ISO May Propose Certified Standards for Blockchains and Distributed Ledgers

In April when the Bitcoin community began preparing for Australian Craig Wright’s “Satoshi Nakamoto reveal,” there was another announcement from Down Under that was overlooked.  

On April 14, Standards Australia, a non-government, not-for-profit standards organization announced that “Australia proposes International Blockchain Standards” and included a proposal for a “new field of technical activity.”

This proposal was registered with the International Organization for Standardization (ISO), the world’s largest developer of voluntary international standards, and on April 19, The American National Standards Institute announced that  “ANSI Seeks Comments on New ISO Field of Activity on Blockchain and Electronic Distributed Ledger Technologies.” The United States has access to the ISO standards development processes through ANSI.

Standards Australia also released an explainer fact sheet called “Blockchain & Electronic Distributed Ledger Technologies New Field of Technical Activity.” It ponders “Why do we need blockchain standards?” and postulates that:

“[…] Blockchain is still an emerging technology and issues such as data sovereignty, privacy, and lack of consensus are causing headaches for policy makers, regulators and industry alike. Notwithstanding, Australian stakeholders and government want this technology to be sustainable in the long-term. ISO and its members have an important role to play in making this a reality. …The proposed international standards for blockchain will focus on technical solutions that promote interoperability, and compatibility between existing systems. This will allow the technology to be more widely used and deployed.”

Bitcoin Is a Standard

As the “invisible ships” lore (or myth) goes: Native Americans could not perceive the fleet of ships about to invade their homeland because the armada was so alien to their collective experiences that they were unable to see their aggressors. One could make a similar comparison with groups seeking to standardize blockchains. Public blockchains such as Bitcoin or Ethereum are in and of themselves protocols or standards.  Institutions that are trying to (re)define what a blockchain is in the name of standardization are trying to co-opt the technology and may not even realize that they are staring at a standard.  A blockchain with(in) a layer of standards is a paradox. This governance creates a needless metalayer of friction and complexity. However, while Bitcoin is a standard, its decentralized nature means that it has no formal structure.  That said, Bitcoin utilizes a BIP or Bitcoin Improvement Proposal as the de facto way of introducing features (via Github). 

In fact, BIP 123, or “BIP Classification” created by Bitcoin Core Developer Eric Lombrozo explains that:

“Bitcoin is a system involving a number of different standards. Some standards are absolute requirements for interoperability while others can be considered optional, giving implementors a choice of whether to support them. In order to have a BIP process which more closely reflects the interoperability requirements, it is necessary to categorize BIPs. …” 

A Chip Off the Old Blockchain?

Bitcoin is no stranger to ISO or standardization for that matter. Back in 2014, Jon Matonis, then the executive director of the Bitcoin Foundation, penned an article for CoinDesk “Why Bitcoin Needs an ISO-Certified Currency Code.” The Bitcoin Foundation for its part was founded with standardization in its vision.  According to its words at the time, “[The]Bitcoin Foundation standardizes, protects and promotes the use of Bitcoin cryptographic money for the benefit of users worldwide.”  

Bitcoin Magazine spoke with Manu Sporny, chairman of the W3C Web Payments Community Group and CEO of Digital Bazaar. The W3C or The World Wide Web Consortium is the international standards organization for the World Wide Web. When calling Bitcoin a standard Sporny said:

“It depends on if you are talking about ‘de jure’ standards or ‘de facto’ standards. Bitcoin could be argued to be a ‘de facto’ standard, but even that argument is a bit weak since systems like Ethereum exist. When you have a standard, you’re looking for true interoperability. That is, multiple companies can follow the standard and come up with systems that interoperate. The Web is a good example of a set of interoperable standards. Bitcoin hasn’t hit that point yet, as much of the control over the core of Bitcoin is in the hands of very few developers and one major reference implementation. I think it’s shaky to call Bitcoin a standard. It’s a really interesting experiment.”

Meanwhile, Sporny notes that W3C has a Blockchain standardization workshop, Blockchains and the Web: A W3C Workshop on Distributed Ledgers on the Web scheduled on June 29–30 at MIT Media Lab.  

Down Under

The Australian proposal mentions leveraging pre-existing standards such as SWIFT ISO 20022 which “defines the fields and controls within messages and transaction between entities thus allowing interoperability.” However, this was on the heels of Reuters’ news story that hackers compromised the SWIFT software of Bangladesh Bank. 

While Standards Australia notes that, “The work will exclude legal obligations and regulatory matters addressed by government jurisdictions,”it also proposes to “Embed compliance to money laundering and Know Your Customer (KYC) requirements.”

Stakeholders

The proposal is just one of many blockchain land grabs by legacy actors trying to stay relevant in a world of Bitcoin governance. This proposal aims to “position ISO as a leading contributor to develop global solutions to facilitate data movement and information flows thus enabling more efficient and timely transactions” by establishing blockchain standards.

According to Standards Australia it is consulting with stakeholders on this proposal and intends to spearhead the ISO work if approved. For more information or to make a submission, contact Varant Meguerditchian ([email protected]) by June 19.

ANSI asks that comments are submitted to Steve Cornish ([email protected]), ANSI senior director of international policy, by June 3. Based on this feedback, the ANSI ISO Council will determine ANSI’s position, and comments should be submitted to ISO before its July 14 voting deadline. 

Editor’s Note: This is an opinion piece by Brian Cohen and the opinions represented are those of the author.

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