Microsoft Eyes Role for Public Blockchains in Decentralized Identities
Software giant Microsoft has said it sees potential for public blockchains in supporting decentralized identities and will explore the possibilities within its Microsoft Authenticator app.
In a blog post on Feb. 12, Microsoft’s Identity Division doubled down on its belief that blockchain technology is the right solution to store, maintain, protect and distribute users’ identification information in a tamper-proof and decentralized environment.
Ankur Patel of Microsoft’s Identity Division stated in the post, “Some public blockchains (bitcoin, Ethereum, Litecoin, to name a select few) provide a solid foundation for rooting DIDs, recording DPKI operations, and anchoring attestations.”
That said, the company admitted that scaling is a key obstacle before a decentralized ID authentication can be available for millions of users simultaneously. As such the firm explained that it now eyes on developing additional layers to achieve the scaling goal.
“To overcome these technical barriers, we are collaborating on decentralized Layer 2 protocols that run atop these public blockchains to achieve global scale, while preserving the attributes of a world class DID system,” Patel wrote.
For now, the firm will “experiment” with decentralized identities by adding support for them into its Microsoft Authenticator app, which is already used by millions worldwide.
In what could be seen as a dig at Facebook, which is widely and controversially used across the internet for access to different services and sites, the post said:
“Rather than grant broad consent to countless apps and services, and have their identity data spread across numerous providers, individuals need a secure encrypted digital hub where they can store their identity data and easily control access to it.”
The announcement comes less than a month after Microsoft and blockchain alliance Hyperledger the United Nation’s ID2020 project, which aims to achieve a secure and verifiable digital identification system that can scale.
As reported, Microsoft donated $1 million to the ID2020 initiative during the World Economic Forum at Davos last month.
image via Shutterstock
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On Thursday, the smart contract protocol reached its millionth transaction. bitcoin Magazine received an update on the status of the project from Shawn Leary, the newly elected Counterparty community director.
Counterparty was launched in January 2014 with the creation of its native currency, XCP. Unlike typical ICOs (initial coin offerings) today that transfer funds to the founders, XCP was created by “burning” bitcoins, whereby bitcoins were sent to a special address (one for which no one owned the private key) that rendered them unspendable. Those who destroyed their bitcoins in this manner in return received an amount of XCP in proportion to their bitcoins lost.
This “proof of burn” process put all bitcoin users, including the founders, on an equal footing in terms of obtaining the native XCP token. According to Leary, the Counterparty team hopes that its unique founding sets the tone to attract new projects that won’t take advantage of users’ funds.
“We want to continue this legacy and hope it wards off scams and attracts genuine projects that use our protocol for what it was intended: decentralized markets,” said Leary.
Counterparty doesn’t have its own blockchain; rather, it exists entirely via the bitcoin blockchain. All actions taken on Counterparty are made through ordinary bitcoin transactions using XCP as the “fuel” that is spent. This means that Counterparty transactions are protected by the hashing power of bitcoin, so a double spend would require a 51 percent attack on the bitcoin blockchain itself.
Counterparty Project: More Than Games
Leary described an indie-game network that is “growing leaps and bounds around Counterparty.” This market is arguably where Counterparty has had its greatest impact. The first of these games to rise to prominence was , with its token launch in 2015.
Since then, many gaming projects have flourished on Counterparty. The currently has over 1,000 digital collectible trading cards registered via Counterparty for use in games such as SaruTobi Island and Rare Pepe Party. The augmented reality game has also successfully raised over $1,000,000 in bitcoins in a token sale on Counterparty of the in-game asset Databits, and even won investor Vinny Lingham’s support during an episode of . Augmentors is currently in beta and is planning for a launch in 2018.
But there is more to Counterparty than just games. Generally, Counterparty is helping anyone create digital assets with smart contract properties that are protected by the hashing power of the bitcoin blockchain.
For instance, Counterparty’s is aimed at rewarding those who provide computing power to Stanford’s project to aid in the study of diseases such as Alzheimer’s, Huntington’s, Parkinson’s and many cancers.
In collaboration with Storj, Counterparty developed Pico payments, which will be implemented to reduce the cost of microtransactions.
Probably their most widely used token, LTBCOIN, has been used by the LTB Network for a few years now. In fact, over 17 percent of all Counterparty transactions have been with LTBCOIN.
“Every protocol has its deficiencies and quirks,” Adam B. Levine, Editor-in-Chief of the Let’s Talk bitcoin! Show, said to bitcoin Magazine. “Counterparty is no different. What I like about it is that we’ve been building with it long enough that I understand those risks and challenges. We’ve already , like accepting dollar payments for tokens and giving token buyers the feeling of instant fulfillment when they’d otherwise be waiting for blockchain confirmations.”
The Scaling Debate: Preparing for What’s Next
The Counterparty team has not taken a definitive position on the various scaling proposals, but to run bitcoin Core. Leary told bitcoin Magazine that there are two routes Counterparty could take to account for a network fork. If Counterparty supports a hard fork in advance, they will “release a new version of Counterparty utilizing the new bitcoin client, and users must switch to this new bitcoin client as well as the updated Counterparty version before the specific bitcoin fork occurs.”
Alternatively, if a fork occurs that they did not account for ahead of time, they have the option to “freeze” Counterparty balances at a specific block height on the old chain and transition to a new chain at an indicated block height. In this case, “there would be some downtime, but the process would be announced well in advance with clear instructions provided for everyone.”
The team also emphasized that since Counterparty exists entirely through the bitcoin blockchain, there can be no such thing as a fork in Counterparty itself. Counterparty nodes do not need to coordinate with one another, since all nodes simply need to monitor the canonical bitcoin blockchain, whatever the Counterparty protocol defines that to be.
Continuing Improvements
Counterparty is still continually improved with development led by core maintainers Ruben de Vries and Devon Weller. There are currently two Counterparty Improvement Proposals (CIPs) outstanding, and . Both are aimed at reducing costs for transactions over the network. The team is also raising funds to upgrade .
Editor’s Note: The LTB Network is a property of BTC Media.
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