Bitcoin payments “a natural fit” in IPv6, ETSI report finds
As IPv6 becomes more widespread worldwide, Bitcoin is gaining attention from the influential groups that develop, set and promote IT technical standards. In the latest example, ETSI’s IPv6 Enhanced Innovation (IPE) has produced a report titled “IPv6-Based Blockchain.” It describes how new security improvements built into new Internet Protocol (IP) standards are suitable for blockchain-based payments and other applications. It specifically refers to Bitcoin’s original design as its primary example.
ETSI (European Telecommunications Standards Institute) supports the development and testing of information and communication technologies that eventually become official European (and global) standards. Started in 1988 and based in France, it has over 900 member organizations globally and focuses on wireless networking, content delivery, home/office, transportation and interoperability.
The 22-page long report is available in its entirety here. It begins by noting that Bitcoin’s original design in 2008 included IP-to-IP functionality – something that was later removed from the protocol due to the security deficiencies of IPv4. Although IPv4 is still widely used, IPv6 has gained momentum over the past decade, and its growth could herald a resurgence of blockchain-based applications.
Benefits and use cases
The report mentions that IP-to-IP functionality can still be used in IPv4, where unique IP addresses are available, by using security features in existing frameworks, such as DNSSEC (Domain Name System Security Extensions) and TLS (Transport Layer Security) certificates . However, it is the transition to IPv6 that will ultimately unlock these benefits for all users and all devices.
To the general public, the most recognizable feature of IPv6 is its large supply of IP addresses—an almost infinite number that will guarantee unique addresses for every user and device, large or small, across the entire Internet. IPv4’s far more limited address range has made unique addresses scarce and valuable, with most users acquiring addresses via temporary measures such as Network Address Translation (NAT) routing and address sharing. This, and IPv4’s lack of built-in security features, made the original Bitcoin’s IP-to-IP functionality impractical and far less secure.
Each IPv6 address is cryptographically generated. This becomes a self-authentication measure to establish secure communication between parties, or to generate unique “session keys” for individual Bitcoin transactions without the need for private/public key exchange.
“It is clear that Bitcoin payments are a natural fit with cryptographically generated addresses,” the report said. Application software may identify whether a user is using IPv6 and/or running Bitcoin and use this information to initiate a secure channel for messaging and payment transactions. The report also describes how a Bitcoin payment can be sent directly to a domain name if it can be resolved to an IP address.
It then describes several other practical use cases where Bitcoin/blockchain transactions would be beneficial. They include:
* Web server access – a client wishing to access information on a particular server may be charged for the amount of access, most likely using micropayments.
* Local link payments – where a user can send money to someone physically nearby if they have internet access on the same network.
* IP Messaging – the ability to send secure and private messages (email or otherwise) directly between parties, which may include payments.
* Transport terminals and fares – the report describes pre-paid and pay-as-you-go journeys where a traveller/commuter can interact with station terminals to make direct payments.
There is no need for any Bitcoin-specific functionality to be included in new IP standards – instead, Bitcoin was designed to leverage existing IPv6 functionality. The main goal now is to ensure that IPv6 becomes the Internet’s most widely used protocol. This will eventually happen out of sheer necessity for more addresses, but if users and administrators understand the added benefits of secure payments and messaging, IPv6 will see universal adoption much faster.
Watch: Dr. Craig Wright is at IIT Kanput and talks about Bitcoin and IPv6, P2P exchanges enabling an Internet of Everything:
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