World Largest Bank to File Blockchain Patent

Industrial and Commercial Bank of China filed a patent for a blockchain system for the exchange of financial assets
10 July 2018   1029

The Chinese bank Industrial and Commercial Bank of China (ICBC) - one of the largest commercial banks in China owned by the country's authorities and the world's largest in terms of total assets - is trying to patent a blockchain system for the exchange of financial assets. This is reported by CoinDesk.

According to the patent application filed by the bank, this system is a platform whose members can function as nodes and form a distributed network.

When a user from one institution initiates a transaction request, a smart contract is launched, which forces each node to check the transaction based on the data provided - including the balance of the sender's account, its name and the amount of the transaction. The transaction will be considered complete when the network receives messages about the successful passing of the verification from each participating node, and therefore - overcomes the predetermined threshold of consensus.

The essence of this technology, according to the application, is to eliminate the intermediaries available in the existing system and improve the liquidity of financial assets.

In the patent application, ICBC claims that the research in this direction began because of the problems that arise in the existing system in the implementation of interbank and cross-border transactions - whether it is ordinary payments or the transfer of financial instruments like precious metals or futures.

The traditional transaction chain that is built around a centralized credibility system incurs problems like the high cost, low efficiency, low stability, as well as inflexibility. This impedes the bank's launch-to-market process to meet the rapidly growing demand for innovative financial products.
 

ICBC Filing

ICBC is filing a patent application for blockchain not the first time. Previously, the bank was trying to patent a blockchain that can verify the data of users using a distributed network.

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   964

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.