CME Has Plans For Development Of A New System For Easy Modification Of Blockchain Protocols

This Will Allow Blockchain Modifications

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A patent has been published by US Patent and Trademark Office (USPTO) on Feb 8, last Thursday. This is meant for a system which will allow for Blockchain protocol modifications usually without the consensus of all the network participants. Originally, the patent was filed in December 2017 by the CME group.

For a Cryptocurrency like Bitcoin which uses Blockchain-based networks, the modification of the protocol is highly reliant on the network consensus. However, this is something which is regarded as hard to achieve. This, in turn, makes the systems resilient and in turn very hard to upgrade when it is required.

The Segregated Witness Upgrade

The Segregated Witness (SegWit) upgrade, was designed in order to add to the transaction malleability but has not made the focus on the Bitcoin scalability. Therefore, this requires around 95% consensus to be activated whereas it took many months in the formation. Therefore, CME has been known to use an example of an airline frequent flier application in the demonstration of the various potential problems in use of Blockchain which is not easily modified.

In the case that an airline requires to increase the transaction fees as a result of the transfer of the airline miles or rather add the KYC/AML identity program, it requires each and every miner and node in the entire network of nodes for the approval of the change through the update of the software. If many nodes do not agree, then a fork in Blockchain happens which leads to unpredictable results.

CME in their patent proposes a “method for synchronizing rule changes in a system which implements a blockchain for transactions.” Once a processor then determines that there is a data message with a certain change on how blocks are processes to the blockchain and are valid, it then leads to a generation of a new block with information about the Blockchain operation change.

This data is then communicated to the other blockchain systems. Therefore, it means that all transactions after the specific block having the data for the operation change operate under the new rules. CME group has shown the vigor for innovation to work with Blockchain and cryptocurrencies.