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What happened with West Virginia’s blockchain voting experiment?



Illustration of a blockchain over a map of West Virginia.

Picture illustration by Slate. Pictures by Getty Pictures Plus.

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Final yr, West Virginia did one thing no different U.S. state had achieved in a federal election earlier than: It allowed abroad voters the choice to forged absentee ballots for the midterm election through a blockchain-enabled cellular app. In response to Voatz, the corporate West Virginia labored with, 144 people from 31 nations efficiently submitted ballots through the app for the November election. Earlier than that, there was a smaller pilot of the system in two West Virginia counties that Might.

West Virginia billed the experiment as successful and says it plans to make use of the know-how once more in 2020. Voatz has already made offers with different native governments within the U.S., most lately for Denver’s Might municipal election.

However how safe and correct was the 2018 vote? It’s inconceivable to inform as a result of the state and the corporate aren’t sharing the fundamental data specialists say is important to correctly consider whether or not the blockchain voting pilot was really a powerful success. With 2020 looming, that’s troubling, given what we now know concerning the extent of Russian incursions into our election techniques in 2016.

State officers in West Virginia mentioned the purpose of rolling out the cellular voting choice was to make voting simpler for troops residing overseas. However West Virginians abroad didn’t should be within the army to reap the benefits of the method. All residents needed to do was register, obtain the app, undergo just a few verification steps corresponding to importing a photograph ID and taking a video selfie, and make and submit their poll alternatives on the display screen. And all of it was mentioned to be safe. With the blockchain know-how it used, the agency insisted, the votes can be near-impossible to hack. (Blockchain is a digital public ledger that information data. It may be shared and utilized by a big, decentralized community, so it’s theoretically extra proof against tampering.)

However quite a few election know-how specialists sounded the alarm over what they mentioned was the big potential for glitches and safety dangers on folks’s cellular gadgets, the networks that hosted them, and the servers that held their data. Amid the phrases and phrases they used to explain West Virginia’s experiment: “horrible,” “horrific,” “utterly nuts,” “high-flying blockchain guarantees,” “the Theranos of voting,” and “no.” Some pointed to the shortage of transparency across the app, others to the inherent weaknesses of conducting an election over the web in any respect.

Our closest take a look at the small print of the voting experiments got here in an eight-page white paper revealed in February, but it surely was quick on particulars. Within the report, Voatz mentioned that it had retained 4 unbiased safety specialists to audit its system. Although the white paper included “enjoyable details for election geeks,” it failed to call any of those auditors. Additionally unlisted: the scope of the exams performed, what precisely the auditors had entry to, how lengthy they needed to carry out the exams, what vulnerabilities had been found, the severity of these vulnerabilities, and whether or not or not they had been fastened.

When requested about why a redacted audit or report from the auditors wasn’t launched, Voatz co-founder and CEO Nimit Sawhney, who co-authored the white paper, gave a number of causes. First, he pointed to a nondisclosure settlement with the auditors. Then, he said that there was no strategy to share any extra details about the audit with out revealing proprietary details about the system. However one would count on a redacted report and even an summary of the report for transparency’s sake, given the stakes of introducing a brand new system to our already rickety voting course of. Relying on the secrecy of its system structure is such a poor safety mechanism that researchers have even coined a time period for it: safety by obscurity.

To its credit score, Tusk Philanthropies, the group that funded most of Voatz’s cellular voting pilots, contracted ShiftState Safety to conduct its personal, separate audit and to overview the opposite audits and penetration exams (the place auditors search for safety vulnerabilities that attackers may exploit). ShiftState Chief Safety Officer Andre McGregor instructed me that the agency deployed “a few consultants,” together with himself, over a month to conduct a full safety overview, interview Voatz workers, and see whether or not penetration exams performed by one other agency had been in keeping with the outcomes one would count on from a pen take a look at of that sort of software program stack. McGregor mentioned Voatz “did very nicely” within the audit. However he declined to reply a number of questions due to a nondisclosure settlement he had signed with Voatz. After Voatz Senior Vice President Larry Moore instructed me that the corporate would launch McGregor from his NDA, McGregor said that any interview questions would must be despatched through e mail, however he didn’t reply to these.

Voatz’s lack of transparency makes it onerous to verify if votes had been tabulated precisely. A very powerful a part of conducting a post-vote tabulation audit—a strategy to obtain confidence that reported election outcomes are appropriate—requires taking a random pattern of ballots that mirror the true intent of the voter. That is the place having a paper path from voting can come in useful. With machines that generate paper ballots or conventional paper-based voting, you’ll be able to maintain the piece of paper and confirm it earlier than placing it right into a scanning tabulator.

Voatz’s web site states that “a paper poll is generated on election night time” and is tallied “utilizing the usual counting course of at every collaborating county.” What meaning is the voter’s vote is shipped to the county clerk workers as a PDF, and the county clerk workers prints it out and places it into the scanning tabulator. These paper ballots generated from the PDF would possibly nonetheless be helpful to audit the tabulator itself, however not the voting course of, because the voter by no means had an opportunity to overview the paper instantly. This requires the voter to belief that the federal government will do all this appropriately behind the scenes.

“There isn’t something like that to verify if you’re utilizing web voting or cell phone voting, so there’s no method to return and be sure that the tabulation was appropriate and that it matches one thing the voter intends,” mentioned Audrey Malagon, mathematical adviser for Verified Voting, a nonpartisan nonprofit that advocates for regulation and laws selling accuracy, transparency, and verifiability of elections.

Voatz’s web site additionally says {that a} postelection audit can examine “the paper ballots with the anonymized voter-verified digital receipts generated on the time of vote submission.” However a carbon copy of a cellular or on-line vote is just not a paper poll, and evaluating that receipt with the outcomes is just not a tabulation audit. “With the intention to have an genuine tabulation audit, you might have to have the ability to audit one thing that the voter has been capable of confirm, and so any time you’re introducing these additional steps and further processes, you might have the additional potential for error,” Malagon mentioned.

Sawhney says that every voter receives a verifiable receipt of their vote and has the flexibility to verify whether or not it represents their intent, and an nameless carbon copy of the e-mail is shipped to the jurisdiction. The tabulation audits have been performed based mostly on the copies despatched to the jurisdiction. However what if the signature scheme is damaged or an e mail wasn’t correctly despatched to each recipients? “The one factor a voter can really confirm is one thing that the voter sees. If the voter is in a single place a voter-verifiable receipt and another person is in one other place a printed poll that supposedly matches that receipt, how do we all know that it really does?” requested Mark Lindeman, Verified Voting’s senior science and know-how coverage officer.

Voatz’s use of blockchain doesn’t remedy this downside. Advocates of blockchain voting level out that the blockchain is proof against tampering, which they are saying can shield the method. However anybody who has voted on this method would possibly wish to verify their vote within the blockchain to ensure it’s really there and says what they supposed. Though Voatz is hoping to vary this sooner or later, its customers at the moment don’t have any method of doing so. And producing paper ballots that the voters are unable to see or confirm is just not sufficient.

Even when Voatz does handle to construct a viewer permitting voters to confirm their votes throughout the blockchain, it nonetheless doesn’t remedy the issue of tabulation audits, the place utilizing random samples is a part of the purpose. And it’s not doable to establish whether or not carbon copies of voting receipts mirror voters’ intent the way in which paper ballots can.

Discovering a technical resolution that can enable voting techniques to indicate that what’s being recorded, counted, and saved within the blockchain displays the voter’s intent with out compromising the voter’s secrecy isn’t straightforward. That’s why many specialists assume that blockchain isn’t an applicable software for voting, at the least not but.

Voatz has promised extra white papers, and that future audits might be performed by third-party companies and might be within the public area earlier than 2020. If that occurs, it could be a step in the proper path. An audit of the vote in Denver was performed by the Nationwide Cybersecurity Heart, a nonprofit group established in a invoice signed by former Colorado Gov. John Hickenlooper, who’s the founding director and has a nonvoting seat on the board. The tabulation audit was, once more, performed based mostly on receipts. The audit itself was, at the least, extra clear, with an audit course of demo and video posted publicly, together with a Fb Stay video by the Denver Elections Division.

Extra audits by the U.S. Division of Homeland Safety are deliberate too, although it’s unlikely that the outcomes might be shared publicly in a significant method. Donald Kersey, normal counsel and former elections director/deputy authorized counsel for the West Virginia Secretary of State’s Workplace, mentioned that penetration testing might be achieved by the Division of Homeland Safety in the summertime and fall, and that exams will embody on-site inner intrusion makes an attempt within the fall. This can generate an audit report, however not one which’s public, although Kersey plans to summarize it for voters. When requested how voters can decide whether or not he’s cherry-picking from the report, Kersey mentioned, “If there’s one thing insecure, we wish to find out about it, and if it will possibly’t be mitigated, we’re not going to make use of it.”

“No person’s focused on placing out one thing that isn’t protected and lower than a sure normal,” mentioned Sawhney. “We consider it’s fairly strong and does what it claims to do.”

However “fairly strong” is just not ok in the case of voting securely. And with out seeing a correct tabulation audit or different particulars about the way it works, we merely can’t consider it.

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As blockchain hype subsides, banks count the cost of early euphoria



Banks and expertise corporations have poured billions of {dollars} into blockchain initiatives, however because the hype dies down, lots of the early evangelists for the expertise have come to the conclusion that production-ready deployment nonetheless stays a distant objective.

Analysis carried out by the World Financial Discussion board and Accenture involving interviews with 550 people and an evaluation of 79 blockchain initiatives has discovered little confidence within the skill of the expertise to match its early promise.

Survey respondents on common anticipated a 24% return on funding on their early blockchain initiatives, however realised solely a 10% return. Certainly, absolutely 59% of respondents mentioned they’d no confidence that the venture would ship a optimistic return on funding.

Certainly, a lot of the worth seems to lie within the reputational sphere, with 42% of respondents anticipating a noticeable or vital model enchancment from merely saying a blockchain venture.

A separate evaluate carried out by Reuters of 33 initiatives involving giant corporations introduced over the previous 4 years and interviews with greater than a dozen executives concerned with them discovered an analogous story.

At the very least a dozen of those initiatives, which contain main banks, exchanges and expertise companies, haven’t gone past the testing section, the evaluate exhibits. Those who have made it previous that stage are but to see in depth utilization.

Although many technologists and repair suppliers classify the expertise as and prepared for manufacturing, skepticism stays, notes the WEF.

Proof-of-concept initiatives are sometimes led by evangelists, developed in R&D, and all the time in managed environments. Transferring to manufacturing requires stakeholder buy-in and generally is a actual problem, states the WEF

Moreover: “It is very important understand that blockchain is in its early levels and there are limitations consequently. For instance, challenges exist in absolutely addressing safety, pace and effectivity. It is necessary for organisations to fastidiously think about whether or not there are different applied sciences or approaches to digitisation that will ship on their aims extra successfully or effectively.”

Editorial | what does this imply?

This content material has been chosen, created and edited by the Finextra editorial group primarily based upon its relevance and curiosity to our neighborhood.

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Blockchain: what it can do for you



I just lately attended a chat by SLA Europe on ‘What’s the Blockchain and what can it do for you?’ Shows had been delivered by Dr Aeron Buchanan of the Web3 Basis, Sally Connor of EY and Simon Drane of Earlsferry Advisory. Attendees comprised data professionals and authorized employees, all of whom had a various vary of curiosity and data in blockchain know-how.

Buchanan and Drane highlighted how decentralised consensus platforms (DCPs) can take the function of trusted middleman as a part of the contractual internet. Blockchain know-how boosts transparency, permits decentralisation, immutability and it might probably act as an automatic middleman in monetary transactions. For instance, computerized cost for late supply, flight delays, guarantee registrations and signing for items are advantageous capabilities.

The consultant from EY, Sally Connor, centered on the dangers related to blockchain know-how. Questions had been raised surrounding the authorized possession of information in a blockchain, management of a blockchain and whether or not a blockchain may meet regulatory compliance. Additionally, who’s chargeable for ensuring that the info going into the blockchain is right, dependable and correct? If we’re unable to switch or take away information, does this create a possible danger for a number of sectors? If the info entered right into a blockchain is inaccurate or inaccurate, what’s the potential impression?

There may be vital potential for blockchain know-how to streamline processes and enhance effectivity. Nevertheless, from the attitude of an data skilled, there are questions surrounding confidentiality, the quantity of information, the accuracy of information and immutability. Assurances are required over controls and the impression of blockchain know-how on the present and future workforce. The impression may very well be appreciable and dialogue surrounding adaptation, integration and the way forward for this know-how ought to contain the data skilled.

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Embattled Vancouver Blockchain Consultancy, Vanbex, Targeted in Additional Lawsuit | Crowdfund Insider



Vanbex, a Vancouver-based “blockchain consultancy” now contending with a proper fraud investigation and civil forfeiture actions, has been slapped with a civil lawsuit by a former worker.

In keeping with Enterprise Vancouver, lawyer Blair Hogg filed paperwork naming Vanbex Group Group, Inc., Vanbex Labs, Inc.  Vanbex Ventures, Inc., and firm founders Kevin Hobbs and Lisa Cheng as defendants in a swimsuit registered on the BC Supreme Court docket on June 14.

Hogg is suing Hobbs and Cheng alleging they misrepresented firm prospects, deliberately inflicted emotional harm on him, “constructively-dismissed” him after which defamed him in Vancouver enterprise circles.

Hoggs says he was introduced on at Vanbex in December 2017 as vice-president and basic counsel and was anticipated to handle authorized affairs, funds, and human assets.

Hogg says that agreed-upon remuneration was $200,000 a 12 months in in addition to inventory choices that Hobbs and Cheng allegedly claimed had been value a minimal of $2 million.

Hogg’s submitting additionally states that:

Mr. Hobbs and Ms. Cheng additionally made representations..that the Firms had been in severe discussions to construct blockchain merchandise for Anheuser Busch(‘Budweiser’), IBMCoca-Cola and Thoughts Geek, (and advised Hoggs) throughout employment negotitations that IBM thought of [Vanbex] to be the ‘Uber’ of blockchain and wished [to] accomplice with [Vanbex] to construct a set of blockchain merchandise.”

Hogg goes on to allege that these claims had been false and designed, “to induce him to finish the Employment Settlement, which he did, to his detriment.”

Hogg claims he went on to come across “a poisonous work surroundings” at Vanbex and that Hobbs and Cheng had been, “confrontational and abusive in direction of the Workers.”

Hogg additionally claims that he watched 44 workers give up through the 11 months he labored there, and that he was “constructively dismissed” when circumstances made it “legally, morally and professionally unattainable” to proceed working at Vanbex.

Vanbex has additionally been focused by a lawsuit launched by the British Colombia Civil Forfeiture Workplace alleging that Vanbex, Lisa Cheng and Kevin Hobbs carried out a fraudulent securities providing within the type of a $30 million USD ICO.

Vanbex carried out an ICO sale of “FUEL” tokens in October 2017 and raised an estimated $33,730,000 USD by promoting the tokens to the general public for ethers, tokens native to the favored blockchain community Ethereum.

On the time, ethers had been buying and selling for round $300 USD, however together with many different crypto tokens within the fall of 2017, the worth of ethers greater than quadrupled within the following three months, and ethers briefly traded for $1377 USD in January 2018.

If Vanbex cashed out at the moment, it may have turned a revenue of greater than $100 million USD.

Like different firms that raised cash by ICO in 2017, Vanbex characterised FUEL tokens as “utility tokens” individuals may ultimately use on a devoted blockchain the corporate was constructing.

One other civil lawsuit towards Vanbex states that the corporate by no means constructed that blockchain, however the Vanbex web site signifies {that a} platform known as Rocket is now dwell.

Cheng and Hobbs have reportedly had sports activities vehicles and a tony townhouse seized by the Civil Forfeiture Workplace and, in April of this 12 months, the Canada Income Company was additionally reportedly pursuing an investigation into Vanbex.

The British Columbia Workplace of Civil Forfeiture additionally claims that Hobbs used “misappropriated funds” from the Vanbex ICO elevate to purchase a Bay Road condo in Toronto for $3.74 million; to buy a three-year lease for a $500,000 2018 Lamborghini and, “to gamble…practically $1.82 million between late 2016 and March 2018 at B.C. casinos till he was placed on a watch listing and denied from buying-in at any on line casino with un-sourced money or chips. Hobbs additionally gambled internationally, based on the court docket filings.”

The Vancouver Solar additionally claims that Hobbs has a legal historical past.

In 2005, he was reportedly caught in a New York lodge room in possession of 45 kilos of marijuana and $178,000 USD in money.

As properly:

“In 2008, Hobbs was convicted in Nova Scotia of possession of property obtained by crime and cash laundering, a results of being discovered with $32,000 in a suitcase earlier than boarding a flight to Vancouver…(and was later) convicted in Nova Scotia for drug trafficking and unlawfully producing marijuana. He acquired a 30-month sentence.”

Hogg has additionally claimed in his swimsuit that Hobbs slandered him and hindered his employment prospects at a poker sport on the Vancouver Membership in February, the place he allegedly advised fellow gamers that Hogg “tousled” Vanbex’s authorized affairs.

Vanbex spends nearly all of its “Vanbex Company Replace: June 25, 2019” contending that the case by the Workplace of Civil Forfeiture is predicated on unreliable testimony from an ex-contractor.

Associated:Vanbex, Accused of Cryptocurrency Fraud, Fights Again. Information Lawsuit In opposition to Former Guide Alleging Defamation and False Statements

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