After Cryptocurrency: Blockchaining the Internet of Things with Prof. Lee W. McKnight | WEBINAR

Good afternoon, everybody. Welcome to the second webinar for the spring semester at the School of Information studies Syracuse
University. I’m JD Ross, I’m the communications director here at the
iSchool and I’m going to be the host for today’s webinar. Today sitting right here
next to me is associate professor Lee McKnight and he’s going to be taking us
through the applications of blockchain technology. Now, it’s Valentine’s Day here
and I brought some candy in here with me to share with the folks helping to run
this webinar and behind the scenes and you too Lee you’ll get some candy too
and maybe after the webinar since this is Reese’s candy and if you can remember
maybe a while back their tagline used to be two great tastes that taste great
together: the chocolate and the peanut butter. And I think that Professor
McKnight today and his webinar is going to share some information about two
other things that go great together although not edible: blockchain
technology and the Internet of Things. If you’ve heard about blockchain technology
you’ve almost always up to this point hearted context of Bitcoin or
cryptocurrency and we’re not here to tell you how to get rich off a Bitcoin
today. But Lee is gonna take us beyond a Bitcoin mania. His research
at the iSchool has always been focused on leading edge leading edge
technologies and blockchain is certainly one of those. He’s been teaching a class
on blockchain management here and he’s in the second semester teaching that
class. It’s been very popular. And I’m going to turn it now over to Lee and let him
share some of his blockchain knowledge with you. So without further ado, please
welcome professor Lee McKnight. Thank you very much JD. Happy Valentine’s Day to
all of you listening in. I look forward to interacting with you over the course
of the hour. Do I change the slides? Do I do it? He’ll do it. There you go that answers your question. We have it all set. All right. So thanks so much for joining us we really look forward to the interaction
and the discussion at the end of the session. We’ll have about 10-15 minutes
and we look forward to your questions, comments, suggestions, on talking about after cryptocurrency. So beyond, cryptocurrency, blockchaining the
Internet of Things. The opening slide here, that’s not a way crypto sees our
mind or mind in Mordor. This is a volcano in Goma Democratic Republic of
Congo which ties in actually to watching the internet of things. As you’ll
understand better by the end of this discussion. So today we’ll be introducing
the topic I always like to start off with a couple
jokes and I have some good…well will see what you think of them. On the next slide, after that we’ll be reviewing both some basic information on
cryptocurrencies and blockchain. So we’re all up to speed on what this is all
about and where it stands today. This this new technology and opportunity and
then in the second half we’ll be going in to block chaining the Internet of
thing and its potential occasions new applications and new business models. And then we’ll conclude as already mentioned with the discussion with all of you
which I look forward to. So while this internet of ransomware things of cartoon
has a number of different jokes in it. But the ones that are relevant for us
today particularly are the one where it’s showing a sort of a compromised washer.
Saying ‘Your dirty dishes can wait, I’m busy mining bitcoins’, and another one
with the smoke detector that says of to use. This is assuming it’s an internet of
things house infected with all kinds of malware.Where it says 30 bucks in
Bitcoin, or I just might let you sleep through the the next time I smell smoke.
And then finally, I’m not gonna go through all these jokes, but the one I
particularly appreciate is the broom sayings ‘Send me 25 dollars or I’ll tell
everyone on your social network you that you were stupid enough
to buy an internet-connected broom!’ Okay so just because it’s possible to connect
everything to the internet. Maybe it’s not always a good idea. And maybe there’s
that everybody should be aware of and maybe blockchain has a role to
play in preventing these kind of nightmare scenarios that are
unfortunately all too real. Next slide please, so here’s the basic facts
everybody I guess it needs to know or should be aware of today. As of this
morning, as of an hour ago, there are 1530 crypto currencies in existence. You can
keep track of the daily count by checking with that link I have
provided there from market cap. The fact is my students in blockchain
management this semester could create multiple crypto currencies. If that was
what they chose to do but likely they’re going to be we’re looking at creating
companies that take digital blockchain technology with or without a
cryptocurrency and to understand that better as we go further into this. So one
more thing to be aware of we say cryptocurrency but it’s not a currency.
Next slide, okay. So the facts and these are just you know this is that this is a
straight everybody what a lot of people talk about the tough and they pretend
things are different than they are but the truth is the IRS, the Communities
Futures Trading Commission, New York State, do not define bitcoins or their
crypto currencies as currencies today. They’re commodities and regulated as
such and taxed as such and anybody that’s telling you different is either
scamming you or ignorant. And there’s a lot of that in the space so I want to be
warning people to watch out for people telling you things that are just not
true. One thing also to be aware of and this goes along with being a commodity
is guess what’s a characteristic of commodity prices are they swing up and
down and guess you all been hearing, reading the news, seeing how well these
crypto currency / crypto commodity prices have been swinging like any other
commodity. So the ultimately comes down to how this is supply and what is it
demand for crypto currencies and I’m just saying it’s very easy relatively
speaking to create a new currency or crypto currency which has some function
but whether it’s really valuable whether there’s a demand for it or not I suspect
many of those 1500 do not have any real sustainable business model or demand for
the long run but that’s something people should go into rather than this assume
there’s somehow a limit or scarcity to crypto currencies. Next slide. Having said that there is a lot of money
already of market capitalization around crypto currencies I’m showing you the
list of the top 11 by capitalisation. Again as of two days ago when I when you
put this table together. So obviously Bitcoin with over 140 around 150 billion goes up and down it’s been much more than that in December it’s it was much less
than that a year ago and on to cerium number two on down through never any ‘m
which is still over right around a five billion dollar market capitalization so
we’re not this is not a trivial space there’s 300, 400, 500 billion in that
range up and down. I think sit into crypto currencies / blockchain
technologies at the moment that’s actually only part of the investment but
there’s a lot of money there. Next slide please. Okay but we now have the basic like you
know there’s a lot of them you know there is some other worth a lot of money.
Right now, and that was like why what does… it not really or just a crypto
currency what is. So,inside crypto currencies is the blockchain which is
the real innovation there is a new distributed ledger technology which
creates a transaction record that underpins Bitcoin and all other most
other crypto currencies. In some ways, it’s like a spreadsheet, or database
except and this is a big exception it’s verifiably true record of all
transactions. Next slide, so the term blockchain it combines these two aspects of the distributed ledger technology. The secure on auto verified verification
mechanism that creates a maintain trust on a chain
and so for each digital record time-stamped verify to linked there is a
thread or a block which can be either open so like Bitcoin it’s an open public
blockchain or it could be a closed or private set of users. So if you’re using
this in an industry supply chain you maybe don’t want everybody to see all
the information and that’s like a design option between having a – you know the
watching technology can work either way. Next slide, okay. So the key character
of this blockchain technology and why it’s distinct from other databases or
other forms of Records. Is that you can’t be erased it’s immutable. So I’m showing
a stone ledger it’s obviously a more portable having it all digital. But it’s
basically it’s really you can’t you trying to crack a blockchain ledger is
like very very difficult and therefore can because it can be trusted and can’t
be erased it becomes a way to reduce the number of the role of intermediaries in
supply chain which should in theory over time reduce transaction costs whether
for financial markets or in other areas in which having trust between multiple
parties would be a value, or where there’s in efficiencies or friction in
the market, where there’s fraud. This is a way to eliminate some of that. Next slide.
Ok so inside blockchain going deeper in we have smart contracts which is really
in this is how new this is the the blockchain itself is pretty recent spark
contracts are from just invented a couple years ago but this is a automated
software program that works between different parties on the blockchain.
Which can then sort of negotiate and agree or disagree that’s saying there’s
this is actually a fraud transaction that’s trying to be entered into the
record and the distributed system can sort of automatically reject this.
Probably it’s a permitted to enter so that’s how good coin can work
where it’s an anonymous distributed ledger but it can’t be falsified because
of its math. Okay, so we see then because of the value of that it has gone up
tremendously having this capability but it also creates some new vulnerabilities these
and threats because of while the watch-chain itself can’t be cracked. A
cryptocurrency exchange is no more secure than any other information system.
And guess what? They’re not that secure in fact just two weeks ago half a
billion dollars was stolen out of one in Japan. So just as a poet says the
cryptocurrency may be secure but if the crypto exchange is not we can
still have serious problems. Now we get why our cryptocurrency changes being
robbed and from the first or only one there’s been many of them there once
attacked in South Korea just in December it had to shut down the largest there.
There was one in Japan that the amount cox was shut down in 2014. So crypto
currency exchanges are frequently a point of attack for the obvious reason
is that’s where there’s a lot of investment and maybe not very good
information security practices making it possible to steal a large sums from one
point. So this gets us this example sort of ties together some of the things
you hear around anonymity blockchain. While the Bitcoin protocol may
be anonymous you know if you’re moving more than ten thousand dollars that
would be money laundering that you’d be legally required to report in this
example we just let’s walk through that case from two weeks ago. NEM foundation
with its NEM fellow though he stated one more a second then the NEM foundation
knows has a full quote unquote full account of all the point of loss of
these coins these half a billion dollars but it can’t recover them. On the other
hand the thieves can’t really move them very easily because they’re sort of
being tracked at the same time. So we can say yeah it’s anonymous but it’s not
that anonymous at the same time. Next up okay so we’ve sort of gone through the
basics of cryptocurrency and we’re moving into this blockchain and we’re
moving into the Internet of Things discussion now that we full
understanding of some of the capabilities of blockchain creating this
trusted distributed record system, okay. So now in the Internet of Things space
when we use it when we say Internet of Things. We usually think about hardware
or a thing right that’s what it sounds like Internet of Things devices so it
could be a sensor it could be a camera it could be a monitor it could be all
kinds of industrial systems that’s that’s true those are part of the
Internet of Things but in addition to connect or reach them or to share
information. You need to have a network or multiple networks whether it’s a
Wi-Fi or like an industrial control system or a low raw which is a long
range wide area low-power of Internet of Things network technology.
That we’ll talk more about in a second or it could be the satellite. So some
form of networking in addition of cloud services are sort of core part of
the architecture meaning how do you a aggregate and monitor many many different
things in many many different locations. That’s through the cloud so
software-defined computing storage network data centers development
operations and everything are all tied together and tied together the Internet
of Things. Software as well is another distinct component it can be applied and
built in whether it’s usually may be stored in the cloud but it could also
be on distributed devices and resources so range of different processes
including you know artificial intelligent
capabilities as well as cloud capabilities for automation are all tied
together. Now here in Syracuse, we have our own
Syracuse things network up and running that’s a picture of the antenna on the
Berkeley diamond tower downtown. My colleague Chris Sedore former CIO of
Syracuse and my colleague Cameron Gale are joining me in the event
coming up in April. Where we’ll be talking more about Internet of Things
and its capabilities. Over as it grows and it’s just something we’re and people
we will I guess maybe will webcast at – why not or leave some of it we’ve done
this in the past and we’ll have include demonstrations of blockchain
technologies and projects of moneys. As well as IOT projects that my students
and others and people company the entrepreneurs are working on. So there’s
now over… this low raw Internet of Things network is in over 90 countries
and with over 500 cities it just had its first technical conference this
is just three years after a Kickstarter. You have a Internet of Things global
network with over 25,000 people entrepreneurs developers all working
together. Explore the capabilities of the Internet of Things and oh I did I
mention that it doesn’t cost anything to going onto this block chain network well
this unblocking network. This is just that you anybody can link anything to
this particular Internet of Things network. Now these same capabilities would
be many industrial cases you wouldn’t want if you’re the utility or the grid
to just have everybody getting on to your control network for the
grid and that we get to the problem. The problem is today and many of those
utility grids are using the open public Internet just like everybody else and
they have become susceptible to the same kinds of threats and vulnerabilities as
everybody else on every kind of system. So without if we don’t make things different for the Internet of Things going forward. There may be many new
problems. So I just want to highlight again this is a great time for
experimentation for entrepreneur, for students, to start playing with this and
those who are within can come to Syracuse or join us remotely then this
would be a great opportunity to learn more. Beyond we can cover in this
webinar and see more of the cool things that our wonderful Syracuse University
students have been creating this semester in my blockchain management
class. As well in Chris Sedores Internet of Things oriented of course. Okay, now we
get to the however, on the other hand. So on the one hand it’s great it’s
wonderful but internet security is bad, like real bad, like incredibly bad,
like a disaster. With basically this is from last year, this is
from Hewlett Packard, so this is not like just me saying this. It’s Hewlett
Packard’s study from 2017 saying eighty-four percent of Internet of
Things adopters have had a security breach and I will say though the
15 percent are too cool to realize that you’ve been breached. As my opinion and
suggestion that it’s likely closer to 99 percent that have a breach but the 15
percent are the ones that have the real problem because I don’t even know it yet.
so the current generation even if it’s 84 it’s 84 percent or 99 percent we can
debate that but the fact is current generation IOT systems are not
acceptable. They’re dangerous there’s a lot of vulnerabilities there’s
lots of flaws and we can do better in many different ways we teach our
students here how to do it but big companies and the government’s agencies
also recognize some of these problems as going in just a second so this is this
is again this is no joke just because you have a perfectly secure blockchain
you tie it to insecure Internet of Things and you’re old your whole just
like the NEM case everything stolen everything’s controlled because you have
a one secure piece that provides a perfect funnel for the hackers and the
thieves into the rest of your enterprise. Okay if I haven’t got you to worry yet this is all true. This slide is true. The largest pacemaker maker
St. Jude’s which was in a twenty five billion dollar buyout no merger campaign
in 2016. It was also at that time subject to a review of the security practices of
its pacemakers that was done by muddy waters those short sellers whose
business is like finding companies that are sloppy or doing something wrong
doing a study reporting on it and having already bet on the stock going down
because of the dangerous or fraudulent practice making a big profit.
So what Muddy Waters did and this is So people like me and others in the
industry have known for years that medical devices were not secure in fact
many of them never tried to be secure. Arguing hey it’s more important that any
doctor can try to help revive somebody if somebody’s having a problem with
their pacemaker it’s important that anybody can get into it on some security
because it’s unlikely there will be a lot of hackers out there attacking case
victims right. Well, Dick Cheney. Vice President. He was the
first one we’re having that assumption that nobody would try to do anything to
his heart was taken is not a safe assumption so he had his doctors his IT
staff upgraded his pacemaker years ago. To make sure that it couldn’t be a
subject of remote attack so luckily this is not news but the fact is now Muddy
Waters did a study and they showed so these what I’m saying is these results
are technic sound there’s no question this is true. Even though the Federal
Food and Drug Administration and St. Jude pace denied it. If you’re in the
space you know that’s not really. That this is accurate that from three meters
away so ten feet away Packers were able to disable or deliver
a shock to a from 12 meters, so about 36 feet around.
So you know 40 feet. You could compromise it if you had an antenna and
it had an upgraded system with software-defined radio you can do it
from 100 feet away meaning could be out of sight and you could be messing with
people’s hearts okay. That drove down the price of St. Jude stock by 10 percent in
a day and muddy water has got its big profit now they’re subject to a lawsuit
from St. Jude’s after the merger and like I said the FDA denied this.
Ok so who’s right? Do you believe St. Jude’s and/or the FDA or the FDA a
year later when they quietly recalled over a million pacemakers. Okay, so you
can understand what does it mean if you’re recalling a pacemaker this is not
like going in and changing out a faulty airbag. This is in your chest for so this
so again if I’ve not got you worried yet this is real. This is just one particular
device. All many other medical devices many energy devices there’s all kinds of
vulnerabilities out there that need to be protected against. In this as more and
more things be connected and it’s more and more become subject pack. Next slide.
Okay, so I was so worried about all this. I went to the White House and talked
about it in 2015. And discuss it with the Office of Science and Technology Policy
and the executive office of the president pointing out saying you know
things are bad and they’re getting worse in fact it’s a disaster if they are not
if this is not addressed. Next slide. So to get through this conundrum this
challenge of many many interconnected systems devices and resources that
include a variety of vulnerabilities. If you have no map, they’ll never get there. So we need to be thinking about how across the internet of things of many
many different ways of interconnecting devices and resources can
lead to vulnerabilities because we’re seeing the hackers have incentives to
find their way across these networks of networks and networks of devices and
resources. There are ..whether is for a short sell, whether it’s a true cyberattack,
whether it’s for theft, whether it’s industrial sabotage. There
it’s not… you cannot make this assumption that it’s alright for things to continue
on the pathway are for the Internet of Things. Because there are many many well we just know there’s malicious humans out there and there’s a malicious non
person entities. So I’ll pause on that phrase. Probably not many have heard the
term non-person entities before but that’s a US Department of Defense term.
For everything that’s not human. So it could be an application, it could be a
device, it could be a document, it could be a video, it could be hardware, whatever
it’s an entity a nonhuman, non-person entity. So our model we’ve been with
we’ve been following with all kinds of different players it counts you need to
count for everything because we know bots are out there we know there’s a
malicious human. You know there’s a malicious applications and if we’re not
organizing our everything we do to try to address all of those vulnerabilities
and we’re by definition we’re leaving doors open or windows open or
vulnerabilities there to be exploited. So this when I show this slide you might my
usual joke is its self-explanatory but okay well we’ll pause for a moment here
but I promise I won’t make it too painful but what we’re talking about is
a model. Well I will say this, I’ve never said this to people but I did say this
in the White House two years ago. So this is a model of everything of everything
exists in the physical world and the virtual world is in this model. Okay yeah that’s a pretty a bit academic
enormous model but let me say that again nothing exists in the physical world or
exist in the virtual world or can exist in either that is not in this model. So
for cyber physical security going forward whether it’s exactly this model or
something like it you need to start from a comprehensive view of everything.
Physical and virtual and all this possible interconnections because that’s
where the vulnerabilities are so this with this model we can think about
a new form of software which we call Edgware that connects again from edge
devices to the cloud and can be used to wrap together and protect devices
infrastructure content us humans and other non-person entities with his work
that we’ve been evolving here at Syracuse University with a National
Science Foundation partnership for innovation and other programs for many
actually 15 years this is a result of over 15 years of research which is
evolving to. Next slide. To blockchaining the Internet of Things. So I think a lot
of people including many of my colleagues we’re wondering like what is
Lee so obsessed about. What is he doing? Well now you can see with the
vulnerabilities of the Internet of Things and blockchain technology we have
we can talk about a way to tie the things to a watching in a secure way
that will integrate in automate the human machine interaction and machine to
machine interaction and an Internet of Things payment network or an machine
economy. So we’re evolving of this work going forward still and there’s early
commercial examples of some of the technology and applications which will
be actually waving it around a little bit later but one possible example just
be you know firmware upgrades across devices and networks where you’re not
sure you don’t have full confidence and all the other underlying networks or
resources you can still trust and create new applications in a secure environment
from cloud edge. So we’re showing a picture that volcano I was talking about
or showed in the opening slide, the man there at the top has on his back a backpack
that’s like this we call it an Internet backpack it was used last summer and
emergency response. So Joe the backpack here comes in okay now turn to the
camera we’ve comes with a number of different
devices smartphones of a satellite antenna these uh pro 10 is oh yeah okay.
Now it’s up so you can communicate across these little these few
devices you can connect across 11 different networks including from
satellite including from the top of volcano including including in the worst
case scenario disaster. So no matter where you are in the world matter what’s
happened no matter how bad the cyberattack is there’s another way we
provide to communicate. So this technology has had been trialed and is
in live use in multiple countries now including new york city schools and by
the Goma volcano observatory me go home uh next to the nasty-looking volcano
for the obvious reason that that is a very dangerous place to live and having
improved emergency response for that community with limited current internet
access is a is a clear and present danger. Next slide, okay. So that this just
mentioned the congo already that same technology i include here is with the
president of like the former President of Liberia, Ellen Johnson Sirleaf, who won
Nobel some years ago. She has his setup and had it installed on her farm on on
Christmas Eve, actually. Got it fully installed for her neighboring community
and school there so now it’s possible to connect and have connectivity from the
remotest point wherever there is lacking communications
capabilities from any rural area or in a disaster depending on the circumstances
if you look to the slide the picture to the right I had to sneak in with a
selfie wearing a SU orange cap with you can see the Nobel prize I don’t get
in selfies with the Nobel Prize winner very often. But I happen to be at that
event, in September, we’re working with the new president George Ria’s
administration now to discuss further deployments and use of these Internet of
Things, internet backpack systems, in Liberia. We’re also in discussion
preparing to blockchain the internet backpack and its multiple networks. So in
discussions with others including the internet Engineering Task Force and the
internet society and colleagues. So we’ll have further demonstrations and I know
that we’ll be talking about this more you’ll be hearing more about this as we
move forward we have an events coming up with a Fordham University, in April, on
blockchain and the future where I’ll be showing and and at in Toronto with
Harvard University, in May .as well so we’ll keep your eyes on Syracuse
University and iSchool news and they’ll be further updates as this moves
forward I should emphasize how much Syracuse University and Syracuse
University students have been part of this. There are several dozen iSchool
students in the digital transformation collaborative and with -consult that
have been contributing to and exploring this work been undergraduate
capstone projects. Tim Kelly and the are on the right handing the backpack to the
president is a SU alum as well and so there’s a but this involves many many
more colleges and universities and companies around the world. This is just
highlighting one particular application of the Internet of Things that is
coming along and is real ok. So that’s one space another one that sort of
overlaps I mentioned the utility grid and the electrical grid.
We’re looking at so many all those Internet of Things vulnerabilities I
talked about now think autonomous cars, now think a manufacturing ,or industry
4.0, now think about the home health devices and monitors and and robotics
everybody’s talking about all this. So I took out some slides in the interest of
not overloading you all but if we have some robots here. So I’ll talk about I’ll
just use a slide and I’ll go back to like what exactly this picture is about
about so you can think about good bad and evil robots. A good robot is actually
one I don’t you know maybe it has it has ethics but it also has secure protection
so that it can’t be turned against us or its owners or its users. A bad robot
would be like that eighty-four percent of Internet of Things so look robot is
just another internet a thing it’s applies the odds are it’s gonna be
attacked or in fact we know it’ll be attacked so if it’s like most if it’s
built to the same software quality standards and I’ll be a little
insulting here a sloppy Silicon Valley new startup don’t get it out fast not
worry about whether it’s safe not follow some software design best practices.
Worry about all of the information assurance that you would need to take
them for any quality system to be designed then you’re gonna have evil
robots because they weren’t designed they could be evil because they were
designed by evil people or it could be just a bad robot that’s been taken over
and remotely turned against itself. So this in terms of things to worry about
again we’re not we know if you don’t know how vulnerable Internet of Things
is and again that’s data that I was sharing earlier these are real concerns
we can’t just talk about the happy talk of how great autonomous cars and
autonomous vehicles are when we we know were the very first things the first
versions were being remotely hacked and hijacked from the second they got onto a
test track and a million and half vehicles were having to be caught.
So we have some real serious issues here that need to be thought about and needs
to be addressed and if we just leave it to the usual best practices quote unquote and I’m Silicon Valley that’s not going to be nearly good enough for what we
need. We do search, we need new capabilities. Even if you don’t buy my
models. There has to be some way to do better than what we’re doing and this
model here. This is something for I’m proposing to my colleagues here at
Syracuse University you know we’re sort of planning on this having multiple labs
like this where students you know who should figure out how to do this better
students should. Students should be playing with these robots with these
autonomous vehicles monitoring their interactions monitoring to earlier
electrical use how does secure transactions across them this is what
we’re about here at Syracuse in the iSchool giving students opportunities to
explore the very leading edge and make real contributions here. Whether it’s
through classwork or experiential learning and that’s exactly what you’re
looking at is a picture of a proposed student lab that would mimic what a
secure Advanced Micro would look like so if you’re gonna engineer properly
advances to the electrical grid in Puerto Rico or anywhere else would be
more or less doing exactly what we’re talking about here. So that’s actually
something that can be implemented on the scale of a classroom a desktop or a
little larger than that and students themselves can start helping solve these
problems that maybe now they’re creating or we’re creating as we move to this
internet of things I say and if we do it without blockchain how bad is it going
to be. It’s gonna be worse. So we need to be thinking about block chaining many
many of these systems to ensure that they can be trusted and secure and not
subject to mint cyberattacks and vulnerabilities. Next week. So I’m getting
into conclusions where I want to make sure we have time for discussion and
what we’re highlighting here is the many many new markets and opportunities that
are coming from the blockchain technology and distributed resources
whether it’s new trusted markets new capabilities beyond just cryptocurrency
using these intersessions and capabilities in many different vertical
markets. It’s also creating new needs for education and in the new for whether for
businesses and firms and for universities like Syracuse University.
I’ve already I think we convinced you that blockchain… the Internet of
Things without blockchain and I say Edgware can be evil we know can be very
dangerous. So there’s just a need as we as all these technologies go forward
something like cryptography that was kind of esoteric that we could a was a
specialized topic we all of us need to at least understand what its
capabilities are and how it’s being utilized and many many more people
should be getting education whether it’s Syracuse University in the iSchool at
all different levels. Some of you may be interested in a certificate or returning
for a master’s we would certainly welcome that and we certainly welcome
support and for research and innovation. I want to just sort of highlight one
more thing in terms of the novelty here. We have JD mentioned already that
Syracuse University is well this is the first watching management course offered
at any university anywhere in the world. There are courses on cryptography
there’s other courses that cover some aspects of blocking but actually how to
manage these resources these technologies for enterprise Syracuse
University iSchool is a first one to be offering students that capability to
get hands-on experience across blockchain systems as part of their
undergraduate and graduate education. Well we look forward to staying in that
position and carrying forward even if you’re not able to come to campus. I’ll
do my last product placement for this. Is a Mike colleague and co-author a
co-teacher Richey Edwards book a blockchain trust
companies this is you don’t have to come in as you can just order it on Amazon.
This is very accessible it talks about the future of blockchain.
How it can impact and create new business opportunities the subtitle is
every company is at risk of being disrupted by a trusted version of itself.
So when Richie’s not with us co-teaching, he’s a the chief digital
officer of IQVIA the largest healthcare data company in the world. And so you can
guess his very involved in thinking through the very many different
applications into healthcare and pharmaceuticals and the biomedical feet
of blockchain technologies. So I think I’m leaving ample time for discussion
and dialogue of you which is what I wanted to do. Last slide, I wouldn’t be a
proper academic if I didn’t assign in further readings. So the top
reference is to Government Accountability Office report on the
Internet of things. Again 2017, I was one of the invited experts it contributed to
the dialogue, in 2016 ,in 2017 but again maybe I’m biased because I contributed
to it but that chart I showed earlier was sort of essentially adapted from
that to be honest. I think the best look at Internet of Things technology that you
can find of there’s many many different reports from all kinds of consulting
firms but just like with blockchain technology or crypto currencies there’s
a lot of people that only have incomplete or partial understandings.
That’s the best overall view of Internet of Things technology. The next reference
is to a paper that Richie and I contribute to on blockchain and IOT. So
essentially, if you wanted to hear more on exactly what we talked about in this
seminar now, this webinar. There is a paper that we presented last fall.
Talking about trusted Commerce policy in this intersection the blockchain and
Internet of Things. So that’s the place where you can sort
of dig deeper and then the last one is okay now if you like that volcano or you
want to know more about what we’re doing to bring essentially innovation to some
of the countries which have the most severe limitations right now but on the
their hand are open to innovation we have the paper of getting
there from here in 2020 in the Democratic Republic of Congo. We are
doing similar work with library and other African nations which are open to innovation such as the internet backpack, such as a block
chaining Internet of Things. We’ll have probably have another announcement for
an event in late March where of the internet backpack and Syracuse students
i-consult students will be contributing to a live event across second 7 Nations.
So we’ll keep you posted on that as well if you look back to the su news site in
the future. Thank you very much forward to any
questions you might have. Oh great, thank you very much, Lee and I
think we’ve got a lot of questions here so let me just dive right into them. We
have first one is somebody is looking for how they get more information about
how they as a student or as a professional can work to fix the issues,
the security issues right all the known ones and the ones we don’t know about
yet. So that’s that’s a great question and there’s a lot of
the good news is there’s a lot of resources out there. If you’re out there
as a professional there’s a certified information system security professional
or CISSP certification program. That’s just one I’ll mention offhand, that’s
that’s really good and whether it’s so you there’s possibilities to start
attending you know industry events working on a certification process or if
you’re able to whether it’s Syracuse University in the iSchool or other
universities wherever you are. We have a whole for a curriculum. Oh, so if you’re a
graduate and looking just for a short program take getting a certificate in
information security is also an option. So there’s many many possibilities but
if you that’s exactly what I’m saying is we need many there’s a
shortage of over a hundred thousand people. There’s a hundred
thousand jobs open for people, that I’m kind of people I’m talking about. And you
know what you get a good salary. If you take this further education so anybody
out there thinking about like what should I do next be part of the solution.
That’s exactly what we need we need more people stepping up to help solve
this. Another question so when you had
mentioned the sloppiness in Silicon Valley. Yeah? How do you get
things to market them, if you’re too slow and you miss the window of opportunity.
Yeah, so that’s the the dilemma is like how do you be
disciplined. So if you’re doing things to military-grade secure androids. We all
know notoriously how slow an over budget and you know prone to delay you’re
getting like last generation technology out. So that’s a very fair concern. Now we get
to the, however, if we go back to that chart about blockchaining. Well, can we flash to that? No. Okay well, so you all can
remember that chart. So essentially, if you’re using, we also have new cloud
management courses. So, if you’re doing things properly with a
software-defined data. Essentially, if you’re following best practices like the
National Institute of Standards and Technology, like working with VMware,
IBM, some of the big players. How often does Google clouds
you know datacenters get hacked? They don’t get hacked because they have
really good practices. So it’s possible to do it really well with best current
practices. We have courses on that as well so if you design the proper clouds
they will follow the best practice is stay within that environment. It’s
possible to maintain and produce quality product quickly but it just it’s true
maybe a little easier and it’s a little faster and not everybody’s skilled on
this kind of current best practices but if they’re not and you’re rushing it out
and then it creates a new vulnerability then that’s still not, that
shouldn’t be acceptable. So actually we’re working on things like which will
be out a lot. So some of this stuff will be literally criminal. I think it’s
criminal to be putting webcams I can’t have their security software ever update and literally there’s systems are into
the are US grid right now. And there’s a draft law, as 1691, to make it illegal for
them to purchase that. So, some of this stuff is just bad and prohibited and
it’s gonna be bad corporate reputation if you’re the
producer of any of that stuff. Okay, so can you – can you
give an example of an application of both blockchain and machine learning? Okay, let me say because
of the money around cryptocurrencies that’s obviously in the first area of
application for blockchain technologies. So most of the there aren’t that many
you know true applications that are out there live in the field at this time
beyond the cryptocurrency space. There are project where, I guess. I’ll put
this one in, so here’s the current, the biggest one, I can think of
right now would be IBM and Maersk for shipping logistics, where you know you’re
taking advantage of Watson and sort of monitoring all.
Everything you can learn about the supply chain, the documentation of all
that. It’s that was just that they’ve been working on that since 2016.
So it’s passed pilot and just going to so it’s not yet commercially available I
think it was just announced within the last month. So I think that would be a
basically leveraging machine learning optimize shipping supply chains.
Go back over to the Internet of Things and connected devices for a minute so
what happens is you know if you’ve got one device in a network that becomes
compromised. Shouldn’t we be thinking in terms of work over and above the
components within the network? Yeah, so I didn’t spend as much time on
that open specification model as I could of. But a lot of that was worked out with enterprise cloud leadership councils or
essentially the wall street CIO of the banks and cisco in several years ago. As
they were thinking about bringing your own device and the vulnerability. So
let’s just take this device as an example, do you know what I
downloaded last night? I know what you did. Am I am going to infect and take down Syracuse University Network? Well, you know what. Working with those banks CIOs we helped figure out how to do that. Where you can just sort of assume .. Let’s assume I downloaded something I shouldn’t. Okay let’s assume, Syracuse University, we know this actually, the Syracuse University network
is safe but I’m not a coffee shop. We can probably assume that network has
somebody monitoring or somebody trying to steal passwords or something on it. So,
I got my device I’m in a coffee shop and I’m connecting to Syracuse University. So
we’re going from an insecure device. We have to assume the device is compromised. We have to assume the network is compromised and if we are to take things
properly you can still do exactly everything I just said.
You can still deliver the first users, the first people beneficiaries
where you know. First things first the billionaire, so the billionaire is able to move 25 million dollars from their compromised cell device over compromised networks. That can be done, that is being done that’s your own you’re doing it already and the
enterprises assume there are these vulnerabilities. They know it and they
also know that their own systems. So just assuming you have some external barrier
and you’re gonna keep all the bad things out.That’s not the way people, things
manage, you assume you have to be monitoring again. Using machine learning
you have to be monitoring your network and your devices all the time. In case
they start doing funny things like US and websites. I didn’t actually include this but this is the perfect example 5,000 US government
websites and UK government websites if you went and clicked on them to check on
your disability information your device would be helping mind cryptocurrency.
So this again to make a real example, this is real news, this week’s news of
vulnerabilities tying Internet of Things and cryptocurrency together. So, it’s
US government and the UK government. So there’s a many vulnerabilities. If
it’s properly designed you can sort of wall off and prevent one infection resource from compromising everything else. And here’s one thing I’ll say about this
device how far away does this phone get from me ever? Not very far. How far is
your phone ever from? Not very far. Okay well we may not trust the device but the
device ID being tied to Lee McKnight personally. You know what I’d have a
pretty high confidence in that connection
just because my jeans, my wallet I might lose those these days but
nobody’s losing these things for very long and they’re in a complete panic because
it’s like your whole life is tied to it. So this identity information is
very significant and can be used as an anchor to help tie and things even across insecure networks and devices. For this next question we’re
gonna go way back to the beginning of your presentation more about
the anonymity around blocking. So, how can blockchain technology track users well
at the same time keeping them anonymous? So there’s many remember–
they’re just 1,500 different crypto currencies and there’s many other
blockchain implementations. So, there’s no way– I can’t pretend to be an expert on
all of them. I’m not not even close and there’s many
different choices of how they’re implemented. So let me just go one rewind
to the proof of stake and proof of work block chains just for a moment here. So a
bitcoin the first blockchain technology for cryptocurrency and you’ve
all heard about the miners. So what they’re doing is solving very complex
math problems which earned them a new- if they solve it first or if they ever get it. So
there’s sort of a risk/reward ratio there that leads to a new resource. For
other crypto that’s a proof of work. So you get to, our new Bitcoin is
created by doing that by having the processors hijacking everybody else’s
machines and solving these math problems. You could have a proof of state
blockchain like the Maersk and IBM one. So if you’re not Maersk, if you’re not
IBM, if you’re not a registered shipping company, if you’re not the customs agents,
you can’t get into that chain you have no proof of stake you have no identity.
Remember what was just saying about identity. So if you’re not a secure registered
identity. There’s no way in. You have this super secure cryptography that makes it
impossible to get in. So, within the space of proof of work or
even crypto currencies are proof of work and have other mechanisms. So there’s a
variety of options here. Now getting that so that’s why say in the in the proof of
stake one you know everybody’s identity it’s not anonymous at all. Everybody-
every single identity that’s in is registered and known or you can’t
get in. The Bitcoin example is it’s designed to be anonymous and we
however if you move over $10,000 a Bitcoin in the US and you don’t tell IRS or the Treasury your money laundering and you’re going into jail. However, if your’e in New York State and you’re following that bitlicense
regulation and you’re buying and selling crypto currencies and you didn’t
register. You’re violating the law. So it’s not anonymous. It’s just
mathematically possible to be anonymous but whether it’s legally possible is
depend on the individual jurisdiction and then it also depends on the
technical implementation whether you want anonymity. So the original the originators
we’re looking to create this new anonymous free of government space and
that’s not really what’s evolving. It’s there’ll be many more regulations
whether it’s either banned like India, China, South Korea. So
basically the crypto currencies are becoming less anonymous and it’s more of
a myth about that. Because people who believe that– again some of
those one of the first Bitcoin foundation being board members went to
jail for money laundering. So don’t do anything dumb but basically if it was
illegal before Bitcoin it’s illegal with Bitcoin or crypto currencies. So looking
at the blockchains that are currently being developed for specifically with
the internet of things. Do you see any promise with the ones that are out there
right now? Well there’s sort of an early stage. There is a a micro grid blockchain I’m thinking of for a
new project but I can’t say that there’s a laundry list of ones that I say
that are ready to go. I’m going to a dinner
in Washington next month with Google, Facebook, Amazon all kinds of federal
government officials talking about again but this energy and Internet and secure
communication space. So with all the disasters in – and I’m also interacting
with New York State and other officials. Just because of the vault
bullies of the electrical grid and the utility grid. This is apart from an academic discussion looking at block chaining solutions
to these of communications and energy grid vulnerabilities that’s a real
dialogue being held at a variety levels. As I mentioned, there’s already some
legislation passing forward and there’s a number of different blockchain implementation that might be tied to that. We could be
different examples but it’s a little too soon to say how it’ll shake out. But we
look forward here at Syracuse University and the iSchool contributing to test beds
and real examples of ways to resolve some of those vulnerabilities. So just by
registering IOT devices on to some kind of blockchain somewhere how does that
provide security for them if the security flow still exists. Wouldn’t they
still be able to hijack? Okay so getting into like fine details of the architecture so you could be depending
on how we’re gonna showing off this up chambers and then the internet backpack
you are architecting that now and we’ll be demonstrating that in the coming
months. So there is a the depends on where what do you think about the
communication so if you have an insecure system but it’s it’s tied to its
identity there you know the identity of device right. So if you have that
identity information that typically like that sort of comes from its origins. So
if you have it’s like pre-existing identified information that you can
trust and then you’re concerned about the data coming up off them. You could be
preventing that, you could be either saying you can’t like just like with the
blockchain saying remember what I just said if it’s inauthentic information the
blockchain itself could say okay that it looks like this device or some things
behind it have been hijacked and with machine learning or other process is we
do not accept that transaction. We do not let that record to get
onto the blockchain itself. So that actually keeping things off the
blockchain that we can see that works or you wouldn’t have the
crypto currency markets as they exist today. We can say that’s verifiably true
that we can keep those transaction secure. It’s also
true that we can’t
automatically resolve all of the device vulnerabilities. If they haven’t been for
legacy devices all you can do is sort of wall them off and sort of manage and
monitor them and then for the next generation devices you can design them
better where they’re sort of blockchain inside as a part of a secure information.
I guess supply chain data and information supply chain that would be
less susceptible to vulnerabilities but that’s looking to the future. The present
we can do this better manage and protect ourselves versus letting things gang up
and attack us like we do now. So I think this is going to be the last
question here. We’ve only got about a minute left so your answer is gonna have
to be pretty quick but I think this one will lend itself to it. What do you think
are the areas that show the most promise for this technology right now? Healthcare
appliances, or all the industry’s kind of have a lot of opportunity.
Yeah, so this is a my sincere — I’ve mention starting
off. I’ve been to a lot of innovations and this is a very big one. This is going to change everything all industries will be different with
blockchain over time. It’s just at this early stage where most people have
just been looking at the very first area of application around finance. So I think
supply chain healthcare energy of entertainment, any
human activity. I expect blockchain technology will have more
trust between humans and information systems. Do we need that? Yes. Where do we
need it? Everywhere. So I think it will be everywhere over time. Now
where is a transaction cost and there’s ways to do this badly. It’s going to
get early a finance, healthcare, the energy already mentioned. We know
it’s being played with for many many other applications. Our own Syracuse
University students have been using blockchain also for trading and
monetizing game coins. So it’s already getting success in entertainment and
gaming among’s other areas. So you’re gonna see this everywhere and I
appreciate you all joining and participating in this webinar.
Thank you very much. Great and thank you very much Lee and with that, that
concludes our webinar. Thank you all for joining.

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