Large Philippines` Bank to adopt Ethereum with ConsenSys

UnionBank placed in the Philippines is cooperating with US-based company  ConsenSys to assist local establishments in implementing Ethereum and blockchain
27 May 2018   1813

The Philippines has a unique financial infrastructure, and the banks are aware that only the upper class and high net-worth individuals can afford banking services. The main reason behind the difficulty of acquiring bank accounts and services in the Philippines is the base balance required by financial institutions. UnionBank, for instance, requires users to store more than $2,000 as default balance, and the failure to maintain a balance of over $2,000 could result in penalties. In a heavily Remittance-concentrated country like the Philippines, any technology that could provide transparency, security, robustness, and efficiency in processing transactions is crucial. 

ConsenSys and UnionBank concider that the blockchain could be the way that may cardinally improve the present financial infrastructure and ecosystem of the Philippines. Justo Ortiz, the chairman of UnionBank, affirm that the blockchain can  “crack the hole of financial inclusivity,” if accepted and commercialized suitably.

In the upcoming months, ConsenSys and UnionBank will cooperate to utilize Kaleido, an enterprise blockchain solution ran on top of the Ethereum blockchain protocol, to manage information and transactions more safely and transparently.

Our appetite for experimentation is warming the country up for significant transformational change for the next generations to come.
Alai Garcia
ConsenSys Solutions Lead, Asia Pacific

Ethereum founder Vitalik Buterin declared that the cost of processing information on the blockchain is essentially higher than centralized systems like Amazon Web Servers.

Blockchains by themselves are a far less efficient computer and database than technology that has existed for 40 years. If you want to talk about what blockchains are for, the answer is not simple raw efficiency. If you look at Amazon EC2 pricing, the cost of this is about $0.04 per hour. How much does it cost to make the Ethereum world computer to do stuff for you? Every Ethereum block, which comes every 14 seconds, on average takes about 200 milliseconds for my laptop seconds to process. A block has a million gas and let’s assume the average gas price of 4 GWEI. The cost of filling up an Ethereum block is $13.4 per 200 milliseconds. 
Vitalik Buterin
Founder, Ethereum

Hence, UnionBank and other banks in the Philippines that are utilizing the blockchain to act transactions have to take into consideration that blockchain technology isn’t necessarily the most rational technology to manage information. A proper solution  would have to be chosen to justify the overhead and possible cost of using the blockchain via centralized systems.

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   1039

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.