Blockchain: A Proof of Trust

Abstract

This report explores the topic of ‘designing for trust in blockchain solutions’ as part of the technology’s adoption by clients of Cognizant. The result is a game that provides clients with a first insight into the new form of trust relationships that blockchain brings.

In recent years blockchain has gotten attention from public, business and politics. It is said to decentralize the exchange of value, similar to what the internet did for information. For this blockchain addresses the key topic of trust. In the past decades trust has evolved from local to institutional to partly decentralized. Blockchain takes this further and assumes distrust among peers and enforces exchanges through hard code. Instead of having to trust a peer or a third party, people can trust the veracity of the process. Although proclaimed to be trustless, trust still needs to be placed in the technology itself. The goal of this project was to design an experience that allows people to build (initial) trust in blockchain technology. Understanding the role of trust in a blockchain ecosystem was achieved through a literature study on trust in technology, a decomposition of blockchain and a case study of one of Cognizant’s blockchain projects for a multinational shoe retailer on inventory sharing.

From a theoretical perspective results show that trust still plays a role in blockchain ecosystems: A lack of computer literacy prohibits people from understanding the open source algorithm code. Governance of a blockchain protocol can be fuzzy, making individuals unable to control changes. Blockchain propositions often include human interaction or physical products which cannot be affected by a blockchain system. Data that is fed into a blockchain system cannot be checked for correctness by a blockchain system, thus providers of this data still need to be trusted. Transfers done on a blockchain cannot be undone placing a heavy weight on someone’s personal trust (self-confidence). If a crypocurrency is used, participants need to trust that it will maintain its’ value.

Another key challenge is nudging trust towards a justified trustee. Blockchain appears to bring forth a new form of trust that is not peer-to-peer nor institutional. Rather, trust has to be placed in a collection of components (code, cryptography and protocol) that is controlled by an algorithm and collective group. It will take time for people to adopt this new form of trust as social norms need to (be) developed.

Results from the case study show that adopting blockchain technology is not only a technical or business feat but also an emotional and social endeavour. Setting up a blockchain ecosystem forces the initiating company to engage with competitors in a more direct way and seems to feel like they have to open up. It creates interactions that companies might be uncomfortable with as it often concerns sensitive data. Next to this, it seemed hard to really grasp or experience the value of blockchain technology which can be a barrier when designing with it. Clients also appeared to approach the technology using ‘old’ trust concepts, which might result in missing out on the technology’s real potential.

Cognizant could play a key role in making clients comfortable with this new form of interaction by offering direct experiences with blockchain rather than only knowledge transfer. Also acknowledging the emotional/strategic challenge of cooperating with competitors more closely is something where Cognizant should build activities around. Eventually the company could position itself as an ‘ecosystem builder’, providing support to not only the client but also the partners in shaping the ecosystem and relationships.

To support this role, an interactive game called ‘Viral Art’ was created that provides clients with an initial experience of the new form of trust and ‘coopetition’ that blockchain brings. Experiences from the game can lead into a discussion on the impact on a clients’ own business network and shape the further activities of a project. In the game participants simulate a digital museum and compete for the most valuable (unique) art through trades. Throughout the game players go through all three different forms of trust.

A final evaluation with Cognizant led to recommendations for further development including digitization, stronger facilitation and the extension to a workshop format.