Blockchain Bitcoin predictions

Qtum, the UTXO smart contracts blockchain, has released a new white paper and also announced that it is working with PwC in Asia. Qtum (pronounced Quantum) uses the Unspent transaction Output (UTXO) design of Bitcoin and connects that with the Ethereum Virtual Machine (EVM) which stores and executes business rules as code on the blockchain.

Qtum's co-founder Patrick Dei says he has addressed the complexity involved in combining an unspent transactions model with a virtual machine by creating the Qtum Account Abstraction Layer (AAL). Qtum's proof of stake consensus system includes a kind of "adapter" which can build the state of each UTXO and through the new layer, and adapt it so the EVM can process the UTXO-based contract.

The paper titled, Smart-Contract Value-Transfer Protocols on a Distributed Mobile Application Platform, was authored by the co-founders of the Qtum project, Patrick Dai, Neil Mahi, Jordan Earls and the project's scientific adviser Dr Alex Norta.

Qtum's UTXO-based blockchain supports the SPV (Simple Payment Verification) protocol from launch, which will allow "lite" wallets, running on mobile devices, to engage natively with decentralised applications and smart contracts for the first time. This feature also allows IoT devices to be secured and operated with smart contracts, said a statement.

Lite wallets allow users to interact with the network without having to download and sync with the entire blockchain, enabling low bandwidth/storage access to smart contracts. With SPV support, transactions can be signed by the device itself rather than having to rely on third-party services to relay messages.

Dai said: "Getting smart contracts to work on smartphones and tablets heralds a new age in the field of decentralised computation. With about half of all internet traffic being generated by mobile devices, every real-world use case for decentralised applications would massively benefit from mobile support – especially if we're taking the tendencies of developing markets into account."

Norta said: "This white paper fills the gap in the state of the art by presenting the Qtum smart-contract framework that aims for socio technical application suitability, the adoption of formal-semantics language expressiveness, and the provision of smart-contract template libraries for rapid best-practice industry deployment."

The white paper also addresses concerns raised by the Ethereum DAO attack, noted Dai, by allowing contract collaboration, negotiation, review, and tracking. A Smart contract life cycle management system enables contracts to be more like living documents and when situations changes, (i.e. terms are broken in the contract, such as a delay) parties can determine if they want to amend or close the contract.

Earls added: "Qtum aims to revolutionise business processes and the way that businesses interact with their customers by making smart contract technology mobile and practical. The SPV protocol allows smart contracts to move from servers and laptops, into IoT and mobile devices."

CY Cheung, fintech and cybersecurity partner of PwC China, posted a blog about the agreement with Qtum, and added: "PwC sees enormous potential for blockchain to revolutionise business practices as we know them, and the firm has made great efforts in developing strategic and technical capabilities to adapt existing products and services for the new technology. We are excited to get involved in the era of innovation and help companies capture the opportunities and benefits brought by the new technology. Working with the Qtum Foundation aligns with our goal."