DLT and blockchain success: It’s all about timing
As ever, in the world of Distributed Ledger Technologies (DLT), timing is critical. Three years ago, GFT worked with Google and RBS on an Ethereum based payments project. Whilst the project was a great success, we saw that other technologies such as cloud and artificial intelligence were more developed and advancing rapidly, so we invested more time in those. Moving ahead to just 12 months ago, we saw that the situation had changed and that the market for DLT looked a lot more promising.
Nowadays the key challenge has moved on from demonstrating a way of making the platform handle the transactional volume, to one of how to get the use case into production. Also from a ‘cultural perspective’ the challenge is one of getting the organisation to understand the new paradigm created by a distributed ledger approach, including data sharing and the transformation of existing historic protocols and ways of working.
GFT Coin – our real-life use case
To be successful we realised we needed to ‘walk the walk’ by building and rolling out a blockchain use case, however, there are not many that could meet all of the criteria we required to ensure we could extract as much value and experience as possible. Therefore, we developed ‘GFT Coin’ as an in-house, but working solution, with the following attributes:
- Not a ‘mission critical’ system – as this was experimental
- Implemented in a single organisation – to avoid managing a consortium
- Uses one of our DLT partner platforms – to gain experience that would be useful to our clients
- Significant, but not excessive, transactional volumes – reflecting the current state of the market
- Designed to educate our organisation on paradigm shift that DLT can create
- An innovative solution that our 5,000 users in 11 countries could use on a voluntary basis
GFT Coin can be thought of as a ‘thank you card’ system, or a way of ‘liking’ and rewarding anything positive that someone in the user base does, with the reason for the reward being permanently written into the blockchain. Here is how it works: after registering, each employee gets three ‘coins’ a month in their account; if a colleague does something that a user thinks is great, then they can be given a coin, along with a reason that gets permanently recorded. Once spent (i.e. awarded), coins cannot be re-spent. In subsequent managerial reviews, employees are able to highlight unequivocally all of the good deeds that others have recognised in their performance.
After building the pilot in Ethereum, we subsequently took advantage of Quorum’s private transactions to implement the production system, which went live in April 2018.
What lessons did we learn?
Implementing GFT Coin was designed to help gain experience in developing blockchain technology, but also as a tool to educate our own users in aspects of using blockchain, including the following:
- Security: If users lose the private key for their wallet (and have not backed up the recovery key) then their individual coins are lost forever… and are really gone!
- Coin value: The coin transaction says as much about the giver as the receiver. The more carefully coins are awarded, the more value they have. As an example, a coin from the CEO probably counts for more than one from a peer.
- Recording everything: Users have learnt not to try and ‘game’ the system or lie; reasons for awarded coins are written on an immutable ledger and the results are there forever!
Even more interesting was the journey we went through and the lessons learned to get GFT Coin live, reflecting the real challenges that others will also face in implementing their own blockchain solutions.
- Fledgling platforms: As with most platforms in a new area, some of the software can be buggy, documentation incomplete and support sporadic.
- Data protection: As a European based global consulting firm we are of course highly aware of the implications of GDPR. Immutability and the ‘right to be forgotten’ for instance, are not necessarily compatible.
- Internal approvals: Getting the system approved by the individual privacy officers from each country in which the organisations operates is a tremendous challenge that should not be underestimated.
- System access: Although GFT Coin is an internal system, it had to be accessible via a ‘single sign-on’ and therefore required approval by the security committee, which also restricted the options for which cloud providers could be used.
- System updates: After rolling out version one, deploying subsequent updates utilising smart contracts whilst maintaining balances continues to be a challenge; specifically, how continuous deployment applies to DLT based systems.
With GFT Coin, in many ways, the coding of the smart contracts was the easy part. Complying with company policies in each of legal jurisdictions was much more complex. In addition, as with any new system, changing the organisational culture and processes to make use of the new system was actually the more difficult part. However, the successful outcome is that we now have a live DLT-based system with many transactions being processed every day.
Whilst the technology may now be more stable and easier to use, timing continues to be the critical issue in order to gain experience of distributed ledger technology. With patience and diligence, the benefits will be realised who persevere…as our experience shows…. It can be done!