EY’s Asia Pacific Blockchain Summit took place for the second time in Shanghai on November 6. It was an opportunity for EY to showcase its most recent blockchain projects happening around the globe, as proofs of concept or in production. Here are my key observations from this event.
EY Is Betting On Public Blockchain For Enterprise Usage
As Forrester put it in our 2020 blockchain predictions, executive teams will be drawn into a permissioned versus public network debate.[i] During the event, Paul Brody, EY global blockchain leader, stressed that, in his opinion, enterprise blockchain deployments would shift from permissioned to public in the future. To support this, EY is experimenting with a new set of open-sourced protocols dubbed “Nightfall” that leverages zero-knowledge proofs (ZKPs) to protect the privacy of transactions on the blockchain while enabling information sharing between blockchain participants.[ii] Nightfall and all EY blockchain projects are running on Ops Chain, a homegrown enterprise-focused version of Ethereum with additional permissioned blockchain services. With Nightfall, Ops Chain aims to solve many of the common public chain issues for enterprise usage such as scalability, throughput, data privacy, and compliance. I anticipate that its adoption will take some time to scale globally, but in China, where the regulations on business governance are more relaxed than the West, the adoption is likely to be accelerated, especially given the recent unequivocal government support.[iii]
Governments And The State-Owned-Enterprises (SOEs) Are Likely To Lead Blockchain Adoption In China
Warren Wang, blockchain leader for EY China, presented two blockchain projects running on Ops Chain at the summit, both of them realized in cooperation with local governments or SOEs. The first one enables intercompany transactions for State Grid Zhejiang (an SOE); the second one is a digital ecosystem for Shanghai’s customs-free trade zone. Large and powerful organizations like State Grid and China Customs will undoubtedly play a big role in driving and empowering blockchain development in China. These two projects have made some progress recently through the partnership and are also aligned with the recent blockchain call made by President Xi. In particular, firms from different industries show increasing interests and enthusiasm to participate in the China Customs project. State Grid has also set up a blockchain subsidiary to accelerate and scale up all blockchain projects that involve their subsidiaries, like State Grid Zhejiang.
[ii] Source: Chaitanya Konda, “Introduction to EY Nightfall — How does it make token transactions private?” Medium, June 10, 2019 (https://medium.com/@chaitanyakonda/nightfall-makes-token-transactions-on-ethereum-private-how-does-it-work-acf2ffd0aa7a)