© 2016 IBM Corporation

Making Blockchain Real for Business

How we can help you

Esra UFACIKesra@sg.ibm.comBlockchain IOT Lead for AP Systems

Businesses must carefully evaluate where blockchains provide the greatest gains

§ Limited value within the boundaries of one organization

§ Ecosystem participants have to agree on a standard

§ Risk of overregulation without coordinated control

§ May require large scale re-engineering

Blockchain considerations

Blockchain – not for all …

NEGATIVE Indicators1. Need high performance (millisecond) transactions 2. Small organization (no business network)3. Looking for a database replacement4. Looking for a messaging5. Looking for transaction processing replacement

§ Transfer of high-value financial assets§ Many participants in one market§ Regulatory timeframes

§ Sharing of assets (voting, dividend notification)§ Assets are information, not financial§ Provenance, immutability and finality are key

§ Created by a small set of participants§ Share key reference data§ Consolidated, consistent real-time view

§ Real-time view of compliance, audit and risk data§ Provenance, immutability and finality are key§ Transparent access to auditor and regulator

High-Value Market

Asset Exchange

Consortium Shared Ledger

Compliance Ledger

Adoption patterns are emerging: an example from simple compliance ledgers to high-value markets

Source: IBM Institute for Business Value analysis

1How fast should I move?

2Can we achieve network-wide standards?

3How can I scale with new revenue models?

©2016 IBM Corporation 2 November 20165

We recommend businesses answer three questions to best extract value from blockchains

First movers and early adopters can position themselves for quicker returns

Dare to be first to market1§ Identify the most compelling use cases by considering which frictions are holding

you back

§ Experiment in discrete areas where the attributes of blockchains drive rapid impact

§ Use design thinking to simplify the user experience and create agile proofs of concept to drive rapid adoption

Collaborate broadly to achieve globally accepted standards

Success in blockchain adoption will depend onwho can build the strongest network

2§ Blockchain innovation can permeate even faster than the internet did generating a potential advantage

for first movers

§ Explore the role of alliances and consortia and how profit pools might be redistributed, then decide on your network role

§ Consider the blockchain as the new business environment and collaboration as the optimal way of working, then consider with whom you should partner to create the optimal business network

Understand how blockchains can help your business profit and scale quickly

Scale with clear revenue models3§ As business models are disrupted by blockchains, think through how you can make money in

new ways, like from consumption-based pricing, licensing and micro-charges and payments

§ Explore how new blockchain-based services and apps can replace or complement and scale existing revenue models

§ Understand how blockchains will extract further value from other technologies, such as big data analytics, the Internet of Things and cognitive computing

Blockchain for Business – Our Point of View

Community + CodeLinux Hyperledger Project

Open Source Code: Blockchain for business;Consensus | ProvenanceImmutability | FinalityOpen Governance – 40 member cross industry board

CloudIBM Blockchain

Blockchain managed service on IBM Cloud and z Systems;Identity | Consensus | System Integration | Hardware-assist for Performance & SecurityIBM Blockchain on Bluemix

ClientsBlockchain SolutionsBlockchain Garage

Making Blockchain real for businessBlockchain Garage; New York | London | Singapore | TokyoBlockchain Services Practice

Enable adoption of shared ledger technology at a pace and depth not achievable by any one

company or industry

QUICK FACTS

Chairman: Blythe Masters/DAH

Executive Director: Brian Behlendorf

Tech Committee: Chris Ferris/IBM

Contribution: 44,000 lines of code in February 2016

Accept:2Q IBM Open Code accepted into incubation

Sprint to one codebase with unified thinking:

Target 3Q release

www.Hyperledger.org

Linux Foundation’s Hyperledger Project

§ Linux Foundation project announced December 17, 2015 with 17 founders, now 40 members

§ The Hyperledger Project is a collaborative effort to advance Blockchain technology by identifying and addressing important features for a cross-industry open standard for distributed ledgers that can transform the way business transactions are conducted globally

§ Open source and open standards-based

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12Page© 2016 IBM Corporation As of 13 June 2016

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IBM Blockchain on Bluemix

• Value:• Developers can stand up a

blockchain test network in under 2 minutes and quickly build & test an application on it. There are two plans — multitenant starter environment and high-security business environment.

• One IBM Blockchain Offering with two service plans

• Same IBM Cloud & Bluemix user experience

• IBM offers unique security and compliance differentiation for blockchain via high security plan

Starter Plan

High Security Plan

Client Acquires IBM Blockchain Service through Bluemix X X

Network Connections through Softlayer X X

Cloud Provisioning & Self Service Enablement X X

Service Management and Billing through Bluemix X X

Customer Support through Bluemix X X

Secure Service Container X

Highest levels of isolation in industry X

Compliance for highly regulated industries (tamper proof keys in HSM) X *

Accelerated performance X

* for GA

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Sample apps and tutorials for Blockchain

§ Sample applications and tutorials for IBM® Blockchain demonstrate how fundamental applications and chaincodes function in a blockchainnetwork. To learn more about the fabric code that is underpinning your blockchain network, visit the Docs section of the Linux Foundation's Hyperledger Project.

§ You can immediately deploy the Marbles, Commercial Paper or Car Lease demos to see chaincodeapplications in action. Keep reading to explore the Hello Chaincodetutorial.

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High Security Infrastructure for Blockchain

§ IBM LinuxONE: A highly secure infrastructure for blockchain networks§ Benefits and features include:

– Hardware cryptographic accelerators– Tamper-proof cards for key management– Application environment isolation via Secure Service Containers, protects data and

applications even from system administrators– World’s highest performance Linux-only system– Meets strictest requirements for Governments, Healthcare and Finance

§ IBM Blockchain LinuxONE network test environment available on Bluemix

Consensus Algorithm

Cryptographic Protocols(authentication, security, non-repudiation, restricted visibility, privacy/confidentiality,

….)

Smart Contracts

Shared Replicated Ledger

API Layer

App 1

App 2

App 3

. . . .

Business Rules Engine(embedded business rules execution engine)

Smart contract

stack

Blockchain DB

In Memory (7M tx, 100 TB -> 100MB) - z

Hashing – z

Integrate/Connect/Build on top of CICS/IMS/TPF/DB2/VSAM - zReal Time Blockchain - z

Elliptical Curve Digital Signatures - z

“-z” Existing z hardware acceleration

Blockchain on z Systems & LinuxONETM

§ Enterprise Public Key Crypto Standard 11 (PKCS 11) Compliant§ Federal Information Processing Standard (FIPS) 140-2 Compliant§ Optimized communication between blockchain/z peers§ Optimized communication between blockchain/z and z business applications

Smart Contracts

Shared Ledger

Up to 30x improvement with Linux on z Systems technology

Up to 10x improvement with Linux on z Systems technology

Infrastructure matters more than ever with Blockchain: Sustained performance

Protocol REST

Programming Language

Database

Container

Linux

Virtualization

IBM z Systems

GOLang 1.6rc2 linux/s390x

RocksDB 5.4.0Docker 1.8.0.3Suse SLES12 SP1Packages: gflags 2.0 (from tar file), snappy 1.1.1 (from tar file), zlib-devel(from distrib), libz1 (from distrib), libbz2-devel (from distrib)

z/VM 6.3, Dirmaint, RACF4x IFL(SMT2), 8GB4x CPACF for Crypto

LAB Environment

Yellow Network

(OpenVPN)

Open Block Chain

Hyperledger Stack on LinuxONE

Bluemix Blockchain Garages

URL

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URL

URL

1. Discuss Blockchaintechnology

2. Explore customer business model

3. Show BlockchainApplication demo

1. Understand Blockchain concepts & elements

2. Hands on with Blockchain on Bluemix

3. Standard demo customization

1. Design Thinking workshop to define business challenge

2. Agile iterations incrementally build project functionality

3. Enterprise integration

1. Scale up pilot or Scale out to new projects

2. Business Process Re-engineering

3. Systems Integration

Remote or face to face Remote or face to face Face to face Face to face

Free of charge Free of charge For fee For fee

Let’s Talk

BlockchainHands-on

First Project

Scale

Engagement model overview

© 2016 IBM Corporation

Thank you!