A research project that aims to start an online community of 50,000 internet users to evaluate the principles of an ‘internet of trust’ in an interdisciplinary project that uses computer science, economy and legal knowledge has received a grant of €3.3 million. Of the total amount, €1.5 million comes from the Dutch Research Council (NWO). The funding will allow associate professor of finance Dr Dion Bongaerts from Rotterdam School of Management (RSM) to be part of the Sovereignty4Europe project to design an internet-based system that records various forms of transactions in a reliable and law-compliant way.
The project is financed by Holland High Tech Top Sector HTSM, NOW, and the Delft Blockchain Lab at TU Delft. It ties into to the Dutch Blockchain Research Agenda in the Faculty of Law at the University of Amsterdamas well as the Fintech research agenda at the Erasmus Centre for Data Analytics. Their proposal Sovereignty4Europe describes a system that uses a blockchain that allows anyone to assess their level of trust in a person or company.
The importance of trust
Dr Bongaerts explains: “Trust is a crucial lubricant of economic and social interactions. It allows us to trade with others, buy durable goods such as cars, and to co-operate on joint and long-term projects ranging from entrepreneurial start-ups to marriages. Trust in the commercial space evolved from merchants in the 17th century into brand recognition in the industrial age; it allows reputable brands to charge premium prices. But now, anonymity provided by the internet age and the centralisation of data-based trust services by internet giants such as Google, Facebook, and Amazon call for technology-enabled trust as a baseline factor for the internet – this is the basic premise of our project.”
Alternative to internet giants
Project leader is Dr Johan Pouwelse, associate professor at TU Delft: “Our aim is to be a catalyst of change by proving that there is an alternative and reliable approach to provide the services offered by some of the largest companies in the world. Our ambition level is to disrupt the US-dominated central platforms by offering a non-profit alternative with trustworthiness, fairness, security, and privacy. To this end, we will design and deploy a system for a trustworthy blockchain economy. For maximum impact, we will release open-source versions of the software upon completion and validation.’
Blockchain to create trust
Historical records are an important source of trust, and the researchers say that their mechanisms for recording transactions in an irrefutable way will:
- create an internet-based, trustworthy economy
- uniquely identify the parties involved in a transaction
- derive trust levels from past transactions.
The system uses blockchain technology as a building block with the goal of designing and investigating these mechanisms and will include the design of an online economy with 50,000 internet users.
National Office for Identity Data
In addition to the three universities in the project, the Dutch National Office for Identity Data (RvIG) is also actively involved. This branch of the Ministry of the Interior and Kingdom Relations will contribute to an open ecosystem in which societal interests like privacy and security can be met, as well as economic needs such as a greater trust in digital transactions, better cost efficiency, and the development of new services.
According to the European Commission (EC), blockchain technology may bring great benefits for European citizens and businesses. The EC has stated that this technology will enable “new distributed business and interaction models based on direct peer-to-peer exchanges without the need for centralised platforms or intermediaries”. The EC is investigating the opportunity and feasibility of an EU Blockchain Infrastructure for the advent of an open, innovative, trustworthy, transparent, and EU-law compliant data and transactional environment. The Sovereignty4Europe project organised by TU Delft, RSM, and UvA, will develop the fundamental knowledge to realise these grand ambitions.