How UBRI Supports Critical New Research into Blockchain Anonymity

By its decentralized nature, a blockchain is extremely difficult to hack. That does not mean that digital assets and wallets built on the technology are invulnerable, which is why the organizations behind them spend so much time thinking about security.

However, according to Stefanie Roos of the Delft University of Technology in the Netherlands, the blockchain industry will soon have to give equal attention to privacy concerns. Though she admits this idea may come as a surprise to those people who enjoy the anonymity of Bitcoin.

“Because you don’t have to enter your real name, people believe that Bitcoin is very privacy preserving,” says Stefanie. “But when someone keeps reusing the same information, it’s possible to track everything they do. If you can link that profile to a real person then you can see all their activity.”

Stefanie is assistant professor for distributed systems at the university, having completed an award-winning PhD thesis on the subject before working at Canada’s University of Waterloo. She’s well versed in using decentralized technology for payments having developed SpeedyMurmurs, a peer-to-peer system that takes a path-based transaction approach similar to Bitcoin’s Lightning Network.

Today, much of her focus is on ways to create flexible anonymity for blockchain-based payments, especially for enterprise transactions. Businesses paying suppliers on a public blockchain could inadvertently reveal details about products or services they’re developing to competitors. While private blockchain are the obvious solution, Stefanie believes public technology with appropriate anonymity could be more beneficial.

“Think of systems where anonymity is temporal,” she says. “You get privacy for the time that you need it. If you want to have transparency later on, you can reveal the relevant cryptographic keys to demonstrate that you complied with regulatory requirements, show off your high-quality suppliers or to prove a patent case.”

While individuals rarely have the same confidentiality needs as businesses, Stefanie believes consumers will soon realize the need for privacy around the payments they make on public blockchains.

“People won’t want others seeing what they buy or sell,” predicts Stefanie. “That has huge potential for blockchain bullying. Imagine teenagers knowing each other’s transaction history, being able to see who has the most expensive clothes or shoes. Some people may not want others to know that they get government benefits. We have to make sure that these systems preserve our privacy.”

Some of Stefanie’s students are looking at anonymity on the XRP Ledger, as part of Ripple’s University Blockchain Research Initiative (UBRI). Aided by UBRI grants, one student is looking at the Ledger’s consensus algorithms, while another is working on a new way of testing for security vulnerabilities when a theoretical blockchain model is translated to code on complicated, large scale projects.

“The two students obviously benefit from the UBRI grant, which will fund their PhDs,” she says. “But they’re also able to talk with people at Ripple about their ideas and whether they could actually be part of the system. It’s great motivation for this type of project, if you know there is a chance it can become a real product.”

Delft’s UBRI connection also benefits those attending the university’s blockchain Masters course. Class numbers are deliberately small so that students can not only learn the theory of blockchain but implement projects related to different applications.

“Our links with UBRI have been useful for the students implementing applications on top of the XRP Ledger,” concludes Stefanie. “One team created a bill splitting system, where one person pays a bill in the restaurant and the rest settle it using the XRP Ledger. It’s just sad that the coronavirus shut down all the restaurants, but hopefully they can test the theory in a real-world scenario soon.”

To find out more about how UBRI supports and accelerates academic research, technical development and innovation in blockchain, cryptocurrency and digital payments, visit Plus, watch out for our monthly On Campus posts on this blog.

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