The power of artificial intelligence (AI) has taken the tech industry by storm in recent months. Years of computer science modeling through machine learning and deep learning have provided the traction for what has become a wide range of AI use cases. Its capabilities are now evident in everyday use, whether giving instructions to a smart assistant like Siri or sitting behind the wheel of a self-driving car. And with supervised and reinforcement learning, conversant AI systems can handle an articulate back-and-forth discussion with a human. The trajectory of AI’s potential impact on our lives seems long and steep.

Blockchain technology provides a unique opportunity for big data to operate like never before. Previously, a subset of private data would have to be gathered over time until it became rich enough for its artificial intelligence (AI) to run insights.

Coinmarketcap recently published a very informative piece about the merging of blockchain and AI. Without getting too much into why AI and blockchain make so much sense together, the article outlines a dozen or so AI projects on blockchain, from generative NFTs to health and wellness applications. But why? Why does the overlap of blockchain and AI present so much promise in the long term? Let’s first discuss the basics of this powerful combination.

Through behavior pattern observations and learning, traditional AI systems analyze all sorts of operations, particularly for financial institutions and financial regulators. These tasks can range from fraud detection, to audits, to live market research, making way for predictive analytics.

Data to an AI is like a knife sharpener to a blade. The more data, the more accurate and precise the results are — similar to the more you sharpen a knife, the easier it is to cut. The difference is AI will have an infinitely sharpening blade that makes it more accurate over time.

As data on blockchain is much more accessible, sharpening this blade becomes a lot easier. On-chain applications generate more user data that AI systems can analyze almost instantaneously. Blockchain can not only extract rich data from smart contracts, it can also pull data from the relationship between one contract and another, or between contracts and users. This allows for data insight on behavioral patterns like we’ve never seen before.

For those worried about privacy, this will not be private identifying data. The data being analyzed will be similar to public market data provided by exchange and regulator agencies for transparency, the way public companies have reporting standards. The big difference is the on-chain aggregate data being reported will be public and automatically produced instantaneously.

When you couple AI with blockchain technology, there is just so much more data readily available. Blockchain and AI would allow financial regulators to conduct live audits and fraud detection. Decentralized applications on a given blockchain network can maintain a close relationship with AI to root out bot users, analyze user activity, generate complex user stats, and conduct in-depth evaluations of third party application activity.

Data is power. As more applications come onto blockchain networks, their activity and growth can be monitored in new, unprecedented ways. It can be analyzed in real time for insights into new companies, allowing for creation of better growth models or increased profitability.

Real time monitoring of an economy, afforded uniquely by blockchain and AI, can provide insight into macroeconomic systems that is simply not possible through other means. Economic growth in an entire industry could be tracked live, allowing economists and lawmakers to craft relevent policy or detect widespread impropriety. Government subsidies could be doled out while AI monitors for fraudulent activity.

There are over 100 projects on blockchain — or in the pipeline — that incorporate AI. Some of these use — or plan to use — AI as a predictor much like traditional AI platforms. These capabilities range from spot stock trading and hedge funds, to disease prevention and diagnosis. Others are simply expanding AI capabilities in a very general sense, and bringing them on blockchain. But down the line, as more data goes on chain, we will see even more exciting, real-time, extremely practical use cases like what I outlined above. These AI capabilities will only be possible on blockchain networks.

When coupled with the distributed ledger of a blockchain network, the possibilities of AI are nearly limitless. And as no one party has a monopoly on subsets of data, not only will the intelligence be richer, but the AI capacities themselves can grow by leaps and bounds through open source innovation. It’s almost impossible to predict exactly what is in the promising future of blockchain plus AI, but I can’t wait to see what it brings.

The Powerful Relationship between Blockchain and AI was originally published in XDC Foundation Communications on Medium, where people are continuing the conversation by highlighting and responding to this story.

Most people recognize how the internet and associated technologies have revolutionized everyday human life. Through online retailers, social media and increased access to information, the internet drives our modern economy.

Smartphones, applications, email, social media, audio and video streaming, online banking, podcasts, cloud storage, and online gaming have formed a bedrock for increased consumerism and thriving digital economies.

These digital economies have been undergoing perpetual transformation ever since the first programming languages. After all, in the early days of the internet, huge warehouses hosted giant computers that couldn’t compete with the average home computer today. Now we have cloud-based databases and handheld devices sharing data with millions of users, on demand.

The above innovations make the once seemingly impossible, possible.

Despite these advancements,, we often fail to recognize how revisions to web-based solutions perpetuate the growth of the global economy.

Subtle technological progressions have allowed entire industries and platforms to emerge under our noses. Smart phones, for example, have created an entire class of business — mobile apps — while the creation of HTML/CSS created an entire industry of websites. Less visible technologies like cloud computing through Amazon Web Services (AWS) allow for applications to have a consolidated global infrastructure that can be managed via software, instead of hardware. Without these subtle revisions to technology, applications like Netflix, AirBnb, Uber and other new revolutionary startups would have to build and host their own infrastructure world wide — a feat that would slow the growth of their businesses and reduce impact on consumers.

We can see a similar arc with blockchain technology in the modern age.

For many, the predominant application of blockchain technology is merely through highly visible cryptocurrencies. Today, people recognize the ability to move abstract value between two or more parties by sending tokens on a blockchain network.

However, the impact of this technology reaches far-beyond this simple application. How exactly this next generation of the internet, known as Web3, may affect our day-to-day lives is, in part, a mystery. But we can identify areas of potential impact.

One such example of potential impact exists in the form of twenty-four hour financial services. Supported by blockchain technology, twenty-four hour financial services will enable instant confirmation of financial transactions–no matter the day or the time–enabling businesses to deposit checks, make transfers from one financial institution to another, and clear refunds outside of the traditional work week. As blockchains continue to decentralize the financial sector, outages will become increasingly less likely, and individuals will no longer have to rely on a single party to support their online financial activity.

Case in point: In late 2021, Meta shut down for 6 hours, and lesser known services, forums, blogs, and other platforms have disruptions regularly. We accept these outages as part of the digital economic landscape, but it’s clear there is opportunity for improved reliability. Blockchain will help fix this, as no one person, government, or localized natural disaster can take down a decentralized blockchain network.

We will see additional improvements through decentralized applications (dApps). Currently, our mobile applications connect to large corporate servers to run their systems’ backend logic. This is both costly and relatively unreliable as there are more opportunities for failure between systems. And this cost raises the barrier to entry for creating internet applications that allow

users to interact with each other, further stifling creative development and limiting our choices as users.

Blockchain networks will allow for server-less operation of dApps. In practice, a blockchain network will function as an open-source server that anyone can use — the sort of groundbreaking development that we haven’t seen since the advent of the internet. Even the rare no-ad, free-to-use services of the past were hosted by large private servers that incurred serious costs. If the owner decided to shut down these services, they became defunct immediately, and users usually lost all of their data. With blockchain, dApp operators’ costs will be reduced, and users will have better assurances that they own their data.

On a dApp using a blockchain network, users will pay execution fees, also known as gas fees, based on their activity. These fees, which can be paid in the network’s native token, will undoubtedly be less costly than those set by Web2 technologies. In some cases, Web2 charges users through high-priced subscription models, but other times it is through bombardment of advertisements. Regardless, there is always a fee the user is paying. Using blockchain networks, there can be more predictability about the costs to users and more efficient ways of managing that cost.

Another Web3 advantage will come in the form of information transparency. While screenshots and financial statements can be manipulated, a blockchain’s public ledger cannot. Blockchain’s resistance to tampering also has data security advantages compared to traditional servers. It’s much harder for malicious actors to pretend they are someone else and gain access to on-chain private data.

Summary

Blockchain has the promise to make the internet more open-source and reliable than we’ve ever seen. It may usher in a new legion of startups by lowering the barriers — and the risks — for creators. Users will have more control of their own data, and financial transactions will be verified much more quickly and reliably. In almost all areas of digital life, Web3 will provide greater efficiency, security, and choice for users.

READ: Why You Shouldn’t Be Afraid of Digitization by Quincy Jones & Billy Sebell

Web3 and the Modern Economy Covered by Quincy Jones of XDC was originally published in XDC Foundation Communications on Medium, where people are continuing the conversation by highlighting and responding to this story.

Propelled by considerable use and adoption in 2022, XDC Network awaits a fruitful new year

Over the past year, the XDC Network has observed a significant spectrum of innovation and adoption of its blockchain technology, ushering in a new era for the XDC Ecosystem and its dedicated community. Throughout 2022, the network became host to a number of key applications and supported the incredible achievements of many diverse network participants — a fitting encore to an impressive 2021. Growth of an XDC community that is larger and more vocal than ever, major technical integrations across the crypto industry, decentralized projects with real-world implications, and the launch of regulated security tokens and stablecoins all underscored the network’s usage across a variety of spaces and demographics this year.

The XDC Network is application/use case agnostic and does not target any specific market — but the teams that build on it do. In 2022, the network improved its position as a leading blockchain in trade finance by supporting a number of finance-related use cases and received unprecedented recognition. In March, the XDC Network became the first blockchain member of the Blockchain Supply Chain Association. In April, the network was one of only a handful of public blockchains mentioned in a World Trade Organization feature entitled, “The Promise of TradeTech: Policy approaches to harness trade digitization.”

In July, the TRADA Token was launched on the XDC Network. TRADA is the first fully regulated, trade finance-backed fungible security token, allowing both institutional and retail investors to participate in a previously hard-to-access asset class. Following the release of TRADA, the XDC Network was showcased at the ITFA Conference in Porto, Portugal.

Central to the growth of a blockchain network is its community, and the XDC community grew rapidly in 2022. This summer, XDC hosted its first hackathon. Not long after, the XDC community approved the XDC Network Improvement Proposal (XIP) process, which is focused on decentralized decision-making around the core protocol. In the months since that approval, a growing number of contributions have been published in Github as community participation continues to gain steam.

The year 2022 kicked off several exciting projects. In September, Securrency, a leading blockchain-based financial markets infrastructure and products company, announced that it will deploy its Digital Asset Composer on the XDC Network. A month later, Fluent and Impel announced that they will bring the regulation-driven US+ stablecoin to the network. STASIS did the same with EURS, the largest euro stablecoin.

As an Ethereum-compatible blockchain, dApps on the XDC Network are powered by developer-friendly smart contracts. There are now nearly 12,000 smart contracts deployed on the network — a 525% increase from 2021.

And we can’t forget the new hires at XinFin, creators of the XDC Network. Sunil Senapati was brought on as XinFin’s chief operating officer for trade and payments. Sunil boasts a long history in the trade finance industry, and most recently worked as head of business development at MonetaGo. Sunil has noted how XDC teams are working closely with the governments of UK and Singapore to support the adoption of the MLETR initiative.​ XinFin also hired Doug Brooks as a senior advisor of special projects and tokenization. Doug has over a decade of experience consulting and building strategies in the cash and payments space, working with banks, governments, and other parties.

Then there were the integrations, which are key to any blockchain infrastructure. Notably, XDC collaborated with Global ID and integrated with Fireblocks, Overledger, and Uphold in 2022 — just to name a few.

Other items of note in 2022:

• Dubai Multi Commodities Center, the largest free-trade zone in the United Arab Emirates, partnered with ComTech Gold to tokenize gold tokens (CGO) on the XDC Network, enabling blockchain-based trading of physical gold bars.
• XDC Network advisor, André Casterman, provided thought leadership around blockchain regulation. Notably, he was interviewed by Blockdata for their widely-published article focused on regulations boosting global trade. At ITFA Porto 2022, André, who is an ITFA board member and head of the Fintech committee, was instrumental in setting the conference agenda to include sessions on digital assets, NFTs, and the metaverse and their potential roles in global trade.
• Decentralized Exchange (DEX) volume continues to grow at a steady pace to support projects within the XDC Ecosystem.
• The XDC community provided leadership and engagement at key crypto and financial technology events — including FT Live, Mainnet, Permissionless, Coverge2022, Benzinga, CordaCon and GTR NY.
• The XDC Network was named a finalist in the 2022 Fintech Finance Awards.
• XDC had several all-time high (ATH) social engagements as measured by Lunar Crush. These ATH events occurred due to enthusiastic social discussions by the XDC community and an increased volume of activity on the network.
• A number of NFT marketplaces have been delivered to the XDC Network and XDC community in a decentralized manner through the efforts of content creators and small businesses.
• Members of the XDC community participated in numerous panel discussions and AMAs throughout the year with exchanges, projects, and industry-focused forums.
• New social accounts were created to generate discussions about the network and increase participation from developers and other community members.
• Leaders from the XDC community hosted a number of events, meet and greets, and educational seminars at Audi Field in Washington DC and, through a partnership with DC United, facilitated global brand awareness for the XDC Network as a blockchain technology solution.

The XDC Network made significant progress last year. However, scandals, loss of trust, and adverse market conditions, which negatively impacted the global blockchain industry, still had an indirect effect on the XDC ecosystem. These challenging events and associated contagion created a number of unforeseen obstacles for our industry. Due to these challenges, our priorities required some restructuring.

After careful consideration of relevant factors, such as utility, maintenance cost, and usage rate, a number of products, including the following, have been suspended:

- XDC Network Stats (an alternative to network stats can be found here)

- XDC Observatory (an alternative explorer can be found here)

- XDC Smart Contract Manager

These products will be reevaluated in the future.

Despite the headline-grabbing challenges the industry faced in 2022, we believe blockchain innovation and adoption are still in their infancy. While many notable names in our industry were forced to shut down last year, the XDC Network once again found itself in a better position at the end of the year than at the beginning. As the XDC mainnet observes the calendar change for the fourth time, there is a lot to be excited about moving forward.

We look towards a bright horizon awaiting the XDC Network knowing that 2023 will bring XDC 2.0, which will provide a truly revolutionary advancement in blockchain security. The most intricate update since the XDC Network’s inception, XDC 2.0 is a next-generation consensus protocol that will detect and identify master nodes conducting malicious behavior, verify with forensic evidence, and slash them almost immediately. That military-grade security coupled with 2.0’s masterful forensics capabilities will provide the confidence institutions are seeking in blockchain technology — security, transparency, reduced counterparty risk, and cost-efficiency. Read more about this exciting upgrade in the whitepaper.

A major website upgrade is also coming in Q1 2023. On the new XDC.org website, visitors will find more accessible pathways to access developer tools and resources, enhanced marketing and branding for network-related resources and information, and ample learning opportunities for XDC Network enthusiasts.

We look forward to many more ecosystem milestones on par with those of 2022.

Here’s to a fruitful 2023 — both the steps forward that we already know about and those that will catch us all by surprise.

READ Article on XDC.dev.

XDC Network experiences a spectrum of innovation and adoption in 2022 was originally published in XDC Foundation Communications on Medium, where people are continuing the conversation by highlighting and responding to this story.

Most people are familiar with the aesthetic functions of non-fungible tokens (NFTs), but their capabilities actually include functionality that goes far beyond anything visual. Those who understand that NFTs can have real utility usually think of tickets or supply chain tools. But an NFT can also act as a key.

In the world of crypto, having multiple signatures required for wallet access allows for further security and further redundancy as well as a decentralized mechanism for giving multiple parties custody of assets in a wallet.

In addition, using a key to cast a signature on a multi-signature wallet allows users to easily move the access key to other devices. Users can even delegate their key to another smart contract for further functionality. Contract keys may be a popular contract design in the future due to their ability to hold NFTs as an access mechanism to the contract. As contracts become increasingly sophisticated, access keys may manage access rights for all users and contracts that use them, and can allow further automation when used within other smart contracts.

In this Multisig Key contract, I added in a few additional functions. Instead of tying each account to an address, I tied it to a token. This allows for users to use an NFT as a key to sign a proposed transaction. In theory, the NFT can act as a ballot to propose and vote on proposals proposed within the contract by any of the key holders. This means a multisig contract can be used to propose and vote on principal items by the key holders as well as act as a standing treasury for assets to be decentrally held in custody and voted on to be reallocated to other addresses.

The Multisig Key contract can primarily act as a decentralized trust, a dApp, DAO, escrow, or even a secondary wallet for someone who wants to have multiple protective measures to safeguard their assets. With any of these use cases, users can have a form of governance and community control over a given smart contract. In fact, they can make community-driven decisions by having each user hold a key which they use to vote. Additional means of governance can be programmed into the smart contract using the signer key tokens as governance tokens for any additional function created.

dApps and DAOs can also use this contract as a library for basic governance amongst a given set of users. Keys can be used to manage assets and votes within their applications, greatly increasing functionality of a dApp with little effort. As further libraries are built out, future dApps and DAOs will be able to gain greater functionality for less.

Github:https://github.com/CoinClubQuincy/Multi-Sig-Treasury

Managing MultiSigWallets with NFT Keys was originally published in XDC Foundation Communications on Medium, where people are continuing the conversation by highlighting and responding to this story.

Ethereum is preparing to carry out an unprecedented merge — going from a Proof-of-Work (PoW) model to a Proof-of-Stake (PoS) model. Ethereum originated as a PoW network that requires a mining process to validate transactions. As the network’s volume grew over time, this mining process became cumbersome. As a result of that, users now experience long settlement wait times and expensive transactions.

The Ethereum developer community saw an opportunity to transition to a new form of consensus, PoS, which requires no mining, and will, in part, future-proof the network. Using this consensus mechanism, validators must stake ETH in order to participate in the validation process — similar to the way delegated proof of stake validators must stake XDC on the XDC Network to participate in the validation process. The conversion has taken several years of planning and testing and will begin its transition to PoS this week.

This is a promising development for our planet, for users of the Ethereum network, and for blockchain as a whole. The industry is watching closely in anticipation of this monumental event.

After all, the entire industry bears the brunt of criticism about blockchain over its sustainability concerns. These critiques often don’t specify which network they are implicating, and paint all blockchain networks with a broad brush. As Ethereum’s native coin, ether, represents 20% of the entire crypto market cap — and a greater share of the entire space using other metrics — we’ll all feel the impact when Ethereum advances and becomes friendlier to our planet, reducing 99% of its energy usage. By extension, this will mean less cost to support the entire crypto ecosystem and more capital to move freely.

When switching to PoS, this energy efficiency comes at very little cost. The PoS model is proven to be virtually as secure as PoW. Transactions process quicker, and they are more scalable — with potentially thousands of transactions per second.

XinFin’s founders knew back in 2018 that Proof-of-Stake was key to bringing enterprise and institutional actors on board, particularly in trade finance. Over the past year and half, XDC has achieved key milestones in this space, including being named as the blockchain member of the Trade Finance Distribution Initiative (TFDi) and becoming home to an increasing number of Layer 2 projects. One of those projects, TRADA, is allowing both retail and institutional investors increased access to trade finance as an investment class. Like Ethereum, XDC is open-sourced, EVM-compatible, and developer-focused.

To be used for sensitive data and transactions, a network ought to be green, efficient, and secure. In fact, to take security to an unparalleled level, XDC’s protocol team is currently testing XDPoS 2.0, which will be launched in the earlier part of next year. XDPoS 2.0 will root out bad actors by incorporating forensics holistically, meaning that internal mechanisms will identify and automatically root out malicious masternodes. This can’t be said of any other blockchain currently in existence — including those in the production and design stages.

A network should also be relatively cheap to use for your average user. The Proof-of-Stake model allows XDC transactions to cost fractions of a penny. While this merge is not supposed to lower Ethereum’s transaction fees immediately, it certainly opens up those possibilities in the future.

Our entire blockchain ecosystem is better when one of its most prominent chains makes the choice to switch to one of the most future-proof protocols. With a Proof-of-Stake consensus mechanism, the possibilities are endless. Ethereum was, after all, the first blockchain to allow for programmable smart contracts. The XDC Network is building upon what they started.

The content above represents my own individual perspective as an XDC community member and does not reflect the official stance of XDC Foundation.

Ethereum’s Protocol Upgrade Offers Significant Advancements to the Industry was originally published in XDC Foundation Communications on Medium, where people are continuing the conversation by highlighting and responding to this story.

The XDC Network was featured at the 48th annual International Trade and Forfaiting (ITFA) Conference, held last week in Porto, Portugal.

XDC Network is the only Layer 1 blockchain network member of ITFA (SRX also received membership, an XRC20 project) — the worldwide trade association for entities engaged in global trade, forfaiting, supply chain and receivables financing. The conference programming drew attention to a number of projects built on the XDC Network. Some highlighted events included:

1. In his welcome address, ITFA Chairman Sean Edwards discussed the TRADA Token launch this summer on the XDC Network.

2. As ITFA Board Member and Head of Fintech Committee, XDC Foundation Advisor André Casterman, Founder & Managing Director of Casterman Advisory, was involved with the conference’s agenda and its participating industry experts. He stated that digital assets would be a major focus as well as the use of tokenization, NFTs, and security token offerings.

Mr. Casterman kicked off the half-day Fintech programme with a session on Digital Assets and invited Mr. Christoph Gugelmann, Founder and CEO of Tradeteq, to present the result of the partnership between his company and XDC Network known as the TRADA Token which was launched in July 2022.

Mr. Casterman also moderated a panel discussion on The Metaverse, NFTs and other things you should have heard about . . . The discussion centered around the cutting-edge potential these popular blockchain products have in trade. They are not just for games and artwork. Speakers included:

• Marc-André Schauwecker — Head of Legal & Compliance, OTC Service AG and Angle Investor Metaverse
• Megha Shrestha — Co-Founder and CEO, Metabloqs (powered by XDC Network)
• Merisa Lee Gimpel — Managing Director, Head of Lending, Trade & Working Capital Solution Development, Lloyds Bank and member of DNI Initiative

Nils Behling — Founder & CFO, Tradeteq and member of TFD Initiative

Following both sessions featuring the TRADA Token, delegates could discover more at the TFD Initiative booth and sign up on www.xdcteq.io.

3. Ian Duffy, Founder and CEO of Accelerated Payments, joined a panel of speakers to discuss the topic, Has Asset Management embraced trade finance and what more is left to be done? Accelerated Payments participated with Tradeteq in September 2021 to launch the first NFT representing trade finance assets on the XDC Network.

4. Troy S. Wood, CEO & Founder of Impel, was interviewed at the conference and discussed the Impel project that provides ISO 20022 compliant financial messaging with optional instant-settlement by adding digital assets like $XDC to the messages payload. He also gave an overview of financial obligation settlements via Impel’s R3 Corda | XDC Network Bridge — all powered by the XDC Network.

5. XDC Network sponsored the conference breakfast on the final day.

The conference also highlighted current initiatives such as the DNI Initiative to promote the digitization of bills of exchange and promissory notes and the TFD Initiative to improve access to the trade finance asset class. The XDC Network was built to support these efforts in trade finance and enterprise, in general.

The XDC Network is an enterprise-grade, EVM-compatible Layer 1 network equipped with interoperable smart contracts. A highly optimized, bespoke fork of Ethereum, the XDC Network reaches consensus through a delegated proof-of-stake (XDPoS) mechanism, which allows for two-second transaction time, near zero gas fees, and over 2,000 transactions per second (TPS). Secure, scalable, and highly efficient, the XDC Network powers a wide range of novel blockchain use cases.

XDC Network at ITFA Porto 2022 was originally published in XDC Foundation Communications on Medium, where people are continuing the conversation by highlighting and responding to this story.

Happy Birthday, XDC Network!

Today, June 1, 2022, the XDC Network’s mainnet has been operating for three years strong. XDC Foundation and the XDC community have been so busy with upgrades, integrations, and XDPoS 2.0 that we almost missed this opportunity to smile and celebrate. Let’s pause briefly to acknowledge the hard work that has gone into developing the XDC Network and nurturing the ecosystem, and thank the vibrant community that supports it.

XDC Foundation — stand up and be counted

XinFin Fintech launched the Layer 1, enterprise-ready XDC Network mainnet on June 1, 2019. Led by co-founders, Atul Khekade and Ritesh Kakkad, XinFin’s development team spent the bulk of the first two years focusing on network integrations and further grooming the mainnet for the trade finance and financial enterprise industries.

In order to focus on these technical priorities, a broader team was cultivated to steward the growth of the network in a more robust capacity, and in mid-2021, the XDC Foundation was formed as an organization to serve and support a variety of ecosystem needs. The Foundation would form a team dedicated to introducing and supporting ecosystem participants, as well as to foster awareness and development on the network. This team spans the globe geographically with a concentration of members throughout the West.

With a broader network user base in mind, the XDC Foundation team got busy creating the following feature-rich network applications:

• Origin v1.0. XDC Network’s no-code smart contract tokenization platform.
• Observer v1.0. The network’s feature-rich block explorer and analytics platform. (temporarily decommissioned)
• Network Stats v1.0. The network’s stats monitoring platform. (temporarily decommissioned)
• SDKs. Numerous software development kits to assist developers in building on XDC Network.
• Smart contract deployments. As an EVM-compatible Layer 1 blockchain, XDC Network saw a jump in smart contract deployments from 755 a year ago to over 8,000 today.
• XDC.org v1.0. The community-centric XDC Foundation website launched in Q1 2022.

Read: XDC Network Achieves Major Milestones in 2021

Trade Finance, Tokenization, NFTs, and Security

While most of the above-mentioned releases were introduced without much fanfare, one significant event at the beginning of our third year instantly positioned the XDC Network as a go-to blockchain for enterprise applications. In September 2021, the world’s first NFT (as a single XRC20 token) backed by trade finance assets and following unique trade finance industry messaging standards, was deployed on the network. The NFT was created by a member of the World Economic Forum: Global Innovators Community, Tradeteq, and the transaction was conducted with invoice financing company, Accelerated Payments, as the asset originator. The transaction demonstrated how trade finance assets could be made available through blockchain-based systems to those interested in this lower-risk investment sector — one that has previously been available only to a handful of investment banks.

Furthermore, with this development and the broader investment market, the trade finance gap could shrink significantly as technology emerges to improve access to affordable trade finance for small-to-medium sized enterprises (SMEs) based in developing and emerging markets.

In addition to the major efforts put forth by the above-mentioned parties and others, including André Casterman, this significant milestone on the XDC Network follows Atul and Ritesh’s vision for a low-cost, high-speed, and uniquely secure enterprise blockchain. In fact, security is at the forefront of the network’s capabilities and was outlined in the whitepaper, Accountability and Forensics in Blockchains: XDC Consensus Engine DPoS 2.0.

Co-authored by Dr. Fisher Yu, a senior advisor to XinFin and the XDC Network, the paper introduces the XDC Network’s upgrade to XDPoS 2.0 and highlights the advanced Byzantine Fault Tolerance consensus protocol and the military-grade security and performance empowered by the upgrade. It stresses the low resource consumption and fully backwards-compatible characteristics of the network. Read more about the upcoming release of XDPoS 2.0.

XDC Network’s capabilities in enterprise applications, and specifically trade finance, earned respect in the broader global trade industry. In 2021, TFD Initiative, DNI Initiative, and the International Trade & Forfaiting Association all selected XDC Network as their first blockchain member; it remains the exclusive Layer 1 blockchain member of each as of this publication date.

SWIFT will implement ISO 20022 messaging standards for financial transactions beginning in November 2022. XDC Network is already one of the networks that is positioned to enable compliance with this new standard. It is not just for financial transactions — the standard can be used in other, more innovative ways to communicate data from one entity to another in a highly efficient transaction.

The Community Looks Forward

We often state that community is the heartbeat of the network. At this point in 2021, there was a much smaller team of community members supporting the project in various capacities, including by building on the network and introducing other ecosystem participants like exchanges, wallets, and development partners. The community has since blossomed into a broader yet focused group motivated by the growth and adoption of the XDC Network. The XDC community continues to expand and develop projects centered on NFTs, the metaverse, financial enterprise applications, and DeFi — all on the XDC Network. From its first days, XDC Foundation has operated with an eye towards further decentralization and has fostered a community-first development approach as we shepherd the network to new heights.

Bridges. As a blockchain optimized for interoperability, the XDC Network has the opportunity to be a network of networks. We are happy to report our community and ecosystem teams continue to focus on building interoperability with other blockchains and legacy financial systems. We have long believed that blockchain’s future calls for it, and one of our early bridges was formed with enterprise users in mind. Built through DASL, the Corda bridge offers an interoperable platform for Corda users. We are collaborating with several other projects in the interest of interoperability as we look forward.

We anticipate some the following additional events in the future:

• ISO 20022 messaging platform developed by Impel
• Plans for net-zero carbon footprint with a net-negative footprint by 2023
• XDPoS 2.0 launch

Thanks for sharing these moments with us and joining the XDC Foundation on the journey to come!

XDC Mainnet — Three Years Strong was originally published in XDC Foundation Communications on Medium, where people are continuing the conversation by highlighting and responding to this story.

Late last year, news of the XDPoS 2.0 protocol enhancement was met with enthusiasm from members of the XDC community, but its significance was not totally realized. In fact, most who welcomed the new proof of stake protocol were under the impression that it was released in December of 2021 as part of the Andromeda XDPoS update. While this update did improve security and efficiency, while also adding new functionality, it was not a major innovation to the blockchain network — at least not compared to what is on the horizon.

In reality, XDPoS 2.0 is a major milestone, by far the most intricate upgrade since the XDC Network’s inception — as evidenced by the full year of beta testing required before the new protocol is set to be implemented in the first quarter of 2023.

While daily life in the metaverse has yet to come to fruition and so far we have managed to escape full-scale cyberwars, we do live in a world increasingly dependent on computer technology. Blockchain — being one of the most secure ways for people to more efficiently store and exchange data, assets and ideas — is positioned to be a big part of our future.

We cannot prevent bad actors from trying to manipulate the array of the cyber networks that support our 21st century lifestyles, but the systems people rely on must stay ahead of these increasingly sophisticated wrongdoers. Look no further than the hackers who brought a major gas pipeline to a halt in the summer of 2021. Cybersecurity is merely security. Online breaches have ever-growing real-world consequences.

Blockchain is not immune. In March of this year, the largest hack in the history of decentralized finance took place, as $600 million in digital assets were stolen from the Ethereum based Ronin Bridge.

A proof of stake blockchain network is extremely resistant to attempted hacks, as long as its validator nodes work efficiently and effectively. The issue is validator nodes work right — until they don’t. However remote the possibility, a malicious takeover of a large number of a proof of stake blockchain’s validator nodes would be catastrophic.

As blockchain aims towards institutional uses — such as use of the XDC Network in trade finance — worst case scenarios must be mitigated. Just as a nuclear plant has layers of failsafes to protect the public, decentralized networks must protect all who use them. The speed, efficiency and utility of decentralized networks cannot come at the expense of security.

The XDC Network, using its current XDPoS 1.0 protocol, is a longest-chain network that applies a combination of delegated proof of stake and proof of work to secure the network while also achieving fast confirmation. It is already near impossible to execute a hostile takeover, as it would require widespread collusion between those who hold validator nodes. As these holders have at least 10 million XDC and are paid a percentage of that annually as a reward for validating transactions, they all have a stake in the success of the network. On top of that, node operators are decentralized and scattered across the world, and must complete a know your customer (KYC) process. However, one can never be too secure.

XDPoS 2.0 was developed by the team of Princeton University’s Professor Pramod Visawanath and Hash Laboratories’ Dr. Fisher Yu — both of whom serve as senior advisors to the network. This protocol is designed to not only withstand up to 1/3 of the master nodes going rogue, the theoretical limit of any Byzantine fault tolerance protocol, but in a situation where more than a third of nodes act maliciously, it can detect and attack almost instantly. This first-of-its-kind governance platform will identify malignant nodes, with proof, and slash them almost immediately — involving burning their 10 million XDC tokens and all rewards that come with being a node owner. Because of KYC, these individuals could be further prosecuted.

XDPoS 2.0 will be the judge, jury and executioner regarding malignant network activity — and that is novel. A blockchain network has never had an automated judicial system before. This momentous development can be called Blockchain 4.0.

As mentioned at the start of this piece, XDPoS 2.0 will continue to be tested until the early part of 2023, ensuring that the upgrade works as planned.

To that end, extreme scrutinies will be applied to XDPoS 2.0 before it becomes ready for mainnet launch next year:

• All the upgrades will be thoroughly tested in dev-net and test-net. Simulated attacks and pressure tests will be performed.
• A seamless version switch mechanism will be designed, tested, and practiced with the community using dev-net and test-net.
• A contingency plan will be designed, tested, and practiced with the community using dev-net and test-net.
• All components that will be affected by the upgrade (such as wallet and blockchain explorer) will be upgraded and tested as well.
• The upgrade will run in test-net for a sufficiently long time to receive community feedback and approval.
• Comprehensive documentations will be prepared.

We suggest you read the entire 15-page paper detailing XDPoS 2.0, which describes things best:

“Under the current blockchain architecture, which lacks a judiciary system to ensure accountability, enterprises are asked to trade a material advantage, in this case security and control within their current system, in exchange for a solution deemed to be morally superior — an arrangement equated to a reverse Faustian bargain, unlikely to be accepted.”

It continues:

“We … are challenged to create a psychological on-ramp for institutions … reinforced by a promise of security, transparency, reduced counter-party risk, and cost-efficiency. Opportunely, these are all advantages inherent to the XDC Network.”

While there are proposals to eventually create new blockchains with similar capabilities, no blockchain currently in existence — including the production and design stages — incorporates forensics holistically. That includes Ethereum 2.0.

XDPoS 2.0 is the first, but likely not the last. Years from now, we expect many blockchains to implement forensics monitoring and security. The novel tech has already captured the attention of many notable blockchain scientists, including some of the minds behind Facebook’s Diem (as per a Diem improvement proposal). Right now, the XDC Network is spearheading this revolution.

XDPoS 2.0 is Right Over the Horizon was originally published in XDC Foundation Communications on Medium, where people are continuing the conversation by highlighting and responding to this story.

Blockchain technology can be used to implement a collection of different tools. Most deal with finance or automations, but what I want to talk about is personal data and self custody of information.

Legacy applications currently run on third party servers hosted by a company. With this comes big risks. Data leaks, corporate hacks, or any other compromise of user information.

Most users are familiar with Know Your Customer (KYC) conditions of financial institutions — be it a bank, a broker, or some application with requirements to identify users for regulatory requirements.

Applications in Web 2.0 meet these conditions by possessing user data in their databases and verifying the user data within their own systems, as each application has its own means of collecting, verifying, and storing user data. This is a security concern, as users are reliant on the security of the different applications to secure their personal Identifiable information (PII). This information could be breached or leaked by any of the applications, leaving users’ private data exposed.

The XDC Network offers the potential to mitigate that risk by hosting private userdata on the blockchain. Data stored privately in a contract cannot be leaked or stolen as in a typical relationship database. I have previously written about storing private data with a token and creating user logins.

We can also store identities and verify them. Without the need for a 3rd party to host the data, leaks and hacks can be mitigated and redundancy of data can be reduced.

In The Delegated_Authority.sol contract example I provide PII data for:

1. (Public) Legal Name
2. (Private) Address
3. (Private)Passport ID
4. (Private)Social Security Number
5. (Private)Driver’s License Number

But any necessary data can be modified to suit the required needs of the delegated authority.

A delegated authority is a dApp who would verify the identity of their users then having a boolean status result presented to third parties who have delegated trust to the delegate contract to give accurate results. The delegate contract is a contract who will deploy a series of smaller contracts that hold the user private data and will be allowed to view and notarize the identities of the contracts. Delegated authority contracts will have authentication tokens associated with them, only the possessor of which can read and notarize the identity of a user. These delegated authorities can be banks, financial institutions, or any establishment that is required to verify PII data on their users.

For example if a bank needs to verify an identity of a user to create an account the bank can launch a delegate authority contract and as users submit information to confirm their identities there will be a new generated contract that will hold their data and issue a token to show that the new generated contract belongs to them. With this other applications like an exchange can delegate the task of authorizing and confirming the identities to the banks delegate contract,which can check to see if the users KYC contract has been notarized and can check to see if the current user is holding the token that represents the Identity of the KYC contract they was generated when the user submitted their KYC info to the delegate authority.

On the XDC Network, a smart contract created by the delegated authority will allow for users to enter some know your customer (KYC) Personal Identification information (PII). This will create a separate KYC contract that contains the PII data of the user, and will generate an ID token for the user.

This ID token can be used as a form of notarization to third party dApps that they are the correct Identity of KYC contract and can view contents of the contract to view the PII data. Only the delegated authority will also have permission to view the contents of the generated KYC contracts as well as store and notarize authenticity and the status of said contracts. When a KYC contract has finally been notarized, either manually or programmatically by the delegated authority, third party dApps can check the validity of any given KYC contract from the delegated authority. If the user in the dApp possesses the ID token produced by the contract, their identity is confirmed.

The delegated authority contracts can even monetize their authority by charging micro fees to check the validity of a contract. Delegated authorities can bear the risk of notarization while being compensated for that risk. While dApps can offset the responsibility and resources to notarize identities for a fee and focus on other tasks.

[Notary Contract]

[KYC Contract]

This will allow for a reduction in redundancy, as a user can notarize his or her data just once before carrying it to multiple dApps. The security of the authentication token mitigates risk by securing access to the data. This is similar to how you would hand a security key to a key management service (KMS) instead of hosting user data in a database.

Blockchain dApps can finally have a means of compliance with KYC standards while offsetting risk and freeing up resources. Delegated authorities can be the gateway between legacy systems and blockchain by notarizing and tokenizing identities for easy use and even monetization by third party dApps who seek top notch security.

This can be the future of identification, passports, and all other sorts of verification. All it takes is trusting a delegated authority to move identification data on the blockchain.

About the Author: R Quincy Jones XDC Foundation developer, who on behalf of the XDC Network is building new standards and applications for the XDC Network. With over four years in cloud development, and a growing following on YouTube: CoinClubCrypto, is well-suited to break down the fundamentals of blockchain-based technologies for general audiences.

GitHub Link: https://github.com/QCloud-DevOps/Delegated_Authority

The content above represents my own individual perspective as an XDC community member and does not reflect the official stance of XDC Foundation

Delegated Authorities & Notarizing Identities on the XDC network — #BuildItOnXDC was originally published in XDC Foundation Communications on Medium, where people are continuing the conversation by highlighting and responding to this story.

Policy and Adoption

The report is timely in portraying the international spirit of cooperation needed to propel trade technologies forward. One notable component in the report is the important role that policy making has around the adoption of TradeTech. They stress that a level playing field for all size countries and organizations can be achieved, in part at least, through considerate and deliberate policy making. Since trade is global, synchronized global adoption will be good for all of trade.

To be clear, in trade and trade finance, in particular, there is already an imbalance between those who are able to secure financing and those who cannot. Small-to-medium sized enterprises (SMEs) have long been denied access to traditional financing opportunities that routinely go to larger, more established trade organizations. This has resulted in a $3.4 trillion gap between financing requests and financing made available in the industry. Read more about this problem and a novel solution in this post.

The trade finance gap is a major problem that the trade industry can address with the growth and implementation of trade technologies. As addressed in the WEF/WTO report, policy making and the even adoption of technologies are major considerations in achieving recovery and well-balanced growth in global trade. Technology-neutral trade agreements will be vital as internationally coordinated tradetech policies are developed and implemented in the coming years.

How Cryptocurrencies Provide Structure for Panama

Transparency. While critics are quick to point out the dark money aspects of cryptocurrency, blockchain technology can actually provide more transparency into financial activity. Most transactions settle on a public ledger, and although the digital wallet addresses are not always identifiable by a person’s identity, blockchain analytics platforms and forensics have come a long way in identifying bad actors and addressing criminal activity. For example, there are now much higher success rates in uncovering criminal patterns of on-chain activity and recovery of stolen or dark money. The Colonial Pipeline hack in 2021 involved a ransom note demanding cryptocurrency as payment. Roughly half of the $4.4 million paid in bitcoin was recovered by the F.B.I. and Colonial Pipeline through a blockchain tracking process.

Also, Chainalysis, the investigative digital platform, now offers sanctions wallet screening for the entire cryptocurrency industry, free of charge. Blockchain Intelligence Group delivers an intelligence ecosystem with best-in-class crypto tracking, analytics, risk monitoring, compliance, attribution, visualization and tracking, with which XDC Network is integrated. And while much attention is focused on crypto crime rates, traditional financial crime rates remain far higher.

Financial Inclusion. Although Panama enjoys a relatively strong economy, some statistics hold that one-third to one-half of all Panamanians are unbanked. The country has a high rate of internet penetration which provides fertile ground for crypto adoption among both consumers and businesses. Paying for goods and services with crypto does not require a traditional bank account and the due diligence required by banks to open and maintain the account. Furthermore, a person can trade with crypto through a digital wallet and an initial on-boarding of funds. A wider variety of investment options will come as well.

Regulatory Oversight. For all the struggles El Salvador has had in mandating that businesses must accept bitcoin as legal tender, Panama seems to be taking the right approach with its cryptocurrency legislation. Once signed, the new law will present stark differences in its approach as Panama will broadly allow public and private use of crypto assets but will not require its use or acceptance. Businesses can opt to accept payment in crypto but will not be required to do so. Likewise, citizens can pay their taxes and other obligations in crypto.

The law allows for the issuance of digital securities and the tokenization of assets as well as the creation of new payment systems.

Legal Stability. Through regulatory oversight and guidelines for use, Panama’s neo-crypto industry should attract more economic investments and ideally generate more employment. The government is taking a methodical and regulatory-based approach with the project. Interoperability with its existing banking structure, for instance, will be a hallmark of new crypto business activity there. Instead of cryptocurrency investments replacing bank activity, banks will be encouraged to participate through various integrations, such as on-ramp and off-ramp services to fiat currencies and establishing new payment rails for their customers.

The Ministry of Commerce, the Superintendency of Banks of Panama, the state-owned Banco Nacional de Panamá, the Authority of Innovation of Government (AIG), and the Ministry of Economy and Finance are all participants in this initiative, and they are staking their reputations to boost the country’s status as technological innovators.

A sovereign nation’s adoption of crypto leads to TradeTech opportunities

As more and more countries adopt cryptocurrencies in one form or another, it sends the message that crypto has treaded further into the global monetary system. It increases adoption pressures throughout that country’s economy which can then trickle out globally. And in some cases a country’s adoption of cryptocurrencies may have significant ties to global trade.

Panama, the narrow land (the isthmus) connecting Central and South America, is bordered by both the Atlantic and Pacific oceans. Its man-made Panama Canal is one of the world’s most important shipping passageways and, therefore, a vital component in global trade. As if in lock-step with the WEF/WTO report, Panama’s legislative body approved a bill to regulate the use of cryptocurrencies in the country. Both private and public use was approved, and, at the time of writing, the unanimously passed bill awaits President Cortizo’s signature.

While other countries have approved the use of cryptocurrencies, there are some inherent differences in the way they will be allowed for use in Panama. Firstly, crypto will not become legal tender, and it will not become a requirement for any person or business to use it or accept it. It can, however, be used to pay federal taxes.

In addition, the country carefully curated a selection of currencies for regulated use at the time of writing. The obvious bitcoin and ether made the list, and there are only seven other approved currencies that will be added. They include Algorand, Elrond, IOTA, Litecoin, Stellar, XRP and XDC. Each was chosen for the unique benefits they would bring to Panama’s initiative to leverage this new monetary system for innovation, advanced payment mechanisms, financial inclusion, and global trade. That Panama will now formally regulate and allow the use of cryptocurrencies in addition to its legal tender, means the country is positioned as a model for others to follow suit.

ISO 20022 is a Game Changer for Panama

As Panama seeks to become a hub for innovation, global trade is a natural area of influence for them. The Panama Canal passageway sees roughly 5% of all shipping traffic, and the country’s open shipping registry accounts for 21% of the world’s fleet. Blockchain technologies can enhance trade development by supporting supply chain activities and trade finance. As an important shipping port, business development should increase in Panama City as trade businesses seek regulated and innovative technological solutions.

XDC is one of Panama’s approved cryptocurrencies and is the utility token for the XDC Network — an enterprise-ready public/private blockchain that is efficient, secure, and scalable. The network has seen recent innovative use cases in the area of trade finance. In September 2021, the world’s first trade finance NFT was built on this blockchain, and that tokenization effort opens up the possibility for trillions of dollars in trade financing to become available on an accessible, visible blockchain network in a way it hasn’t been available prior. Panama’s blockchain-friendly and regulated business environment will attract trade businesses that seek these types of financing solutions — important solutions that have not been possible through traditional financial means.

Another notable distinction the XDC Network holds is its compliance with ISO 200022 messaging standards. ISO 20022 is a common language for payment transactions worldwide. It is the message that accompanies a cross-border transfer of funds and provides the receiving institution with the payment details. In November 2022, SWIFT will require all international funds transfers to utilize this new messaging standard. As a blockchain payment rail, the XDC Network is currently one of the select networks capable of handling transactions that can meet this standard. Financial institutions and non-bank financial institutions will seek a stable ISO 20022 provider when exploring blockchain solutions.

Conclusion

Panama strives to be a model of crypto innovation and opportunity. The legislative body’s due diligence can only positively influence the implementation of this initiative. Panama’s promise of TradeTech beckons other countries’ pursuits of thoughtful and responsible cryptocurrency adoption and the benefits blockchain technologies can bring to their economies.

TradeTech: The Promise of Panama was originally published in XDC Foundation Communications on Medium, where people are continuing the conversation by highlighting and responding to this story.