The Block Chain Ecosystem

2016 The Blockchain Ecosystem
Introduction
The blockchain combines cryptography &

distributed computing to deliver secure, direct
peer to peer transactions without the need for a
central party. At its heart is the Distributed Ledger.
This is a tamper proof, public, network-hosted,
record of all consensus verifiedtransactions.
Initially realised via Bitcoin & similar cryptocurrencies, focus & investment is now shifting to the
potential of blockchain technology to revolutionise the infrastructure & processes of established
Financial Institutions & other enterprises.
This Map summarises the key principles behind the
blockchain & the emerging ecosystem addressing
payments, banking & other potential use cases.
Payment Use Cases

Retailing
The Cryptocurrency Ecosystem
blockchain companies
to Oct 2015. $462 million
1
of this in 2015 alone.
$121million
805
30+
Remittances
Merchant
Payment
Processing
Merchants
Exchanges
Bitcoin Processing
Bitcoin PoS
Mining
Multiservice
Companies
Exchange
21 INC
- AntPool
106,000
Number of merchants who

accept Bitcoin 4
$4.9bn
Bitcoin capitalisation Nov 2015.

Bitcoin accounts for around
90% of the capital value of all
cryptocurrencies 5
$2.7bn
value of Bitcoin trading in Sept

2015 6
475
Bitcoin ATMs installed

worldwide 7
- Slush'spool
Bitcoin
The Distributed Ledger

Anatomy of a
Transaction
1 Initiation
sender
Transaction Instruction
-prior transaction(s)
-recipient address
-value & conditions
-digital signature
The Ledger
2 Verification
Consensus
Verified Block
Blockchain
1 CoinDesk & Crunchbase

2 Venturescanner.com reviewed Nov 2015
3 FirstPartner research
4 CoinDesk State of Bitcoin Report Q3 2015
5 Blockchain.info checked 16th Nov 2015
6 Bitcoinity.org
7 Coin ATM Radar checked Oct 2015
Contact us for in-depth insight

into your target markets!
Contacts
[email protected]
+44 (0) 870 874 8700
@firstpartner
www.firstpartner.net
www.firstpartner.net
Copyright FirstPartner Ltd 2015
IoT
Registering and validating

connected devices
Data
Distributed storage of and

access to business data
Distributed P2P
Networks
i
L
F VA
e-Identity
Litecoin
Consensus:
Latency:
Currency:
Issuance:
Registering and validating

individual identity
Other Use Cases

Data & Analytics
a
N
P IO
T
t
A
s
r U
Proof of Work
10 minutes
BTC - on and off-network
Mining Reward. 21M Limit
Prevents double spend or validation of fraudulent transactions:

Proof of work: miners compete to validate blocks by solving highly
processor/RAM intensive cryptographic problems for reward
Distributed consensus: majority validation by trusted subnetworks
of peer nodes within the network. Used by Ripple & Stellar
Proof of stake: achieves distributed consensus by network users
proving their ownership of currency. Used by Peercoin & Bitshares
Value
recipient
Validation:
Latency:
Currency:
Issuance:
AKA the Blockchain. A Public record of all

transactions - stored across a distributed P2P
network of servers. Verified transactions are added
in blocks and the history provides proof of value or
assets owned.
the
nodes or miners:
network
-propogate
-group into candidate blocks
-validate signatures
-verify through consensus
3 Completion
The medium for transaction settlement within the

newtork & rewarding miners. Cryptographically
generated, protocol rules detremine issuance &
destruction. May be tradeable off the newtork
(e.g. Bitcoin) or only exist on network (e.g. XRP)
Proof of Work
2.5 minutes
LTC - on and off-network
Mining Reward. 84M Limit
Ripple
Consensus based protocol designed

specifically for existing financial
institutions. Supplementing existing
processes & directly suporting fiat
currencies, lead use cases are
international paymemts & inter
Financial Institution settlement
Validation: Distributed consensus
Latency:
3 seconds
Currency: XRP on-network only
Issuance: At inception -100 BN units
created.
Ethereum
The R3 Consortium
Technologyy led
initiative of 30+
banks to design
& apply distributed
ledger technology to
global financial markets
Policy
Crypto 2.0 - Building

on the Bockchain
Encode & validate

conditions for a
transaction between
parties. Potentially
faciliate legally
binding transactions
over the blockchain
Bitcoins altered to
represent an asset.
Exchanged via the
Open Assets
Protocol. Allows
trading of physical &
other assets
Smart Contracts
Enabling Layers
Colored Coins & Open Assets
Core Blockchain Protocols
Stellar
Validation:
Latency:
Currency:
Issuance:
Doge - on & off-network

Mining Reward. Unlimited
Legal
Raising finance & distributing equity
Blockchain Benefits
- Ecosystem simplification
- Faster interbank clearing & settlement
- Lower transaction costs
- Reduced counterparty risk
- Transaparency & auditability
- Ease of software development/integration
Risks
Vs.
- Unproven technology
- Untested capacity/scalabilitty
- Low transaction speed
- Possible concensus prototcol flaws
- Cryptocurrency price volatility
- Uncertain regulatory status
Ripple: facilitating multiple

Financial Institutions focussing on
payment solutions
Consensys: building an
Ethereum based ecosystem &
partnered with Microsoft for
Ethereum Blockchain as a Service
Distributed consensus
2-5 seconds
Lumens on-network only
100 BN then 1% issued PA
Crowd Funding
Executing smart legal

contracts
Protocols,
platforms & SDKs
that build on
top of core
blockchain
protocols to
enable
additional
transaction
types & services
Protocol Commercialisation
Ripple derivative. Financial focus
Proof of Work
1 minute
Institutional Investment
Financial Infrastructure & APIs
Market Places
Trading & sharing of

physical & digital assets &
services
Publishing
Digital asset rights management, distribution &

payment
Balancingthe Benefits
Key Security/HSMs
Complaince
Interbank Networks
Card Schemes
Y
P
Enable implementation
of private Blockchains/
sidechains &/or the
development & securing
of financial applications
Smart contract & distributed app focus

Validation: Proof of Work
Latency:
12 seconds
Currency: ETH on-network only
Issuance: Mining Reward.
Dogecoin
Consensus:
Latency:
Currency:
Issuance:
Central Banks & Initiatives
National Clearing
The following major central banks have undertaken assesments or

issued statements on regulation, potential risks to financial systems
and/or benefits but none yet has a definitive policy stance.
- The Federal Reserve
- Bank of England
- Monetary Authority of Singapore
- Banque de France
- Peoples Bank of China
- Deutsche Bundesbank
- Reserve Bank of India
- European Central Bank
Securities & Derivatives & Asset Trading Platforms
Smart contracts
& blockchain for
transparent
trading & post
trade settlement
Open Protocols for

Institutions
Blockchain
Created as an alternative to central

bank controlled fiat currencies, Bitcoin
was the first working Cryptocurrency.
It remains dominant but lack of
scalability and other inherent flaws will
likely prevent mass adoption.
Protocol Components
The Currency
n
tr O
Commercial platforms &

services targeting Financial
Institutions
Bitcoin Based
Cryptocurrencies
- Ghash.io
- F2Pool
Like what you see?
Processing
Mining Pools
Liquidity Provision
Enabling the Financial Services Blockchain
Mining
Banks & Financial Institutions known to

be testing, analysing or investing in the
blockchain technologies 3
Richard Warren
[email protected]
Wallet
Mining Technology & Commercial Operations
of registered Bitcoin wallets in

11m Number
Sept 2015 - up from 6.6m in Sept 2014
r
e
Securities Markets
Trading & Markets
Regulated financial instutions & platform vendors exploring blockchain technology

as an alternative to centralised & correspondent payment processing
Retail & Commercial Banks
Money Transfer Operators
PSPs Supporting Bitcoin
Risk & Fraud

Management
Resilience
Market
Makers
Number of early stage Bitcoin &

blockchain companies identified by
Venture Scanner 2
Author
International
Remittance
BitCoin ATM
FirstPartner
Product
Launch
Forex
Established Financial Ecosystem
Specialist companies facilitating transaction validation, currency exchange,

storage & payment on existing cryptocurrency newtworks (primarily Bitcoin)
Bitcoin Debit Cards
Customer
Engagement
Proposition
Development
Interbank Clearing
Users
Largest cumulative
funding total - raised by
Bitcoin computer
developer 21inc. 1
Sources:
Financial Inclusion
Wallets
Blockchain numbers
VC invest$921million Cumulative
ment in Bitcoin &
Person 2 Person
Market
Insight
Investors
Proof of Ownership
Tamper proof registration &
stamping of physical &
digital assets

The Block Chain Ecosystem

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2016 The Blockchain Ecosystem

The blockchain combines cryptography &

Payment Use Cases

The Cryptocurrency Ecosystem

Number of merchants who

Bitcoin capitalisation Nov 2015.

value of Bitcoin trading in Sept

Bitcoin ATMs installed

The Distributed Ledger

1 CoinDesk & Crunchbase

Contact us for in-depth insight

Registering and validating

Distributed storage of and

Registering and validating

Other Use Cases

Prevents double spend or validation of fraudulent transactions:

AKA the Blockchain. A Public record of all

The medium for transaction settlement within the

Consensus based protocol designed

Crypto 2.0 - Building

Encode & validate

Colored Coins & Open Assets

Core Blockchain Protocols

Doge - on & off-network

Raising finance & distributing equity

Ripple: facilitating multiple

Executing smart legal

Ripple derivative. Financial focus

Financial Infrastructure & APIs

Trading & sharing of

Digital asset rights management, distribution &

Smart contract & distributed app focus

Central Banks & Initiatives

The following major central banks have undertaken assesments or

Securities & Derivatives & Asset Trading Platforms

Open Protocols for

Created as an alternative to central

Commercial platforms &

Like what you see?

Enabling the Financial Services Blockchain

Banks & Financial Institutions known to

Mining Technology & Commercial Operations

of registered Bitcoin wallets in

Trading & Markets

Regulated financial instutions & platform vendors exploring blockchain technology

Retail & Commercial Banks

Money Transfer Operators

PSPs Supporting Bitcoin

Risk & Fraud

Number of early stage Bitcoin &

Established Financial Ecosystem

Specialist companies facilitating transaction validation, currency exchange,

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