Offline Transactions
There has been an ever-growing shift in the digital trading markets to move from online to offline transactions, which would provide exchanges with better tools to defending themselves from online hackers. These offline transaction solutions for cryptocurrency don’t just create an additional layer of security, but it also could enable for complete censorship on cryptocurrencies. Traders alike would gain the capability to record, validate, receive or send digital currencies without an internet connection. Subsequently, this could be a critical factor in the global adopted of cryptocurrency. Right now, multiple firms are creating offline digital exchanges, which will act as a parallel option to centralized networks. One of these firms is GK8, an Israeli Startup that has rained $4 Million towards the development of their offline solutions.
Acquiring this level of censorship resistance was never the plan for cryptocurrencies like Bitcoin. However, Satoshi Nakamoto never anticipated that there’d be an influx of attacks of exchanges operating digital currencies. It’s prompted numerous individuals to request an offline solution. One way this will be accomplished is through peer-to-peer value transfers, which can take place through offline networks without the immediate need of a central bank. Momentarily, digital currencies maintain transaction immunity from government legislation. This is anticipated to change in the coming years, with the creation of decentralized offline exchanges, many provisions in the law can be avoided. Ultimately, higher leverages and safer networks are the results.
The government’s capabilities to censoring cryptocurrency are because multiple centralized exchanges work with banking institutions. This centralized control means that firms working under this business platform must accept and process the withdrawals of all clients through that banking institution. Right now, the government cannot stop people from engaging with cryptocurrencies, but they can enact regulations like the AML and KYC act. Unfortunately, the longer that digital currencies are operated with internet connections, the chances of censorship being exploited or hacks occurring regularly are still relevant. Luckily, firms like GK8 and many others are finding the solutions necessary to create a new financial industry without the engagement of governments.
The Failures of Internet Connectivity
As mentioned above, there are multiple failures when it applies to internet connectivity and blockchain technologies. Unlike conventional currencies which print bills, there isn’t any paper tender to Bitcoin or any other cryptocurrency. Subsequently, if there’s ever a situation where your jurisdiction faces a blackout, it’s impossible to engage with your accumulated funds. The increasing demand for government censorship by financial legislators could result in the permanent requirement for a global internet architecture with exchanges. An example of this would be the Venezuela 2019 Blackout, which saw bitcoin transactions decrease drastically.
Digital currencies like Bitcoin, Litecoin, Ethereum and Ripple, must face the upcoming onslaught of changes with climate change. The growing natural distances like Hurricanes or Earthquakes are causing for more power grids to go down regularly. Operating an offline network doesn’t solve the issue of battery power, which inevitably will die. This is why people have suggested Bitcoin ATM’s or Crypto ATM’s, which would enable traders to acquire their funds in a worst-case scenario. Before this level of adopted begins on a worldwide scale, multiple other retail and online industries must approach BTC with open minds. Regardless, these ATM’s would maintain backup generators in the case of power outages.
This level of adoption towards cryptocurrency wouldn’t just benefit traders in Europe or North America, but it would also enable individuals in rural areas worldwide to acquire decentralized payment changes. Two other firms that are working on the development of decentralized products include GlobalMesh and GoTenna. Both firms employ Richard Myers, an engineer working on decentralized applications. He’s often been on the side that MeshNet could benefit communication and facilitation of bitcoin transactions. GoTenna and GlobalMesh develop MeshNet.
Richard Myers stated: “In many parts of the developing world, internet connectivity is both expensive and intermittent. Solutions tailored to these situations would certainly facilitate the use of cryptocurrencies in places where it is needed. Bitcoin transactions can be made over alternative low-bandwidth transport layers like mesh radios and SMS.”
Multiple firms are creating products in connection with MeshNet or other networks operating centralized ISP’s. These projects anticipate that long-range radio wavelengths could provide the offline decentralized solutions everybody requires. However, many traders prefer P2P Infrastructure. Combining both centralized platforms would guarantee the government’s lack of involvement. The development of MeshNet is still underway today.
Wireless Mesh Network Archetypes
Mesh networks maintain specialized settings which enable infrastructure nodes to be employed in ranking order. The arrangements managed are different from internet architecture currently used. Internet centralized technologies require that severs relay information from one node to the other. When it applies to mesh networks, nodes don’t need to relay information and can self-configure through no central dependency. The Ranking Structure in a non-hierarchical design resembles the earliest iterations of the internet, and in some cases is also similar to the flat network topology of Bitcoin Blockchains. However, these mesh networks have always operated through a wired connection. This is slated to change.
There have been continuous advancements with wireless technology in recent years. This has enabled mesh networks to manage a wireless connection through their decentralized offline products. For some, this could be confusing, but the wireless connection is maintained through Bluetooth 4. Bluetooth wireless technology doesn’t require any internet connection. Other mesh networks use the satellite infrastructure, which enables for internet-free Bitcoin access on five continents. However, this requires traders to own a satellite dish instead of a phone or laptop. Regardless, using these two technologies, mesh networks can broadcast their trading services on an offline system. GoTenna plans on enabling a secondary option in the form of SMS Bridges, which will allow clients to engage with Bitcoin or other digital currencies without a cellular connection. It’ll be interesting to see which of these three archetypes become the standard with offline connectivity.
RotemFinkelman, the Marketing Communications Manager for GK8, spoke on offline cryptocurrency transaction solutions. He stated: The reason someone pursues offline crypto transactions is to prevent potential hacks and to steal the private key. The answer isn’t Bluetooth-Radiofrequency. It’s hackable by the fact that they need to be connected to the internet at some point to create a valid transaction. In that case, they still have attack vectors. If attack vectors still exist in the solution, then this technology isn’t the right archetype for offline solutions.”
Haydn Franklin
