for connecting people and smart objects/agents
to stimulate use of collective intelligence Promoting interoperability and
strengthening the role of Europe in international standardisation.
• Create a European blockchain ecosystem integrating research and innovation
communities.

The law of blockchain

The terms blockchain law have mostly been on opposite sides of each other. With increased
global cryptocurrency regulations and measures, you will find it very hard to believe that
these two spaces can find a synergistic working relationship. However, there is a lot more to
the blockchain technology than just cryptocurrencies. So, before we look into the changes that
it can bring to the legal industry, let’s get some insight into the blockchain technology.

Areas where Blockchain can improve the Legal Industry:

1. Security

Legal firms are a prime target for hackers since they have so much sensitive data, they are
often the prime target for hackers. The reason why firms make such a great target is because
they are silos of extremely sensitive data. The blockchain’s architecture destroys the very
notion of silos. Many industries are adopting a blockchain consortium, wherein they are
putting their data in a private blockchain. Since the data becomes decentralized, it is
impossible for hackers to attack a centralized source.

2. Smart Contracts

Smart contracts are automated contracts. They are self-executing with specific instructions
written on its code which get executed when certain conditions are made. Smart contracts are
how things get done in the Ethereum ecosystem. When someone wants to get a particular task
done in Ethereum they initiate a smart contract with one or more people.

Developments on the topic of ‘’standardisation’’ of blockchain.

In April 2016, Australia proposed to the International Organization for Standardization

(ISO) to set up a technical committee (TC) on standardization of blockchain technology,
which was in the spotlight as the fundamental technology of cryptocurrency, as represented
by bitcoin. In September 2016, a TC on blockchain and electronic distributed ledger
technologies was established (TC 307), and international standardization efforts began in the
areas of blockchain and electronic distributed ledger systems and application, interoperability,
and data exchange between users. The second meeting was held in Tokyo in November 2017,
following the first meeting held in Sydney in April 2017.

DG Connect

Communications Networks, Content and Technology

The Directorate-General for Communications Networks, Content and Technology is

the Commission department responsible to develop a digital single market to generate smart,
sustainable and inclusive growth in Europe.

The new Artificial Intelligence and Blockchain Investment Fund was launched earlier
this year and will finance the development of highly innovative artificial intelligence and
blockchain companies as part of a wider move to create a dynamic EU-wide innovation
ecosystem. Run by the European Investment Fund, the first phase of the AI and blockchain
fund will make available €100 million in 2020 to support companies working in this sector.

More information about how to apply for funding will be available soon, and
companies attending the Slush event can learn more about the fund at the European
Commission’s workshop. Europe is home to a world-leading AI and blockchain research
community, with vibrant start-ups and a wide range of traditional industries looking to adopt
innovative processes and models based on these technologies. Investment levels in Europe
have traditionally lagged those in the US and Asia, however, and the aim of the fund is to
narrow this investment gap and support the development of innovation in this field. An
investment support programme will also be set up to complement the fund, leveraging further
financial support from EU Member States.
 The aim is to multiply investments at the national level by involving national
promotional banks, incentivising private sector investments, and making Europe more
attractive for start-ups to stay and grow in Europe. This is a particular issue for companies
based in central, eastern and south-eastern Europe. Recent research shows that due to
difficulties with access to finance, nearly half of start-ups in this region choose to leave, and
the European Commission, together with the European Investment Fund, has launched a pilot
investment programme which leverages EU resources under the InnovFin Equity programme.

The Digital Innovation and Scale-Up Initiative (DISC) provides finance for highly
innovative high-risk digital start-ups across this region of Europe and as well as carrying out
market consultations with investors and tech companies. Visitors to Slush can learn more
about the DISC initiative at another workshop run by the European Commission together with
Business Finland and VTT.

Eva Kaili – Member of the European Parliament (Blockchain)

Banks Can’t Stop Us from Using Blockchain

A Greek member of the parliament (MEP) of the European Union, Eva Kaili, declared
that central banks have too much control over people’s deposits, according to a post published
on Ripple’s blog on Feb. 8. According to the post, Kaili made the comments at the Ripple
Regionals event in London last week.

The MEP said that she realized that central banks had too much control over people's
funds after the debt crisis in Greece. During her talk - which was dedicated to how the EU
will regulate blockchain and cryptocurrency - Kaili also stated that she believes blockchain
technology will permeate all sectors of life: “[b]y its nature, blockchain technology doesn’t
recognize borders, [...] It’s unstoppable.” She also warned the audience that “[y]ou will be
disrupted if you don’t try to understand it. Instead you need to see the potential.” Speaking
about the benefits that blockchain-based systems could bring to cross-border payments —
such as faster processing and lower fees than legacy systems — Kaili declared: “If there are
benefits for European citizens, there are no banks that can stop us from using [blockchain].”

Kaili has reportedly been a key figure in advocating for funding for blockchain
development in Europe and clarity around regulations. As Cointelegraph previously reported,
in May 2018 the European Parliament Committee on Industry, Research and Energy passed a
resolution authored by Kaili that outlined the benefits of adopting blockchain and distributed
ledger technology. In December 2017, Kaili argued at a European Parliament policy dialogue
that cryptocurrencies will increase decentralization and make intermediaries less relevant.