Fourth generation identity-based blockchain targets CBDC implementation issues

A new project calling itself the first of the fourth generation blockchains says it has solved the “blockchain trilemma” with a new approach to decentralization and an identity-based approach to security.

The MetaMUI Blockchain is a “self-sovereign, identity-based meta blockchain” Seokgu (Phantom) Yun, founder and CEO of Sovereign Wallet Network (SWN) told a live ask-me-anything session held on Cointelegraph’s YouTube channel. “MetaMUI Network is the permissioned public blockchain SovereignWallet Network is building with central banks, commercial banks, financial institutions, and other blockchain companies around the world.”

The blockchain trilemma, posited by Ethereum creator Vitalik Buterin, is that full decentralization, scalability, and security require trade-offs, so they cannot all be achieved at the same time.

“To solve this trilemma, we need to understand the very fundamental nature of the blockchain itself,” Yun said. “Many believe that blockchain is decentralized, but actually it is not. Blockchain didn’t eliminate the middleman, it introduced multiple middlemen and requires their consensus to transfer cash — it is structurally decentralized, but from an operational point of view it is very centralized and serialized. Every node is one single virtual node that can only process transactions one by one.”

Think of someone buying a coffee in one store, but people in other stores have to wait for that transaction to be finished before each in turn can buy their own coffee, he explains.

MetaMUI blockchain, in contrast, allows direct peer-to-peer transactions without requiring consensus of nodes or reference to a centralized server database. The system lets blockchains generate new blockchains and create virtual blockchains within blockchains. That means it can achieve essentially unlimited scalability by adding more nodes, Yun said. Under ideal conditions, it should be able to handle a staggering one million transactions per second.

The privacy gap

At the heart of MetaMUI is a self-sovereign identity mechanism that “binds ownership of the asset to the identity of the user,” replacing the private keys pioneered by Bitcoin creator Satoshi Nakamoto, Yun said. Nor does MetaMUI have public keys viewable by anyone, with transaction data using zero-knowledge proof (ZKP) encryption.

The problem with private keys, Yun said, is not just that losing them essentially destroys the asset, but also that they are “directly against the regulatory framework of the conventional banking system,” which “hinders the wide adoption of blockchain by the financial system.”

More insights from SovereignWallet Network Global here

MetaMUI’s GDPR-compliant, identity-based blockchain bridges that gap without revealing users’ identities or storing that information anywhere on the blockchain, he said. At the same time, it means the end of lost private keys translating to the loss of the asset, as with “proper identity verification and court order” MetaMUI Network would be able to restore that access, he said.

This makes it a platform designed for central bank digital currencies, privately-run stablecoins like Tether and USD coin, and internal stablecoins published by banks, like JPM Coin, he added.

Calling MetaMUI Network “a CBDC platform service provider,” Yun said it allows digital asset creators to launch them while retaining full control.

Looking ahead

By making the system reliant on fees paid to the provider rather than consensus validators, he said MetaMUI offers a better and more reliable financial model for supporting blockchains long-term. He points to the cost of maintaining the enormous amounts of data generated by the huge number of small transactions that would be racked up by a CBDC. That same logic applies to NFTs, he added.

SWN Global’s partners include the Official Monetary and Financial Institutions Forum (OMFIF), Digital Monetary Institute (DMI), and Nordic Blockchain Association, among others. The company’s roadmap includes expanding the number of exchanges listing the MetaMUI coin, running cross-border CBDC pilots, and completion of the MetaMUI mainnet and all its features.

Learn more about SovereignWallet Network

Disclaimer. Cointelegraph does not endorse any content or product on this page. While we aim at providing you all important information that we could obtain, readers should do their own research before taking any actions related to the company and carry full responsibility for their decisions, nor can this article be considered as investment advice.

Sourced from cointelegraph.com.

Written by Connor Sephton on 2021-06-28 10:34:25.

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