Spam mail is a downside of the Internet that we have come to accept. Nobody likes it and web-based mail hosts like Hotmail developed spam folders to siphon off the rubbish from the ‘real’ communications. It’s a flawed system, but it does reduce the problem of having your inbox filled with offers of every dubious kind. Less easy to handle is the cold callers who want to sell you something, usually some kind of financial product these days.

For blockchain watchers the announcement that the Telecom Regulatory Authority of India (Trai) is planning to use blockchain to prevent unsolicited telemarketing communications is an interesting one.

The report in the Business Standard says that Trai is turning to the blockchain after years of being unable to control this type of call, because by using the new decentralised technology it will be possible to track spammers very speedily through data matching even when they use normal 10-digit phone numbers. To date, 230 million subscribers have reportedly registered for Trai’s “Do Not Disturb” registry, which came into effect in 2010, but the registry has so far failed to crack down on telemarketers.

India has a large population and Trai estimates that “some 30 billion commercial messages are sent out every month, of which many may be unsolicited, making telemarketing a brisk business opportunity.” To date, it has proved very difficult to track the spammers as they have been using the 10-digit mobile number and not the special numbering series allotted for telemarketing. Trai says that a blockchain-enabled digital record will show the entire communication between the various entities, and thus make them traceable.

The blockchain-based rules will record all communication between subscribers and entities, with the most important element being “capturing customer consent for information and authorised telemarketing agencies.” Currently Trai is debating the draft regulations and trying to decide how explicit consent should be given with regard to unsolicited commercial communication. The organisation also believes that the consent should be reviewed periodically.

Trai Chairman RS Sharma stated that Trai is “probably the first organisation” to implement blockchain as a RegTech(regulatory technology) “on such a large scale.”

In light of the recent General Data Protection Regulation (GDPR) that came into effect in Europe last week, it will be interesting to see how storing personal data on the blockchain interacts with the GDPR regulations. Perhaps we will learn something from Trai’s use of blockchain for its Telecom Commercial Communications Customer Preference Regulations 2018.

 

The hype around the blockchain suggests that it can do anything you want it to; that it’s like magic dust that will save the world. Is it as fantastic as the blockchain messiahs claim it is, or does it actually have some limitations?

What is the blockchain?

It’s a series of linked blocked and each block is composed of a series of transactions. Think of a train where you have a series of carriages that are coupled together, or any item that has units linked together.

In the case of the blockchain, the transactions there are specific rules about how you input the data about the transactions (consistency), you can’t overwrite data that is already inputted (immutable) and each transaction has an identifiable owner. Added to this, there is a consensus about what is in each block without the need for a central party controlling it (decentralisation).

Decentralisaton is the perceived ‘magic’ of the blockchain, because this factor guarantees that there is “no single point of failure.” In other words, nobody can mess with your transaction on the blockchain. You also don’t have to trust a central body; hence it is called ‘trustless’. This is the element that gets everyone most enthusiastic.

What’s the downside of the blockchain?

Creating the system described above is not so easy. Building in consistency and preventing bugs corrupting the data is a real challenge and one that needs to be taken slowly, because if you don’t, the chances are you will lose consistency and then the blockchain is worthless.

Think of it this way: if you have a centralised database and something goes wrong, you fix it by starting over. But, you can’t do that with a decentralised system. And the reason for that is, you need consensus, or the agreement of all players in the system, in order to change the database. The blockchain is a public source with no central ownership. That is its big claim to fame, but also one of its weak links.

When it comes down to it, decentralised systems are very difficult to work with, expensive to maintain, hard to upgrade and a pain to scale. It would be much easier to stick with a centralised system, but where’s the ‘brave new world’ feeling in that?

What’s the upside of the blockchain?

In a nutshell, it removes a single point of failure or control. It is answering problems in sectors where IT infrastructure is outdated, such as healthcare, logistics and financial services. For many blockchain believers, the main appeal was that it would remove government control and prove to be a liberation movement, but as we’ve seen in the last few months, it is extremely hard to bypass governments and their regulatory bodies.

It is also proving hard to scale the blockchain for sectors where that is needed; money being the exception. As Jimmy Song writes in Medium: “Immutability and difficulty in changing the rules is a positive for money and not a detriment. This is why blockchain is the right tool for the job when it comes to Bitcoin.”

But, for other business sectors with specific IT requirements, it is not the case that a blockchain solution will cure all your ills, but that is how the blockchain is being sold. Being wary doesn’t necessarily mean that you need to turn your back on the blockchain completely, it just means “Caveat emptor” (let the buyer beware) as the Romans used to say.