Bitcoin is a widely successful implementation of digital currency. As of February 2016, the total value of all bitcoins in circulation exceeds 6 billion US dollars, with millions of dollars worth of bitcoins exchanged daily. It is accepted by such reputable merchants as PayPal, Expedia, and many others. The basic technological principles behind Bitcoin have been adopted by Microsoft and IBM in their financial products and offerings.
What makes Bitcoin unique is that the implementation is entirely distributed, without any centralized authority that would inject the money or issue digital certificates. In a nutshell, it is based on a secure mechanism for distributed transactions in a decentralized P2P network. Information about transactions is stored in a transactional ledger, which is globally replicated across all the nodes in the system. The P2P network helps to protect the ledger against tampering, as long as no adversary can gain control over a majority of the nodes.
This unique distributed solution that does not require centralized authority has facilitated a vision of new applications based on similar principles. Bitcoin has facilitated crowdfunding, which is a form of alternative financing that allows funding a project or venture by raising monetary contributions from a large number of people. In particular, Bitcoin has been used to crowdfund Greenpeace, the Mozilla Foundation, the Wikimedia Foundation, and WikiLeaks. Furthermore, there are promising efforts towards a globally accepted certificate verification system. Recently, some universities have begun experiments issuing degree certificates that are recorded in the publicly available transaction ledger.
Main objective and summary:
Extend the functionality of the existing Bitcoin infrastructure, scale it up, and design new applications that provide certified transactions without centralized authority. The scope of this objective encompasses multiple master thesis projects, each focusing on a single aspect.
Scientific challenges:
- How to reuse the same infrastructure for applications with different semantics and consistency requirements? How to scale the infrastructure with the number of different applications?
- As the rate of transaction ever increases, how can we scale both processing and storage of transactions?
- Can we reduce energy consumption by Bitcoin or propose innovative Bitcoin-enabled consumer-oriented energy services?
- How can we improve mechanisms for construction and maintenance of the P2P network as well as communication protocols exploiting it?
- The current Bitcoin implementation does not focus on confidentiality or privacy of participants. Improving identity protection is an open problem.
References:
https://azure.microsoft.com/en-us/blog/ethereum-blockchain-as-a-service-now-on-azure/
http://www.coindesk.com/ibm-goes-big-on-blockchain-unveiling-ambitious-new-service-offerings-and-strategy/
http://www.coindesk.com/university-nicosia-issues-block-chain-verified-certificates/