Bitmark + IFTTT: How to take ownership of your digital life and plan your estate.

What would happen to your personal data and digital assets if something happened to you?

The process of preparing for the transfer of assets after death is known as estate planning. Estate, a common law term, means an individual’s property, entitlements, and obligations. In modern society, legal systems have elegant solutions for handling the assets that we accumulate and create in the physical world. But increasingly the stuff we create and value most exists only in our digital lives, where there’s no system for individual ownership. In the digital environment estate planning is a minefield.

Individual humans create value by living their lives online — producing works of art, sharing ideas and opinions, uploading personal financial and health information, or buying and storing things like music and movies.

But we don’t own our stuff on the internet. We give it away for free, and, in the process, we’re losing our ability to plan for our future.

The Bitmark mission is to empower universal digital ownership, and we’re making simple tools that help you gain freedom and control of your most valuable data within the digital environment. If we could own our digital lives just like we own everything we buy and build in the physical world, wouldn’t this add to our wealth and freedom? We think so. To make digital estate planning more accessible and automated for everyone, Bitmark has partnered with IFTTT, an IoT service that gives users greater control of their personal data across a wide variety of apps and online services.

“We’re excited to have Bitmark as a partner. They’re a unique service, and doing something incredibly ambitious. Applets will help reach a broader audience that’s just beginning to think about digital data ownership and attribution.”
—Linden Tibbets, CEO of IFTTT

Start your digital estate in 5 minutes.

To get you going, we have an initial set of IFTTT Applets that interface with the digital environments where you create and share things: social media, fitness and health apps, productivity and financial software, and much more:

Bitmark IFTTT Applets

These Applets apply a mark of accepted ownership to your data and embed it into Bitmark’s standardized, universal digital property system. It’s an automated process that transforms your data into an asset that you own and pass down to loved ones.

We recommend you experiment with a few of these Applets first, and then decide which data and assets are most valuable to you. (If you’re lacking ideas, we published a blog post earlier this summer about what two of our Bitmark team members would choose.)

Here is how this process will look:

Step 1: Turn on some Applets and authorize IFTTT.

Once IFTTT is authorized, it automatically bitmarks your new property via the connected Applets. You can view your property in Bitmark’s app, where you can also issue new bitmarks for any other document type on your computer or phone:

Step 2: Check out your digital properties.

Next steps: Grant access to your estate (coming soon).

When property ownership is clear, the access and management rights to your estate, (known as fiduciary duty) is more easily worked out. These details will depend on local regulation, in the same manner as the things we own in the physical world.

Usually it requires a long, expensive, legal process for your loved ones to access your accounts — your emails, cloud storage, and digital data that’s in your name. Not to mention that, in many cases (read Twitter’s deceased user article, or Wiki article about Death and the Internet), your loved ones will never be allowed access to your accounts, and if they try, it will be a criminal offense. Ouch.

Bitmark for digital estate planning has two goals: 1) provide individuals with a structured, secure system for assigning ownership to your digital assets and data; 2) pave the way to a more free and fair legal framework for our digital lives and valuables.

Think of what we are providing today as a basic first step. Bitmark’s tools provide a framework and infrastructure to begin organizing and protecting your digital property. In the future we will add more options that make it easier to assign access to your digital estate with your lawyer, spouse, and loved ones.

“Bitmark’s work with IFTTT confirms and tracks ownership of online data, which is a significant step towards intentional management of any digital estate and future planning for incapacity and death.”
 — Megan L. Yip, Attorney, Estate planning and digital assets

Bitmark is empowering the individual to take back ownership.

Bitmark is the property system for the digital environment. As a system to manage digital property, Bitmark makes it possible to own and transfer title to anyone. For individuals, ownership is power. By establishing ownership to your data, you can in turn derive value from your digital property just as you do from the things you own in the physical world: selling, buying, transferring, donating, licensing, passing down, protecting, and much more.

This tool for digital estate planning is just one piece of our larger mission to empower universal digital ownership so we can live free online. Digital property will level the playing field for who can achieve success online — creating new avenues for wealth, prosperity, and achievement on the Internet that are not currently possible for the vast majority of people.

Read our “Defining Property in the Digital Realm: parts one, two, and three for a more in-depth context to this post.

If you would like to stay posted on future applications of Bitmark and how we are transforming the Internet into a new system built on individual freedom and empowerment, subscribe to our newsletter.

By Bitmark Inc. on July 18, 2017.

What’s in a property title?

Best practices for safely bitmarking your data & organizing your digital assets.

When I talk to people about Bitmark there is confusion about digital property. I think most of this confusion boils down to what exactly is in a property title (or in the digital realm, a “bitmark”), and what is in the asset itself.

A title is a public ownership claim over an asset. The asset itself can be made public or kept private — that’s totally up to the owner. Titles are always public. One function of the title is to uniquely identify that asset. (You can think of that like the address to your home on its deed or the vehicle ID number on your car title). But titles do more. Titles make property rights transferrable from one owner to another. That has massive value which we will explain later. In this article, I want to focus on clarifying what should and should not be in a digital title, thus how you should and shouldn’t bitmark your stuff. Let’s use an example to get started.

The other day, I read that location information is super valuable so I wanted to start an Applet bitmarking my location data:

The Applet automatically created the following digital property:

The property bitmark (title) represents rights to access my location data. This record is visible from the Registry. Thus, if I wanted to give or sell my location data (asset), I would not want that data embedded in the title itself. Yet that is what this Applet did. Inside the public metadata of the bitmark contains a link to my actual location:

Location is a data set that most people would think of as sensitive. I know I do. Putting sensitive data into the title is not what we want.

What should go in a title?

It is important that the title describes the asset, usually from an economic value perspective, without revealing potentially sensitive information about the asset itself.

Here are three examples to help clarify:

  1. Fitbit daily activity — Put things like date and device type, maybe a defining characteristic like age or gender (your preference) in the title. Everything else (step count, calories burned, food ate, sleep cycle, and heart information, …) should go in the asset itself. Folks who want the metadata for their research purposes, can ask your permission, you give consent and they get the full asset.
  2. Instagram photos — Similar to health data, you’ll want to name your photo title something that defines the asset like a caption. You can include the time, location, date or the bare minimum of information that makes it memorable and valuable. If the Bitmark property system becomes a sort of marketplace one day, a gallery buyer can potentially search relevant titles for something they want to highlight in their next show. The asset is the photo itself.
  3. Medium stories — Include sparse but important information about the piece, date, author, or title perhaps. The metadata is the story itself. By being bitmarked, we hope someday these titles will be checked or authenticated, so that when content is shared over messaging apps, the reader knows they are reading a verified source. Think similarly to the blue check box next to certain handles on Twitter.

Bitmark is the universal property ownership system for digital environment.

One of the most important functions a formal property system does is to transform assets from a less accessible state to a more accessible state, so that ownership can be easily communicated and assembled within a broader network. When an individual asserts ownership over their data control points change: networks become economies.

Converting an asset such as a house into an abstract concept such as a property right requires a complex system to record and organize the socially and economically useful attributes of ownership. The act of embodying an asset in a property title and recording it in a public ledger facilitates a consensus among actors as to how assets can be held, used, and exchanged.

Bitmark is about imagining a future where individual internet users will take back ownership of their digital lives — a new internet built on individual freedom and empowerment where everyone has a chance at success. This freedom stems from ownership of digital property just as we own everything we buy and build in the physical world.

If you’re interested in going deeper, one of the best features of the IFTTT platform is that you can create your own Applets, extending core functionality that the service provides. For anyone looking to extend our service here is a list of metadata options to consider:

Created (date), Contributor, Coverage, Creator, Description, Dimensions, Duration, Edition, Format, Identifier, Language, License, Medium, Publisher, Relation, Rights, Size, Source, Subject, Keywords, Type, Version, Other*

These options come from our web app and they work well for most personal data and digital assets. We recommend using them, but you can also create your own metadata. Just be clear on what will always be public (titles) and what can be kept private (assets). A good analogy to keep in mind is that the deed (title) to your home doesn’t reveal what’s inside your home, but it does explain where to find your home.

Join us in our efforts to democratize the digital economy. Sign up for our beta and try our IFTTT service. If you have any questions, we’re @BitmarkInc on Twitter.

By Bitmark Inc. on July 15, 2017.

Bitmark solves big problems in today’s data economy

Most people have a different view of their data than reality.

People far too often still believe they own their personal data and digital assets when they do not. In the current state of big data, big companies make money by tapping into the enormous amount of “free” information created by individual internet users, bundle it together and sell it to the highest bidder. And when this content and data is stolen there is seldom any liability assigned or fines paid.

Bitmark’s tools define a new digital freedom by providing an economic framework of standardized property rights, rules and infrastructure — just like the ways in which we own assets in the rest of our lives. The system will allow individuals to derive value from digital property just as we do from the things we own in the physical world — selling, buying, transferring, donating, licensing, passing down, protecting, and much more.

Ownership is power for individuals. In modern society, freedom and economic prosperity means property ownership and accumulation of wealth.

Data is the ultimate externality: everything we do in the digital environment generates it.

When we walk or drive around, our phones are generating activity, location, and sensor data, just to name a few. This data is fragmented and it often varies greatly between individuals. Developers of each app or device extract what data they need for their specific purpose and largely ignore the rest. Data is the oil of the digital economy, driving growth and change. It will be increasingly important that individuals have rights surrounding how the data they create is accessed, transferred, and ultimately owned. Your data should be very important to you, and right now, technically it’s immensely challenging to protect and transfer your data.

There are few open market exchanges of data because the costs associated with data transactions are so high. There are unclear data property rights, so negotiations between parties are complex. To put it another way, new opportunities and markets could arise if there were easier, more structured access to personal data along with clear property rights. Bitmark is building tools to help initiate this structure and new data ecosystem where the individual is at the center of opportunity.

At the core of this effort is our property system, blockchain-based tech that records and indexes who owns what data. For example, in our partnership with UC Berkeley participants donate their personal data to public health studies. In effect, they are transferring a bitmark to their data such that the rights to use the data are recorded as well. This consent, “chain of ownership,” protects both parties to transaction, not just legally but also technically. Once the ownership transfer is recorded in the blockchain, the data is encrypted for only the researcher to access:

An open exchange of data respecting property rights.

We believe this type of transaction, where two parties directly exchange valuable assets via the blockchain, is a prototype for future data markets. Returning power of ownership to individual people in their digital lives will level the playing field for who can achieve success online. It’s not a stretch to imagine individuals accepting offers from commercial buyers for their data. Rules could be set that automate this based on specific standards. When data can be authenticated, and tracked back to its origin, parties can be easily compensated. And equally important — bad economic actors can be held accountable for negligence. All of this can create new avenues for wealth, prosperity and achievement on the internet that is not currently possible for the vast majority of people.

When an individual asserts ownership over their data control points change: networks become economies.

Take a typical online transaction, such as the sale of an eBook (a digital asset). We can ask who is in control:

  • The reader “bought” a non-transferrable license to access an eBook under specific conditions (eg: can be read in App A but not App B by user A but never user B).
  • The publisher (or author) receives little transactional information about the sale.
  • The network (platform) controls access to read or publish the book (via a mechanism known as Digital Rights Management, or DRM). If either the publisher or reader don’t like the terms of the transaction they are stuck by the DRM.

Compare this to the UC Berkeley data donation example:

  • The researcher has received clear, unforgeable consent to use an individual’s data for the duration of the study.
  • The donor knows that their data is going to a specific researcher for a specific study. During the course of a study they can opt out and no further data will be transferred. They can also directly communicate with the researcher if they have questions about how and where their data is being used.
  • The Bitmark blockchain controls access rights to the data stream. Only digital signatures from the donor or researcher can change these rights. (The data itself is encrypted on the donor’s devices for only the researcher. No one in the middle can decrypt it.)

When individuals have agency, over time, closed networks become open economies. We have seen this before with the ownership of land and also knowledge. Now is the time to make it happen with data.

Join us in our efforts to democratize the digital economy. Sign up for our beta and try our IFTTT service. If you have any questions, we’re @BitmarkInc on Twitter.

By Bitmark Inc. on June 25, 2017.

What to expect when you’re using Bitmark

In modern society, freedom and economic prosperity means property ownership and accumulation of wealth. But increasingly the stuff we create and value most exists only in our digital lives, where there’s no system for individual ownership. The Bitmark mission is to empower universal digital ownership so we can live free online. To get there, we are making simple tools that help you to interact with the Bitmark property ownership system. These tools will enable a new level of control and freedom over your digital life. You can:

  • Buy digital works, directly from their creators, that give you — the owner — full rights to use, sell, and trade.
  • Donate your health data, trapped in your devices, to researchers advancing the frontiers of public health.
  • Begin a digital estate to protect your online legacy and wealth.

How to get started

Bitmark will be easily folded into your everyday patterns. We’ve integrated with IFTTT to make asserting ownership over your digital life seamless:

If this, then bitmark

Once you’ve established a Bitmark account, quickly connect it to IFTTT and choose which applets will help you most. Some popular options involve collecting your photos across social media and storing them in one simple place. Your articles can be bitmarked and shared across the web with protected attribution. Or, you can donate the health data from you phone to aid researchers advancing public health.

When your personal data and digital assets can be automatically converted into your own property, the opportunities are almost endless!

When you’re interested in transferring your data to someone else, or perhaps someone asks to receive your digital property, the steps will be very simple to get you there. Since the individual is central to the Bitmark mission, we use the most direct interface possible. Here is an example of a photograph entitled Dune in California that Xarene created then shared over Instagram and bitmarked (assigned property ownership to it) using IFTTT:

Everyone in the world can view the bitmark for this property:

A bitmark contains all the important information necessary to authenticate the ownership claims over a digital property. Included is also the provenance — the full ownership history of the property.

Is Bitmark secure?

A good way to understand security is by asking “Who is in charge of security?” The Bitmark system was designed to put individuals in control.

Your data is first encrypted and then stored in cloud storage that you control. That is totally private. The property title for your asset, known as the bitmark, is stored in the public Bitmark blockchain. That is public so it can be authenticated by anyone.

When you want to transfer ownership of your property (eg: sell, donate, or bestow), technically you are transferring ownership over the bitmark to a new owner. Then they will have rights to the data. Transfer records form a “chain of ownership” acting as a public record that protects both parties to transaction. Once the ownership transfer is recorded in the blockchain, the data will be re-encrypted for the new owner and then transferred to them.

You don’t need to know how blockchains work to use Bitmark. Conceptually, what’s important to understand is that blockchains allow for the exchange of value without central intermediaries. This is something that was thought to be impossible. It’s why Bitcoin, the blockchain for money, is significant. It’s money, issued by the people (not governments or corporations) that can’t be forged or censored. Similarly, Bitmark, the blockchain for property, is significant because data can become a property, owned and stored and transferred by individuals freely as they choose.

What is this all for?

At the simplest level, property is provenance: the “chaining of ownership” from the present all the way to the origin. The ability to demonstrate clean title is what protects one’s investment in a property by guaranteeing strong provenance.

In today’s digital economy, individuals create so much value, yet we have little to no ownership over the content we create and the data we generate.

Bitmark’s tools define a new digital freedom by providing an economic framework of standardized property rights, rules, and infrastructure.

The system will allow individuals to derive value from digital property just as we do from the things we own in the physical world, including selling, buying, transferring, donating, licensing, passing down, protecting, and much more.

When you create your Bitmark account, you will be part of the digital revolution, you will own your piece of the digital economy. Once you’re in the network you will be able to:

  • Feel relief if you’re an artist because your images, artwork, doodles, messages, prints, photos, and work will be yours and yours alone.
  • Take comfort in the security that your digital files, statements, contracts, and information will be safe and tracked if something should happen to you
  • Have peace of mind that you can legitimately share the pieces of your digital world with anyone you choose to and that no one can take that away.
  • Feel like the cool kid on the block because you have just stepped onto the cutting edge of the new digital infrastructure.

Join us!

Here’s our IFTTT service:

By Bitmark Inc. on June 15, 2017.

UC Berkeley and Bitmark partner to bring data donation to public health studies

UC Berkeley and Bitmark partner to bring data donation to public health studies

Bitmark technology allows users to take ownership of their digital lives and help advance the frontiers of public health

Our phones and Fitbits track our steps, calories, sleep cycles, and more. This data is empowering and helps improve our wellbeing. This data can also aid research in myriad areas. What if you could safely donate your data directly to those who are advancing the frontiers of public health?

Today, we are extremely excited to announce our partnership with UC Berkeley School of Public Health to explore how to accomplish exactly that.

Bitmark will fund two School of Public Health research fellows to conduct studies that securely incorporate personal data from our phones and other devices. When students return in the fall semester, they will have the opportunity to transition from passive internet users to active participants, taking ownership of their digital lives, and helping to advance public health.

“The School of Public Health at UC Berkeley is excited to partner with Bitmark Inc. on this research fellowship. It is a great opportunity for our young researchers to gain valuable hands-on experience at the intersection of public health and technology.”

— Lauren Goldstein, PhD, Director of Research Development, School of Public Health, UC Berkeley.

Announcing the Berkeley fellows!

Bitmark is pleased to announce Madelena Ng and Victor Villalobos as the fellows who will be using Bitmark technology in their future studies as part of this new partnership. In addition to funding support, Bitmark has committed to providing dedicated engineering resources to work closely with fellowship recipients to help them realize their research goals. Here are the brief abstracts about each of their research project plans:

Study 1: Ameliorating Recruitment Challenges for Women’s Health: Madelena Ng

Madelena is a doctoral student in Public Health. Her research aims to evaluate whether digital health technologies alleviate existing challenges in clinical research.

Objective: This study assesses whether recruitment and data collection into a women’s health focused digital study is optimized by leveraging Bitmark’s capability with securing personal data ownership.

Hypothesis: Physical activity and quality of sleep are consistently reported to promote better overall health; we hypothesize these factors are positively correlated with a telling element of women’s health — regular menstrual cycles. In addition, we hypothesize that educating potential participants about data ownership and the Bitmark app will lead to improved participation and participant experience in the proposed digital study.

Methods: Personal health data will be sourced entirely from digital health technologies, specifically Fitbit and Clue, to assess the effects of health behaviors (e.g., physical activity and sleep) on the menstrual cycle. In addition, eligible participants will be randomly assigned to either receive or not receive an education module about data ownership and the goals of the Bitmark app.

Study 2: Improving Diabetes Care Protocols by studying remission cases: Victor Villalobos

Victor is a doctoral candidate in Public Health, his expertise is behavioral design, biostatistics, and lifestyle interventions.

Objective: The objective of the diabetes remission registry is to refine and improve diabetes care protocols through the study of diabetes remission cases.

Methods: Participants will be recruited through digital and traditional channels. After informed consent and verification of clinical improvement, we will apply qualitative research instruments about their natural history of remission. With the use of Bitmark, participants will be able to share detailed information regarding their lifestyles — i.e. dietary composition and frequency; physical activity intensity, duration and frequency; sleeping patterns — and physiological indicators collected through their smartphones and connected devices (i.e. weight scales, heart rate wrists monitors, etc).

Expected Results: We expect to generate insights on the dietary, physical activity and psychological strategies that increase the probability to achieve and maintain diabetes remission.

Further details of this research can be found at

How the studies will work

Bitmark is developing simple tools that connect researchers to potential data donors through popular Messenger apps such as Facebook Messenger and WeChat. These tools, also known as a “bot,” automate the entire donation process:

  1. discovering available studies,
  2. extracting personal data and converting it into digital property,
  3. recording consent such that a researcher can use the valuable digital property in their study.

Berkeley students will know exactly where their data is being used and for what purposes; researchers can directly confirm the provenance of data and the students’ consent to use it. Behind the scenes, the Bitmark bot interfaces with the Bitmark blockchain to provide a verifiable record of data donations, protecting both the researcher and data donor, without relying on central intermediaries.

Studies will collect data two main categories of data:

  1. iOS HealthKit data — such as characteristics (birth date, blood type,…), basic samples (height, weight, body fat,…), sleep samples, food samples (calories, vitamins,…), exercise samples (steps, flights climbed,…) and reproductive samples.
  2. Health tech wearables, devices, and sensor data from over 300 different data streams — such as Fitbit, Nest, Aware, and more.

Individuals can also ask the Bitmark bot simple questions such as, “How is my data been used?” and get back instant answers. At any time participants can opt out of donating data.

About Bitmark

Earlier this year, Bitmark launched their technology in private beta to allow all individuals to own and share their digital data, and take advantage of the value they create online. Currently our personal data is being held in our smart phones, fitness tracking devices, and more; with Bitmark individuals have the freedom to share their data with other individuals, companies, non-profits, schools, and more.

Bitmark is still in a private beta, if you would like to keep up with when the public technology will be released, please sign up to receive infrequent emails here.

By Bitmark Inc. on May 23, 2017.

All Future Supply Chains Will Contain Digital Assets; How the Bitmark team won the International Blockchain Hackathon

By Maureen Walsh & Sean Moss-Pultz

Huge congrats to the Bitmark engineering team, who took first place in the first annual International Blockchain Hackathon!

On March 29–30, 2017, Intel, The Floor, and The Tel Aviv Stock Exchange (TASE) hosted the hackathon with intent to create blockchain solutions for leading financial institutions. Among an atmosphere of intense innovation, many worthy startups attempted to create real solutions for leading world banks, using blockchain technology.

Based on the business challenges to be introduced by The Floor’s financial partners, the International Blockchain Hackathon gave entrepreneurs and start-ups the opportunity to drive new applications, showcase technological capabilities, and create some business opportunities for new blockchain-based ventures.

During the two-day hackathon, the participating teams implemented use cases presented by the financial partners. There were 2 competing tracks: corporations & independent developers (first prize was 5 bitcoins) and startups (first prize was 3 months at The Floor).

The Bitmark engineers, joined by Tel Aviv University student Ayush Chandrato, won the corporate & independent category. They developed a supply chain system for digital production, helping rectify the challenge of 3d printing industrial products.

Challenge: 3D Printing Supply Chain Issues

There are three main issues within a 3D printing supply chain:

1) files contain sensitive IP, 
2) copies of digital assets create issues with supplier trust, and 
3) current systems have a weak payment infrastructure.

Bitmark’s Solution: Authenticated Digital Production

Bitmark created software to digitally produce and distribute products with secure provenance. With Bimark technology a manufacturer can create a new digital product with name, description, and citation of ownership. The manufacturer can procure and track digital components directly from suppliers via the blockchain. Manufacturers can then purchase digital assets via the peer-to-peer network that is the Bitmark blockchain. If needed, manufacturer can adjust to market demands in near real-time.

Big thanks to the Bitmark team for their win, and congrats to the many other teams who developed compelling solutions!

By Bitmark Inc. on May 15, 2017.

Part 3: Understanding the Blockchain

Why did the creator of Bitcoin want decentralized, digital cash?

My previous two articles came at making digital cash from an objective perspective. I explained the need for decentralization and also the need for “proof-of-work” to safely record who has what. This article is going to take a step back and look at the Big Picture picture — Why decentralize cash in the first place? Money is an abstraction, so any redesign will unavoidably include a philosophical angle. I believe Bitmark’s new model of trust and privacy are the two important characteristics that make it unique in our world of government issued currencies. This article is about trust and how it connects (in my opinion of course) to why Satoshi Nakamoto, the creator of Bitcoin, wanted digital cash to exist.

To get started, I want to show you the very first block in the Bitcoin blockchain. What does a block actually look like? It’s raw data. Here is it:

This first block — known as the genesis block — technically could have been empty of transactions. But it was not. Along with the normal data necessary for the block structure, Satoshi manually inserted a single transaction. Here is that message:

The Times 03/Jan/2009 Chancellor on brink of second bailout for banks

This was probably intended as proof that the block was created on or after January 3, 2009. The message is a headline from this newspaper:

It’s obvious, but worth saying: Bitcoin emerged from a catastrophic financial crisis. The crisis was fundamentally a failure of trust. Satoshi programmed Bitcoin to have a radically different monetary policy, based on artificial scarcity and predictable issuance. In other words, it was based in mathematical trust.

The supply of Bitcoin is capped at 21 million. The protocol itself specifies that the reward for adding a block starts at 50 bitcoin and will be halved every 210,000 blocks. Each block is tuned to be found in roughly ten minutes. Thus, approximately every four years the block reward will drop in half. When the reward decrease to zero the process of record keeping will be rewarded by transaction fees alone.

What exactly motivated Satoshi to replace middlemen with math? I’ve read just about all of Satoshi’s public writings (thanks to Phil Champagne’s fantastic “The Book of Satoshi.”). I found this passage the most raw and revealing:

“The root problem with conventional currency is all the trust that’s required to make it work. The central bank must be trusted not to debase the currency, but the history of fiat currencies is full of breaches of that trust. Banks must be trusted to hold our money and transfer it electronically, but they lend it out in waves of credit bubbles with barely a fraction in reserve. We have to trust them with our privacy, trust them not to let identity thieves drain our accounts.”

Satoshi wanted digital cash, based on cryptographic proof, because without the need to trust a third party middleman, “money can be secure and transactions effortless.”

Trust and control of money are absolutely intertwinedIt’s important to always keep this in mind when thinking about digital cash. The blockchain wasn’t created as a way to make things faster. The real purpose was to remove censorship and central-control from money itself. Blockchain technology, properly understood, is a method to increase trust by removing central intermediaries and letting everyone, anywhere exchange value. And that is a radical idea whose time has come to reshape our world.

Continue with part 4: How Blockchain privacy protects consumers while thwarting mass surveillance.

By Sean Moss-Pultz on April 27, 2017.

Towards an Ecosystem of the Future by Property Rights

Towards an Ecosystem of the Future by Property Rights

Environmentalists advocate for the health of the natural environment through changes in public policy, for example groundwater management, and changes in individual behaviors such as recycling or donating land to public trusts, or introducing concepts like property rights to promote sustainability and stewardship of resources. This positive effect of property rights on the commons was demonstrated in 1960 by the economist Ronald Coase, who was later awarded the Nobel Prize for his theorem.

Similarly, the collective of internet users acting as digital environmentalists advocate for the health of the digital environment. Both as individuals and entities, they self-regulate, champion policies such as net neutrality that protect the digital environment and its users, and invent technologies that aid in empowering the inhabitants of the digital environment against unethical uses of the resources of the internet and Internet of Things (IoT).

It is necessary to build on the analogy of the natural environment for the digital environment. For many of us, by nature of our heavy use of the internet, mobile devices, smart accessories, and social media, the ecosystem that we inhabit is simultaneously both of these environments. By acknowledging these two, we can ensure the health of both. While our current ecosystem is these two distinct yet simultaneous environments, our far future technological and biological progress could lie in an ecosystem where there is no distinction between the natural and the digital.

Hence, establishing and adopting the concept of clean technology for the digital environment with the same intentions as it is used in the physical and natural environment is a forethought ensuring a healthy digital environment of the future. The efforts of resource management and sustainability of the environmental movement has generated clean technologies that work towards bettering the quality of the environment and lessening our negative impacts on it. Comparably we begin to see that many companies that have arisen for the necessity of a healthy digital environment can also be considered clean-tech for the internet.

These clean-tech companies span a spectrum of how they handle resources (data) in the digital environment:

  • Providing absolute privacy where little data as possible is put in the environment, like TOR browser and Signal;
  • Managing the data that is generated and exchanged, like identity management and self-sovereign identity with OpenID and uPort, password and security management such as LastPass and DashLane, or social media managers like Buffer, or an IoT manager like IFTTT;
  • Reinstating peer-to-peer trust by cryptographic proof and immutability of data by using blockchain technology, like Bitcoin.

In an ideal and healthy digital environment we know what is what, who is who, what belongs to whom, and what came from where. This can mean verifying data, verifying identity, verifying ownership, and verifying provenance of data, all of which can be private and anonymous. Any combination of the clean internet technologies outlined above aid us in being digital environmentalists and to tailor how we manage our data. However, currently our data is part of a commons—we’ve generated it through our use of internet companies like social media and our use of IoT technologies, but our data is sitting in a common grazing field for these companies to sell for profit. Where are our property rights to this data commons that is open to all for profit?

One of the most impactful essays for biologists is Garrett Hardin’s 1968 essay where he coins ‘the tragedy of the commons’ and introduces the concept of property rights to avert it. The example he gives of the tragedy is of the overgrazing of a common land by each herder who has access to it. Self-interest in the commons is not necessarily in the interest of the commoners as a whole. Since then, it has been repeatedly studied and proven that well-defined property rights applied to the commons creates incentives for each owner to act as a steward for the resource.

With the agency of ownership comes the responsibility of maintaining the integrity of the digital environment.

To answer the “tragedy of the commons” in the digital environment we need a new clean technology for the internet that gives us property rights to our data. These rights are not just for preventing ‘overgrazing’ by others, but to restore our power to our privacy with private property as opposed to common property, and to enable us to generate wealth from our data if we choose to. So the fourth type of internet clean-tech introduced above would be:

  • Enabling property rights to the data we generate.

This is what Bitmark does. It enables a transparent chain of ownership and attribution across the internet and Internet of Things that can be authenticated by anyone. With the agency of ownership comes the responsibility of maintaining the integrity of the digital environment of our collective data and digital assets.

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By Bitmark Inc. on April 6, 2017.

Defining Property in the Digital Environment. Part Three.

Bitmark, the property system for the digital environment.

In Part One of the series we took a look at the history of property while Part Two made the connection on how the prerequisite for privacy is property rights. This final post introduces a solution for defining digital property, Bitmark.

Bitmarks as property titles

The Bitmark system achieves extremely low transaction costs by supplanting conventional centrally controlled property systems with a shared, distributed ledger for recording digital property titles, or bitmarks, for any digital asset. A bitmark consists of four basic elements:

  • an asset fingerprint
  • asset metadata
  • an owner account
  • a digital signature

A bitmark’s asset fingerprint is created by applying a cryptographic hash function to a digital asset. The resulting fingerprint is an alphanumeric value that uniquely and permanently identifies the digital asset. The asset metadata consists of the property’s name and relevant attributes, as defined by the bitmark’s original issuer. The owner account identifies the current owner’s Bitmark account number, which is a cryptographic public key. The owner may choose to publicly link his or her identity with this account number, depending on the desired level of privacy. A digital signature is a secure mark of authenticity that is appended to the bitmark when first issued or whenever it is transferred to a new owner. One way to think of a bitmark is as an unforgeable chain of digital signatures that form the property’s provenance.

The Bitmark Blockchain

To enable this recording of property titles across the full depth and breadth of the Internet, Bitmark supplements existing methods for tracking provenance with a globally accessible property ledger known as the Bitmark blockchain. Blockchain technology is the key innovation of the Bitcoin currency and refers to a digital ledger that is publicly yet anonymously shared to all members of a peer-to-peer network. The Bitmark blockchain contains every single property title and ownership transfer ever recorded in the Bitmark system. This Internet-native ownership registry allows the Bitmark system to satisfy all the functional requirements of conventional property systems in a single public data resource:

The Bitmark blockchain.

At a more granular level, each bitmark consists of a chain of transfer records that weaves in and out of different blocks of transactions to create its provenance. The authenticity of each property’s provenance is maintained by continuously verifying this chain of owner signatures.

A bitmark’s chain of signatures.

As an example, consider the figure above, in which a Bitmark user named Alice issues a bitmark for a specific digital asset. Her Bitmark app first uses a cryptographic hashing function to generate a unique fingerprint for the digital asset along with an issuance record for the bitmark which lists Alice as the owner. Alice’s app also digitally signs the issuance record with her private key. Once it has been verified by the Bitmark network, this issuance record is aggregated into latest block of the Bitmark blockchain (let’s say block 13). When Alice later wishes to transfer ownership of the property to Bob, Alice directs her Bitmark app to create a transfer record that contains a link back to her previous issuance record, designates Bob as the new owner, and digitally signs the transfer record with her private key. Once this transfer record has been verified by the network to contain an authentic signature from the current owner (Alice), the transfer record is recorded in block 20 of the blockchain, at which point ownership passes to Bob. This method of requiring the current owner to digitally sign ownership transfers creates an unforgeable provenance for a property. The Bitmark system has been architected to support multiple digital signing methods, including digital signatures that guard against the possibility of future attacks from post-quantum computers.

Strength Through Decentralization

Unlike conventional property systems that rely on a handful of trusted government officials to act as centralized gatekeepers, the Bitmark blockchain is an open and transparent property system that is strengthened through the active participation of anyone on the Internet. The integrity of Bitmark’s open-source blockchain is ensured by a peer-to-peer network of voluntary participants running the Bitmark node software called bitmarkd. These software nodes are incentivized to participate in verifying Bitmark property transactions through the possibility of winning monetary and property rewards.

A more diverse and decentralized participant community means a more robust property system for everyone.

Every Bitmark property transfer requires a nominal transaction fee. One reason for this fee is to discourage vandals from spamming the blockchain. A second reason is to motivate the participating nodes to independently compete against one another to be the first node to verify the current block of transactions and “win” that block. A node wins a block by solving a difficult computational problem called a proof-of-work, which functions like a lottery to randomly select a winner.

Whenever a node announces itself to the network as the winner of a block, it presents its result so that the entire peer network can instantly check the proof-of-work and validate the block’s transactions. After confirming the block’s validity, non-winning nodes “vote” for the winner by adding the block as the next block in their local blockchains. The block winner is then awarded all the aggregated transaction fees for that block. As an added incentive, the Bitmark system treats the blocks that comprise its blockchain as digital properties in and of themselves, and the block winner is also issued a bitmark for that block. Block owners are entitled to collect royalties on all future property transfers for properties whose issuance records are recorded in their blocks. The ability for nodes to win ownership of blocks not only creates a further incentive for node participation but also reduces transaction costs for adding digital properties to the Bitmark system to near zero.

This strategy of rewarding an open network of peers for competitively verifying the results of one another’s work creates an impregnable security model that is an emergent property of the individual peer interactions themselves. Unlike centralized property systems, which suffer from increased negative externalities as larger populations exploit the shared resource, Bitmark’s decentralized blockchain grows more resilient and valuable as the network grows. As a method for encouraging the widest possible participant base, the Bitmark blockchain has been designed to resist centralized monopolization of network node resources. Unlike preceding blockchains, many of which have become vulnerable to the outsized influence of a few well-financed mining pools, the Bitmark blockchain has implemented a proof-of-work algorithm that has proven itself largely impervious to the high-end custom mining hardware that has led to the inequitable concentration of Bitcoin mining power, thereby diversifying node participation and fostering cost-competitiveness among independent participant nodes. Wherever possible, Bitmark has endeavored to build upon the lessons of pioneering blockchain systems to broaden network participation because a more diverse and decentralized participant community means a more robust property system for everyone.

Data Privacy Through Digital Property

Bitmark affirms individual privacy rights within the digital environment by, first, allowing anyone to create private property from any type of digital asset and, second, by implementing strong encryption measures for the digital assets themselves. The ability to convert any type of digital assets — whether content or metadata — into private property makes any unauthorized data access a violation of one’s property rights, thereby providing an added measure of legal defense against unwarranted search and seizure of digital properties. Asserting explicit private property claims are particularly advantageous in incipient domains where digital property rights remain murky, such as device location data, Internet-of-Things traffic, or collaboratively authored social media content. As more of our daily activities are inconspicuously scattered across different third-party cloud servers, Bitmark offers a mechanism for asserting clear ownership claims to personal data, even in cases where individuals have voluntarily consented to provide their data to third-party services.

There will undoubtedly be cases where governments or other entities succeed in circumventing Bitmark’s legal and technical privacy protections and obtain access to owners’ properties, whether through legitimate due process, abuses of power, or radical political upheaval. History is replete with examples of asset forfeiture, eminent domain, expropriation, and nationalization, in which the powers that be have forcefully seized selected populations’ properties and subsequently reallocated their property rights. One of the glaring liabilities of government-administered property systems is their inherent susceptibility to the vagaries of political climates. By providing a shared global property ledger independent from any single institution, regime, or hegemony, the Bitmark blockchain serves as a permanent and politically agnostic record of ownership claims. While the blockchain can never prevent the possibility of government confiscation of one’s assets, it does provide an enduring record of ownership claims that can serve as grounds for future contestation of property rights should political conditions change.

In addition to providing increased legal defensibility of digital properties, Bitmark employs strong technical measures for protecting digital assets during transfer and storage. By default, Bitmark encrypts all digital assets so that only verified property owners can access their properties. Whenever a property’s bitmark is transferred to a new owner, the corresponding asset is encrypted then transferred so that only the new owner can access it. This method of end-to-end encryption affords asset protection for local or remote storage in addition to safe asset transfer over the Internet or across peer-to-peer file-sharing networks.

Additionally, the Bitmark system protects owners’ identities by default. Even though every bitmark issuance and transfer record is freely accessible in the public Bitmark blockchain, these records only contain references to owners’ cryptographic public keys, which function as pseudonymous identifiers devoid of any personal information. In cases where owners wish to have their accounts tied to their personal identities, they can opt to publicly link their Bitmark public key to other verifiable means of identification, including web domains, Twitter accounts, and GitHub accounts. This combination of asserting private property rights over digital assets as a legal safeguard for data privacy in conjunction with leveraging strong encryption protocols for protecting the privacy and integrity of the digital assets achieves a level of privacy protection commensurate with long-standing protections for physical properties.

Bitmark allows creators to exert clear ownership claims to digital properties so that they can be fairly recognized and compensated for their efforts… Similarly, Bitmark extends real property rights to consumers by granting them full control over the disposition of their properties.

Towards a Healthy Digital Environment

The Internet’s earliest pioneers and homesteaders demonstrated little regard for something as prosaic and establishmentarian as property rights. To them, the early Internet held the promise of a vast, utopian frontier where humans could transcend the age-old restrictions of physical existence and come together in an unfettered society of the mind. For these early explorers, the Internet’s lack of property rights was not a bug, but a feature. Yet for all the romantic allure of frontiers, the Internet has turned out to be a pretty rough place, precisely because it lacks the rule of law that has developed to protect individual rights within modern societies. In frontiers, more often than not, might makes right, and one person’s new-found liberation is another’s negative externality.

The Internet has democratized communication to such a degree that today anyone with a networked device can instantly connect to hundreds of millions of people. A teenager with a smartphone and a Facebook account can become an Internet sensation overnight. But for most of its existence, the Internet has not possessed a similarly democratized means for valuing what happens in its spaces. E-commerce exists, of course, but primarily only as high-friction articulation points between the Internet and conventional financial systems. It is ironic that credit cards, whose security model hinges on absolute privacy of account numbers, have become the default payment method for the Internet. When limited to the physical point-of-sale payments for which credit cards were originally designed, their fraud risk was manageable. Credit card designers never anticipated that people would voluntarily give their credit card numbers to anonymous entities on the Internet. Retrofitting the ill-suited credit card system to underpin e-commerce has required a monumental centralization of technical and commercial infrastructure, which has largely come at the expense of increased fees for merchants and greater incursions on individual customer privacy than are necessary for the lion’s share of online transactions.

If one considers the level of decentralization and privacy afforded by simple physical cash, e-commerce gateways represent a large leap away from the decentralized spirit of the Internet rather than a step toward it. Only with the advent of Bitcoin in 2008 did the Internet have its own truly endogenous currency — a unit of exchange as decentralized as the Internet itself. Suddenly, anyone with a networked device could freely engage in the kinds of financial transactions that had previously been the exclusive domain of sovereign states and their monetary trustees. Suddenly, the frontier had a native means for anyone in the world to exchange money as safely and privately as one might exchange a text message or selfie.

Just as e-commerce sites offered an intermediate remedy to the problem of payments on the Internet, “digital rights management” (DRM) has served as a stopgap for the lack of an Internet-native property system. However, DRM concentrates too much power in the hands of a few centralized gatekeepers at the expense of individual property rights for everyone else. Although DRM platforms position themselves as altruistically doing the heavy lifting required to make the digital economy work, the reality is that DRM platforms only serve their own interests by further locking both creators and consumers into their platforms. While DRM offers the semblance of digital property rights, in actuality DRM functions more as an extralegal police force that — as cases like Amazon’s 1984 incident have made clear — is solely concerned with hamfisted enforcement of its own platform policies, even at the expense of trampling over long-established individual property rights.

Conversely, property rights offer an elegant solution that has already evolved to be decentralized in the same way that physical currency is already decentralized. Centuries of legal precedents have already balanced property rights to protect both creators and owners. What is needed, therefore, is not the engineering of a new kind of police force for the digital environment but rather an Internet-native property system that brings already established property rights to digital assets. What is needed is a system that allows anyone to safely and easily claim and transfer property rights in the digital environment as safely and easily as they can transfer physical properties.

Bitmark has built this property system for the digital environment. Particularly with the emergence of the Internet-of-Things, we are realizing that the Internet is not some idealized, disembodied, virtual realm that is discontinuous with our physical realities. Rather, the Internet is deeply embedded in our physical world and increasingly orders and controls its relations. This convergence between physical and digital environments makes establishing clarity around digital property rights all the more urgent.

The Internet can no longer be governed by a frontier code. The resultant negative externalities — from widespread privacy intrusions to rampant online piracy to entire asset classes mired in dead capital — are just too numerous and too acute to remain unaddressed. We have reached a tipping point at which we must pose the same question of the digital environment that we have previously asked of our physical environment: Are we creating the kind of world that we want future generations to inherit?

Bitmark both strengthens and expands the Internet’s essentially decentralized, open, and transparent ethos. The Bitmark blockchain supplants the byzantine jumble of archaic, expensive, and incompatible state-controlled property systems with a single cryptographically secure, extremely low-cost, and globally accessible system for tracking properties and provenance. By bringing both market forces and the rule of law to the digital environment, Bitmark allows creators to exert clear ownership claims to digital properties so that they can be fairly recognized and compensated for their efforts. Similarly, Bitmark extends real property rights to consumers by granting them full control over the disposition of their properties. As an all-inclusive property system that respects and accommodates jurisdictional differences, Bitmark broadens the types of commerce that can occur, thereby reducing the expediency of solutions that result in negative externalities. This ability to extend economic participation to every corner of the Internet creates value for the larger global economy by transforming the digital environment’s deepening morass of negative externalities into a new property boom capable of powering the next major economic revolution.

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By Bitmark Inc. on March 9, 2017.

Part 2: Understanding the Blockchain

How to make decentralized, digital cash.

(Part 1 was A brief history of decentralization: about E-gold, Napster, and BitTorrent. What follows is part 2 of a 5 article series for the curious, non-technical reader.)

As a technology, cash is pretty impressive. It’s easy to verify and difficult to forge. When you pay for a coffee with cash, a third party is not required to verify and process that transaction — it’s peer-to-peer and decentralized. Most likely, the only personal information revealed was your physical appearance. If digital cash is to be adopted, then it should, at a minimum, behave similar to physical cash from the perspective of the individuals involved. This article will explain how to create digital cash that is 1) hard to forge and 2) transferrable without requiring a third-party (aka: decentralized).

Long before the days of e-gold (link back to previous post), people knew how to make something digital that was hard to forge. It’s called the digital signature.

A digital signature is a mathematical scheme to authenticate digital messages. The content of the message doesn’t matter — anything digital can be signed. Digital signatures employ cryptography. Most schemes have three parts:

  1. The generation of a private key and a corresponding public key.
  2. A signing algorithm that, given a message and a private key, produces a signature.
  3. A signature verifying algorithm that, given the message, public key and signature, either accepts or rejects the message’s claim to authenticity.

For some time, I struggled with how to explain digital signatures to people unfamiliar with cryptography. Then I realized the Chinese seal might be an interesting analog:

Chinese seals are typically made of natural materials (stone, wood, ivory, … ). Official documents are stamped with an individual or company’s seal instead of a handwritten signature. This has some advantages. Each seal is unique and difficult to duplicate because the surface details of the organic material cause detectable variations when the stamp is used. By fanning the pages, a stamp can be applied over multi-page documents such that it is easy to detect if a page is missing or changed. Some Asian governments and financial institutions keep stamps on record for fast, precise verification of documents.

Here’s how you would authenticate a digital document:

For example: An individual has a private key (seal) that represents ownership of their account and is used to produce a digital signature (stamp a document) that authorizes transactions in their name. Another party could view the public key (read the characters on the seal) and quickly verify their digital signature (against public government records) to accept or reject the claim to authenticity of the transaction.

We can create digital “coins” as signed digital messages. These will be very difficult to forge, which satisfies the first part of the solution. But if it’s possible to send the same digital coin to two or more people, AKA “double-spending”, then we have an incomplete solution. This “double-spending” problem, by the way, is far trickier than it might first appear. It stumped all previous attempts to decentralize digital money.

To understand how Satoshi Nakamoto, the creator of Bitcoin, resolved doubling spending, it helps to consider a smaller, simplified example first. Three people — Alice, Bob, and Carol — want to transact using digital coins. Everyone starts with one digital coin, and they agree upon some rules:

  1. New transactions are digitally signed and shared with everyone.
  2. Each person records new balances in their own sheet (spreadsheet).
  3. If a transaction spends the same coin twice, the first transfer is recorded in the sheet and the second is ignored.
  4. Once per day, everyone compares sheets. If the majority (two of three in our example) of the sheets are the same, the corresponding balances are accepted as “correct.”

Initially, things would look like this:

Sheet 1 (Account Balances)

 Account Balance  
--------- ---------
Alice 1
Bob 1
Carol 1

Then Bob sends his coin to Alice and Carol transfers her coin to Bob. They each record the new balances in their sheets, and at the end of the day, the majority agree on the following sheet:

Sheet 2 (Account Balances)

 Account Balance 
--------- ---------
Alice 2
Bob 1
Carol 0

You could see how this process would continue. Each day settlement happens, and a new sheet is added. Consensus is reached among Alice, Bob, and Carol through a simple majority. The process is nicely decentralized and peer-to-peer.

Yet there’s an obvious problem: Bob and Carol could collude against Alice. They could get together and agree to reverse each other’s transactions — effectively changing their account balances. Again, “correct” is whatever the majority agrees upon.

One way to reduce the effectiveness of colluding is to randomly pick one participant’s sheet and accept that sheet as “correct”. This works when people are known, yet, when we switch to computers talking to one another, we still have a problem. Someone with more computers would have a disproportionate chance of his or her sheet being selected. This is where a “proof-of-work” system is needed. A proof-of-work is a computational puzzle that is costly or time-consuming to produce but easy for others to verify. One way to think of a proof-of-work problem is like solving a Sudoku puzzle. The goal of Sudoku is to complete a partially filled in 9×9 grid with digits such that each column, row, and 3×3 section contains the all the numbers between 1 to 9 once and only once. Although solving a Sudoku puzzles requires a lot of time and effort, anyone with a knowledge of the rules can immediately verify a correct solution without having to solve the puzzle themselves.

We can use a proof-of-work puzzle, related to the account balances in a given day, to make it expensive to connect many computers and keep them computing the puzzles. Let’s modify our sheets to also include the solution to the new and previous puzzle. (You will see why we need the previous puzzle shortly.)

Here are the updated rules:

  1. New transactions are digitally signed and shared with everyone.
  2. Each person records new balances in their own sheet (spreadsheet).
  3. If a transaction spends the same coin twice, the first transfer is recorded in the sheet and the second is ignored.
  4. Once per day, everyone works to solve the proof-of-work puzzle for their sheet.
  5. When a person solves the puzzle, they record it in their sheet and share it with everyone.
  6. People express their acceptance of the sheet by working on creating the next sheet in the chain, using the puzzle from the accepted sheet.

In effect, we have “chained” our sheets together such that making a change to any single sheet requires redoing the puzzle — not just for that specific sheet — but for all the sheets thereafter. Why? Because once a proof-of-work is created for a given set of balances, it cannot be reused for different balances without redoing the work. As later sheets are chained after it, the work to change the sheet would include redoing all the sheets after it.

I hope it’s obvious to the reader that my sheets are blocks and the chaining forms the “blockchain”. (Even though it’s more of a mouthful — I prefer calling it “proof-of-work” chain). The very astute reader might realize it’s possible that two people could share a block at the same time. (These blocks would differ because their puzzles are digitally signed and are thus different.) In this case, the tie would be broken when the next proof-of-work is found and one of the branches in the chain becomes longer. A rule is that participants must work on the longest chain.

This concept of a blockchain becoming a “trusted” record secured through proof-of-work really is fantastic and original. It makes it possible to transfer digital money directly from one party to another without an intermediary. But there is something even more subtle and deeper that involves the incentives that emerge while the system is running. And this, in my opinion, is where Satoshi’s genius shines through the most. It’s how the system combines a proof-of-work chain with incentives to help participants stay honest.

By convention, the first transaction in a Bitcoin block is special. It creates new bitcoins owned by the participant that solved the proof-of-work for the block. This is a clever way to initially distribute coins into circulation without requiring a central authority to issue them. Yet it’s far more than that. The reward of new bitcoin adds an incentive to support and secure the network. If a greedy participant could assemble a lot of puzzle-solving power, he would have to choose between using that power to defraud people through reversing their own payments or using it to generate new coins. Clearly, it should be more profitable to play by the rules and win more coins than anyone else combined, rather than working to undermine the very system that is required to transact in the first place!

And there you have it.

Continue with part 3: Why did the creator of Bitcoin want decentralized, digital cash?

By Sean Moss-Pultz on January 21, 2017.