There’s a lot of buzz around blockchain of late, following on the heels of hubbub around the crypto-currency bitcoin. But it’s all just the tipping point for what distributed consensus might do for enterprise IT.
At the Cloud Identity Summit in New Orleans this week, Ping Identity announced its seed investment in distributed consensus platform Swirlds, which has emerged from stealth mode to harness the power of the cloud without servers and to solve the limitations of Blockchain.
For all of hype around blockchain, said Ping Identity’s senior director of labs Mance Harmon, it’s lacking attributes that would make it truly trustworthy for enterprise-grade applications. “Blockchain is certainly at the top at the hype curve,” he said. “What’s important is distributed consensus generally. Blockchain is just the first modern instance of it.”
While distributed consensus networks such as Blockchain have gained recognition for the ability to create trust within peer-to-peer networks and led to the Bitcoin payment system that facilitates transactions through distributed trust, it’s still inefficient, he said.
Blockchain’s distributed consensus algorithm can generate distributed trust, but if the members of the blockchain community are untrusted, then a proof-of-work mechanism is often required to ensure the community comes to consensus. Harmon said this can introduce high lag time and wastes resources. In addition, blockchain doesn’t provide trusted timestamps nor proof of receipt.
He said the Swirlds distributed consensus platform has a huge advantage for existing systems such as blockchain, so Ping Identity is leveraging it to created a new standard for distributed session management (DSM) so it can be applied by identity providers and cloud applications. Swirlds hashgraph three important properties that blockchain, central servers, or leader-based systems don’t have, said Harmon: fairness, distributed trust, and resilience to Denial of Service (DoS) attacks, without the need for inefficient proof of work. “Ideally you want to find a different approach to enable the community to come to consensus without the requirement of proof of work.”
The Swirlds hashtag weaves blocks of data together so that none are ever throw away and don’t require a community of miners that take time to come to an agreement, who collect transactions and can potentially put them in any order or leave them out. This approach is adequate for a cryptocurrency such as Bitcoin, but insufficient for a stock market or online auction because it matters who is first. “Blockchain is not there,” said Harmon.
When applied to identity management, the Ping DSM system built on the Swirlds hashgraph platform reduces risk by giving IT organizations a “kill switch” for identity authentication in instances of employee terminations and lost or stolen devices. The standard enables global session logout for all active Single Sign-On and Application Sessions across both web and mobile apps, independent of the identity protocol being used. It also generates a cryptographic timestamp and proof of receipt, providing the assurance and certainty that session commands are received and when they were received. “You have to have a kill switch,” said Harmon. “Distributed consensus will be proposed as a standard to enable that capability.”
What Ping Identity is doing with Swirlds is just one application of the platform, said Dr. Leemon Baird, founder and CEO of Swirlds. He said potential applications for the Swirlds hashgraph expand far beyond the financial industry to supply chain logistics, social collaboration and multiplayer gaming.
Distributed consensus is still early in the process of four key stages of evolution, said Baird. Bitcoin was the start of being able to establish distributed trust, followed by the idea of a permanent ledger, which is the digital equivalent of being written in stone. “You have distributed ledger records for posterity every time you spend a coin, which is a really useful thing.”
Baird said the third step would be to do the transactions themselves and enforce rules – a stage that hasn’t been reached yet. From there, you can run a system such as the stock market or eBay without a central server. Blockchain would be insufficient because it matters who is first, something it can’t verify, but Swirlds hashgraph can. It’s also more scalable than Blockchain.
Ultimately, the concept of distributed trust is next level of the Internet, he said, and in the immediate future the financial industry has a lot to gain from a faster distributed consensus technology. Currently, said Baird, it takes days for a trade to clear between two different banks. “That’s insane in the age of computers.”