The future of insurance is blockchain

Let's figure out how blockchain technology can benefit insurance policyholders and buyers
08 November 2017   6608

Blockchain was mentioned firstly in 2008 when a anonymous developer named Satoshi Nakamoto published a whitepaper titled ‘Bitcoin: A Peer-to-Peer Electronic Cash System’ in which he described in detail how financial transactions can be conducted using an online peer-to-peer network without the need for financial middleman. In January 2009, the idea set out in the whitepaper became a reality, the blockchain was born and the first bitcoin transaction was conducted.

The blockchain is a distributed digital ledger that records data in a list of blocks that are linked and secured through the use of cryptography. Due to the decentralized nature of the blockchain network and its use of advanced cryptography, data that is recorded, stored and transferred on the blockchain cannot be tampered with, destroyed or reversed. This makes the bitcoin network one of the most secure financial payment networks in the world.

Another advantage of blockchain is its open-source nature. It allows to modify it easily in order to use blockchain in much wider range of use cases, beyond financial transactions.

Blockchain technology can be used to

  • create immutable digital identities,
  • securely store sensitive business data,
  • record proof of asset ownership,
  • store healthcare records,
  • to digitize documents,
  • and much more.

Nowadays, blockchain is widely used in these industries:

  • banking,
  • trade finance,
  • cybersecurity,
  • cloud computing,
  • real estate,
  • healthcare, 
  • charitable giving sector.

One area that is yet to experience blockchain disruption, however, is the life insurance sector.

This is what fidentiaX is going to change.

Tradable Life Insurance Policies and the Blockchain

fidentiaX is a Singapore-based fintech startup that aims to use blockchain technology to change the life insurance sector by building the world’s first marketplace for tradable life insurance policies.

What is tradable life insurance policies? They are insurance policies that can be sold to third-party buyers and can include endowment, whole life, universal life, and investment-linked, among others.

It is worth noting that most life insurance policyholders are not aware that their policies may be sold onto third-party buyers in the tradable insurance policy market. In the case that a life insurance policyholder no longer requires his or her policy, they would normally surrender their policy back to the insurer they bought it from in exchange for the policy’s cash value.

Currently, the market for tradable life insurance policies is complex, difficult to access and involves several intermediates. Through the implementation of blockchain technology in this space, however, all that can be changed.

fidentiaX aims to build a marketplace that uses the blockchain to tokenize life insurance policies so that they can become easily tradable financial products that anyone can buy to hold in their investment portfolio. The tokenization process will involve thorough due diligence on all life insurance policy documents before digitizing them and recording them onto the marketplace’s distributed ledger. This will also allow policyholders to have an immutable record of their policies, receive premium payment alerts, and have easy access to their coverage summary. A multi-signature access to the policy for beneficiaries and trustees will also be available on the platform in the case of a mortality event of the policyholder.   

Additionally, building a blockchain marketplace will allow buyers and sellers to transact in a transparent, secure and trustless manner as all actions are recorded on the blockchain for all involved permitted participants to view and audit. Blockchain also alleviates the need for intermediaries, which particularly play a role when to comes to mortality events and the subsequent processing of a life insurance payout.

Also, in a blockchain-based marketplace, payouts as well as premium payments can be conducted directly between the involved parties at a lower cost and at a much higher speed than with the current status quo of the industry.

Insurance policyholders can benefit greatly from fidentiaX’s blockchain-based insurance policy platform due to the fact that it makes the process of managing one’s insurance policy much easier and, above all, provides a liquid alternative to surrendering one’s policy in case it is no longer needed.

Insurance policy buyers, on the other hand, also play a big role in this new blockchain-powered approach to the tradable insurance policy market. For buyers, it has so far been difficult to access a market that provides stable diversified returns with low correlation to traditional asset classes. The current tradable insurance market is paper document-heavy, creates a challenge in sourcing tradable policies, is highly illiquid, and suffers from not having an easy-to-access marketplace where all market participants can come together.

This is why fidentiaX will be very welcomed among those who are looking to diversify their portfolios with tradable life insurance policies. By building the world’s first tradable life insurance policy market on top of blockchain technology, buyers gain access to a listing of tradable policies and can easily find other buyers and sellers willing to transact with them. Furthermore, through the transparent and immutable aspect of the platform’s underlying technology, trading can be conducted in a secure, trustless and easily auditable environment.

fidentiaX and the Nxt Blockchain

fidentiaX has decided to build its platform as a heavily customized version of the Nxt blockchain in partnership with blockchain development company Blockchain Zoo.

The Nxt blockchain is an open source distributed ledger platform that has been built on the functionalities of early pioneering cryptocurrencies. The Nxt network has a wide range of core features such as:  

  • decentralized asset exchange,
  • voting system,
  • marketplace,
  • native digital currency.

However, applications of the Nxt blockchain go beyond these functionalities and include secure messaging, account control, data storage in the cloud, monetary systems, and more.

Many of these functionalities will be adopted by the fidentiaX blockchain platform to provide a wide-reaching marketplace that caters to all participants of the tradable life insurance policies market.

Learn more

If you are intersted, you can learn more at

  • Official website
  • Tokensale
  • Telegram group

Potentional Vulnerabilities Found in ETH 2.0

Least Authority have found potentional security issues in the network P2P interaction and block proposal system
26 March 2020   979

Technology security firm Least Authority, at the request of the Ethereum Foundation, conducted an audit of the Ethereum 2.0 specifications and identified several potential vulnerabilities at once.

Least Authority said that developers need to solve problems with vulnerabilities in the network layer of peer-to-peer (P2P) interaction, as well as in the block proposal system. At the same time, the auditor noted that the specifications are "very well thought out and competent."

However, at the moment there is no large ecosystem based on PoS and using sharding in the world, so it is impossible to accurately assess the prospects for system stability.
Also, information security experts emphasized that the specifications did not pay enough attention to the description of the P2P network level and the system of records about Ethereum nodes. Vulnerability risks are also observed in the block proposal system and the messaging system between nodes.

Experts said that in the blockchains running on PoS, the choice of a new block is simple and no one can predict who will get the new block. In PoS systems, it is the block proposal system that decides whose block will fall into the blockchain, and this leads to the risk of data leakage. To solve the problem, auditors suggested using the mechanism of "Single Secret Leader Election" (SSLE).

As for the peer-to-peer exchange system, there is a danger of spam. There is no centralized node in the system that would evaluate the actions of other nodes, so a “malicious" node can spam the entire network with various messages without any special punishment. The solution to this problem may be to use special protocols for exchanging messages between nodes.