Around one year ago they featured in new reports basically every day: blockchain & crypto currencies. People were introduced to bitcoin, while also discovering that there were hundreds of other crypto currencies out there. We all know what has happened in the past year: many people (who often got on board without any knowledge to ensure they did not miss the boat) have had to take their losses or are hoping for better times.
Personally, I’ve never really been enthusiastic about the crypto currencies, but I am very interested in the underlying technology: blockchain. So when I was asked to participate in the design sprint to explore how blockchain could be used to protect the intellectual property rights of photographers, I was keen to get involved. It is now six months later and we have delivered our first project that uses blockchain technology: https://www.picapro.nl
PicaPro is an online application for photographers to easily draw up and pay for licences in which they set out agreements they have made with their customers. As soon as the payment has been made, (a hash of) the licence and the associated (hashes of the) photographs are saved in a private blockchain. Once something has been saved in a blockchain, it can no longer be changed and, consequently, the agreements concluded are recorded incontestably.
This information prompts blockchain experts to say dismissively: “A private blockchain? That’s not a real blockchain.” We have indeed chosen (for the time being) a private ethereum blockchain. We did this for two reasons; first of all owing to the costs. Some licences contain dozens, hundreds or even thousands of photographs. If we save the hash of all those pictures on the (main ethereum) blockchain, the associated transaction costs will be a reason for users not to use the application.
Legislation, and particularly the General Data Protection Regulation (GDPR), is the second reason why we have opted for a private blockchain. Everyone has the right to be forgotten, but a blockchain never forgets and we are storing personal data after all. With the private blockchain, we have a ‘panic button’ that allows us to delete data, something which just isn’t possible in the main ethereum blockchain.
However, I do really wonder why a photographer would want the fact to be forgotten that he or she has made agreements with a client about the use of a particular photograph. After all, this information can only be used to protect the rights of this photographer. I believe that the GDPR currently renders many socially useful applications of blockchain impossible. This is because blockchain is not only an excellent way to record intellectual property rights, but it can be used for other registrations of property. We already register other property rights in other registers, such as immovable property in the Land Registry and car ownership via the RDW (National Vehicle and Driving Licence Registration Authority). One of the uses of these registers lies in the fight against crime. In any event, I am yet to hear of someone whose house has been stolen. However, this involves a lot of hassle since you need to go to a civil-law notary, for example. The costs of these registers are also so high that we are unable to use them for less valuable assets. A blockchain, on the other hand, can be simply configured as a public register in which property rights can be saved in a user-friendly manner and at very low cost.
In my free time, I enjoy hopping on a racing bike and, unfortunately, I have had one stolen in the past. This is why I would like to explain further the idea of a public register for saving property rights using the example of bicycles. Imagine, a manufacturer provides a bicycle with a serial number and records this in a blockchain. As soon as a dealer purchases this bicycle, the manufacturer transfers the ownership of this bicycle to the dealer via the blockchain. The dealer does the same when he sells the bicycle. Now imagine that you want to sell a second-hand bicycle. Using the serial number, you can easily check via an app or website whether the person selling you a bicycle is indeed the owner of the bicycle. Following the sale, the owner can easily transfer ownership to you. This seems to me an effective weapon in the fight against theft and the handling of stolen goods (as it would now be simple to demonstrate that someone purchased a stolen bicycle that he could have known was stolen).
However, I don’t simply want to ignore the privacy issue. Of course, the idea that just anyone can look up the ownership of a particular bicycle is not a very appealing one. However, there is a solution to this. It is possible to design a blockchain in such a way that only the owner is able to demonstrate that the bicycle belongs to him. With a blockchain like this, the blockchain can only answer ‘yes’ or ‘no’ and the only question you can ask is: Does this bicycle belong to me?
But this type of hypothetical blockchain remains subject to what is known as pseudonymisation; pseudonymisation that is reversible. I’m not a legal expert, but judging from everything I have read thus far I believe that the right to be forgotten applies here. Consequently, the legal applications of a public blockchain remain very limited, at least within the EU. Nevertheless, the use of private blockchains, like PicaPro, is possible. It may be possible to scale this up in the future to a public blockchain for saving transparent, incontestable and accessible agreements.