Position Statement by Kenji Saito

Author: Kenji Saito
Senior Researcher, Keio Research Institute at SFC, Keio University
Chief Science Officer, BlockchainHub Inc.

My background in blockchain technology

I published a design and reference implementation of a digital currency as early as 2003. I think I was aware of Bitcoin when it started in 2009 (as well as an early design of Ripple in perhaps 2004), but began serious investigations of the technology only in mid 2013. Since then I have made numerous statements to criticize Bitcoin and blockchains primarily in Japanese language. I also wrote several books introducing Bitcoin and blockchain technology, their problems, potential applications and social impacts, in Japanese.

From January 2015 to April 2016, I was the Chief Architect/Scientist/Consultant of a blockchain-related, Tokyo-based startup named Orb Inc. (frequent changes of my title shows how the management was confused what I was), where I designed and implemented an extended blockchain core named “Orb 1 Core” from scratch. The core has been designed to mitigate most of the negative consequences I have made clear on Bitcoin blockchain, and is being used in Orb’s “smart coin” products, experiments on real-estate trades, and several other applications that have not yet been publicized. Today, I am the Chief Science Officer at BlockchainHub Inc., another Tokyo-based startup to support developers and users of blockchain technology, where I give lectures on blockchains and other distributed ledgers, and provide consultations to the industry. I have been a senior researcher of the Internet and Society for many years at SFC, Keio University, under the leadership of Prof. Jun Murai, the Japanese father of the Internet and Deputy Director of W3C/Keio.

I have made two academic publications on blockchains:

  1. Mitsuru Imamura, Yukinobu Kitamura, Tsutomu Matsumoto and Kenji Saito, “Can We Stabilize the Price of a Cryptocurrency?: Understanding the Design of Bitcoin and Its Potential to Compete with Central Bank Money”, Discussion Paper Series A No.617, Institute of Economic Research, Hitotsubashi University / id 2519367, Social Science Research Network, November 2014.

  2. Kenji Saito and Hiroyuki Yamada, “What’s so Different about Blockchain? Blockchain is a Probabilistic State Machine”, The 1st Workshop on Edge Computing (WEC 2016) in conjunction with IEEE ICDCS 2016, June 2016 (to appear).

Topic I would like to lead discussion on

Through my experiences in the industry, I found that one big challenge is how we can map between physical or logical entities and digital assets, including human identifiers as a special and important case, which are recorded and managed in distributed ledgers. For example, if we manage real estates on a distributed ledger, the physical properties (and their owners) must be mapped to corresponding digital assets on the ledger, but the correctness of the mappings needs to be ensured somehow. This cannot be achieved by the ledger alone. I know that the workshop focuses on technology, but there are technological and political issues that cannot be separated. How we can regulate those mappings would depend on the technological design, and vice versa.

This topic can be related to the web in two ways:

One subtopic is, assuming that such mappings are correct, how the web allows and supports manipulations of physical or logical entities through their digital representations on the ledgers. The web itself is a digital technology, so any physical entities need to be logically represented on the web first (this would lead to the second subtopic), and then get manipulated.

Therefore the question is more generally stated as, how well can we connect web elements with digital assets on distributed ledgers?

Answering the question would allow, for example, a real-estate marketplace provably backed up by a distributed ledger, or any provable versioning of web pages. Everyone would be able to validate whether the state of an element on the web is genuine or not, and browse the history of changes.

The second subtopic is, how the web can contribute to making such mappings between physical or logical entities and digital assets to begin with. If the first subtopic is given an answer, then ensuring correct associations between physical entities and their logical representations on the web would suffice (Fig 1.).

Physical Entity <=subtopic2=> Elements on the Web <=subtopic1=> Digital Asset on a Ledger

Fig. 1 - Connecting the physical world and a distributed ledger

So the question is, are existing mechanisms that connect the real world and the web sufficient as the foundation for connecting the real world and distributed ledgers, or do we need updates? This question views the techno-political problem from a technological perspective. This may be related to ontologies.

Other topics I think the workshop should cover in order to be effective

I think we may want to clarify the extent to which blockchains and the web can be associated with one another.

As an example point of view, the web is not symmetric, and does not seem compatible with the features of blockchains that give total controls to the ends that materializes the end-to-end philosophy in the areas of controlling assets.

We may want to first draw a big picture of the scopes of the web and blockchain technology, and discover their intersections, so that we share the same understanding of focal points where we can be more productive.