Proof of Authority: a next-generation foundational distributed ledger platform for institutional communication, authorisation and consensus

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Benefits come from working together, but trust boundaries prevent individuals andorganisations from dealing freely with each other, because of the high risk that interests arenot aligned. In order to engage for social or economic gain, actors must cross these trustboundaries. Presently this requires trusted intermediaries: HSBC, eBay, AirBnB, or thegovernment of the UK. Intermediation is viable only through network effects. As such, trustbecomes a scarce resource– expensive to obtain and yet easy to abuse.Costs come down to verification, reporting, auditing, and external relations; all primarilymanual tasks. Digitisation has changed business profoundly, from traditional industries suchas banking to new sectors like IoT; however, trust is still a manual, human-intensive activitywhich comes at incredibly high costs. Industry experts estimate that banks alone spend up to80% of their operational cost on trust-related tasks, e.g. post-transaction verification due to thelack of suitable transaction platforms.New decentralised blockchain technology has the potential to become the core of a newconcept: a universal machine that commoditises trust. Under this grant, we will develop adeployable PoC of a trust-machine platform, based on our Proof-of-Authority (PoA)blockchain technology, which can be operated by a flexible plurality of self-chosenindependent parties who are empowered to collaborate “trustlessly”.The Ethcore team have been at the forefront of technological development as part of theEthereum project (in 2014 the second most successful crowdfunded campaign), which wasnotably mentioned most recently in the UK government report on blockchain technology aswell as featured by the Economist. This grant will support the development of our PoAdistributed ledger system – a foundational building block for next-generation secure multipartytransactional systems for financial institutions, government and enterprise.