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BlockCloud Review – Empowering IoT w/ Service-Centric Blockchain

Internet of Things (IoT) otherwise known as:

“the network of physical devices, and items embedded with electronics, software, sensors, actuators, and connectivity which enables these things to connect and exchange data.”

The current design of the internet has resulted in challenges that hinder the greater adoption of IoT and IoT devices. This challenge arose because communication channels were built with the assumption that communication would occur between fixed entities.

This limiting feature found in the internet’s current architecture cannot support the scale and dynamic properties required to connect sensors within an IoT network. Especially with the potential future expansion to hundreds of billions of Internet of Things devices.

So here comes Blockcloud to the rescue; a service centered network, based on the service layers of the network protocol TCP/IP.

Blockcloud will approach the above mentioned problem by combining blockchain technology and service centric networking (SCN), which is a future internet technology that will provide a service-aware network stack.

In SCN, applications will communicate directly with each other via service names instead of addresses.

You may be wondering… why not use SCN alone? Well, that’s the reason why Blockcloud’s solution is necessary.

SCN is frail when it comes to trust, security and economic incentives at the service level and it lacks a compelling and sustainable profit model.

Blockcloud´s new approach combines the advantages of SCN and blockchain to empower IoT. In this project, the blockchain operates on top of SCN to provide:

  • Fairness through consensus algorithms
  • Trust and security through decentralization
  • Economic incentive through its token economics model

The SCN forms the underlying physical network that will provide connectivity, mobility and scalability.

As pictured in the above index-diagram, we will dive deeper into the problem, the what and the how of each question, you will need to know the answers to these questions to fully understand this novel, new approach… It’s great to have you here with us again for another Coin Crunch review, so buckle up and stay tuned!


Internet of Things

The Internet has been around for over 25 years and during this time the number of devices on the Internet has grown considerably.

In fact, Gartner has estimated that there will be over 20 billion connected devices in the year 2020 generating over 200 billion dollars in annual revenue. With the growth in devices across the consumer and business user base, along with the overall advancement in capabilities of Internet-connected devices we can only assume that the annual revenue will exponentially increase.

How will the Internet with its current design constraints handle this new found growth?


If you are reading this report you likely live in a country with access to the Internet and may have to it across multiple devices, however, what if you lived in a rural area or in a lesser developed country?

Will these areas be saturated with devices that aren’t able to connect to the Internet? And what about those people who only have access to an Internet connection through their mobile phone plans? How will the connection stay stable and location of that device be maintained as it migrates from cell tower to cell tower?


In many of these services today, devices are connected to a centralized server or farm of centralized servers to maintain a stable service that can continue to scale almost limitlessly. What happens when this moves to a decentralized architecture?

How will the tech scale? Will it be able to expand almost indefinitely to allow billions of devices to connect together?

Trust and Security

And of course, what about trust and security, how are all of these devices going to be secured? With all of the data that is being collected – including people’s personal information – will it be secure?  Can we trust that the IoT device will not share our information inappropriately? How will this device securely store our personal data?


The solution that blockcloud is implementing has several components allowing them to combine flexibility, transportability,  and scalability of the Service Centric Network with the built-in security and accountability features of blockchain in order to solve the problems expressed above. But how will they achieve that??

Flexibility & Transportability:

IoT devices are always publishing and are quite mobile – the network needs to adapt to this aggressively changing ecosystem. This extreme mobility will inherently be supported by Serval. A service-based communication paradigm.

The centerpiece of Serval architecture is SAL, a new Service Access Layer that sits above an unmodified network layer. It enables IoT devices to communicate directly on service names.

The network provides the service and it does not need to manage the direct communication with the exact end-point who provides the service.

That is why end-points can seamlessly change network addresses, migrate workflows across interfaces, or establish additional flows for efficient and uninterrupted service access.


Service registration and discovery become the key features of Blockcloud.

A Distributed Hash Table (DHT) network, which we´ll study deeper in the next section will solve the scalability issue.


Security issues will be solved by the hand of Coral. It forms the secure backbone of the Block-cloud network. It is the blockchain based side of the project.

Every communication between devices will be written to the blockchain, and guaranteed by the Proof-of-service consensus.

Therefore there is no central point which is exposed to attackers and miners are economically motivated to be honest.

Accountability features:

Blockcloud will aim to create new marketplaces, the evolution and massive adoption expected in the IoT devices will make the physical world much easier to search, utilize and engage with as it is in the virtual world.

To implement the solution 5 key technologies will be needed:

  1. Layered Structure
  2. Leverage a service access layer
  3. Proof of Stake (PoS) mechanism
  4. Implementation of a Compact Diagonal Acyclic Graph (CoDAG)
  5. Implementation of a Truthful Continuous Double Auction

These solutions will be used to implement an incentive driven real-time digital marketplace. This will be discussed in detail in the Main Feature section below.

Main Feature

The Block Cloud ecosystem is built around a Layered Structure, 4 layers to be exact; 2 in the control plane and the other 2 are in the service plane, demonstrated in the diagram.

The Control Plane consist of: The Transaction-chain Layer and the Service-chain Layer.

The Transaction-chain Layer acts as a global ledger storing all the transactions that occur in the network, making it the base layer that the ecosystem is built on.

It’s underlying technology is called Compacted Directed Acyclic Graph(CoDAG) and it is used because it is secure, scalable, efficient and cost effective.

Example of a compact DAG

Another thing the team stresses is that the Transaction-chain layer be made to be blockchain agnostic and pliable in case of any technology migration that may potentially take place.

The next layer is the Service-chain Layer: which identifies new operations without affecting the blockchain, only BlockCloud nodes on the network are aware of these changes and the Blockchain nodes stay agnostic.

BlockCloud operates only on the Service-chain, this is where the rules for accepting or rejecting any process are defined and where a database on the Global state of the system and any changes that take place at any given block are stored.

The Service Plane consist of: The Routing Layer

BlockCloud setup the Routing Layer to mitigate the need for a management system by separating the task of routing requests and the actual providing of the service, allowing multiple service providers to exist – from P2P to B2B(Commercial entities).

By binding names to their respective hash and storing them in the control plane – similar to a DNS file, BlockCloud is confident that will promote confidence in the Routing Layer as the service files themselves are stored in the there and can be verified by checking the hash in the control plane.

The Top/Last layer is the Service Layer: within this layer all the service names are signed by the keys of the service providers and the devices can offer arbitrary IoT services outside of the Transaction-chain. BlockCloud is built to be a service oriented platform, where service names drive the communication within the network.

A service name represents a group of processes offering the same service, SAL, mentioned earlier in this article, sits between the network and transport layer and organizes the service names to their respective network addresses. I should also mention that SAL can be programmed through the user-space control plane.

Another aspect of the ecosystem is called Proof Of Service:

BlockCloud uses this mechanism to prove that a service was carried out on the network as it was announced. This comes in handy as BlockCloud also supports smart contracts by running the state machines in the service layer; they are two state machines: A Service Machine – That represents the global state of the service management and A Market Machine – That matches service providers and subscribers through a double auction algorithm.

The Marketplace:- BlockCloud is an incentive driven marketplace for IoT Services, allowing the listing and subscribing of services. Service providers are rewarded with tokens for contributing to the network and subsequently creating a positive environment for a self evolving platform.

The BlockCloud Marketplace is a dAPP built on top of BlockCloud – this is where services are listed, subscribed too and where public feedback on the service providers and the quality of their product is logged.

Truthful Continuous Double Auction

This is where multiple buyers and sellers can bid against each other to sell or buy services through a Truthful Continuous Double Auction(TCDA).

Which has the following properties:

  1. Defending against profit manipulation. Cheating traders can not increase the profit.
  2. Guaranteeing fairness. TCDA treats sellers and buyers equally, where sellers and buyers have the same opportunity to earn profits.
  3. Minimizing trading maintenance cost. TCDA optimizes the trading maintenance cost to scale the system to support a large number of trades simultaneously.

Distributed Hash Table

BlockCloud wants to capitalize on the distributed nature of P2P technology to make scalability possible by using service registration and discovery by adopting Distributed Hash Tables. Coral is the DHT of choice for the BlockCloud team because of its P2P distribution network, high performance and even though it is completely decentralized it has the ability to meet the huge demand placed on.

  1. This will keep distribution cost down and allow people to publish content that they couldn’t before.


Token Economics

Ticker: BLOC

HardCap: 15m

Tokens Sale: 20%

Potential Considerations

List of potential issues that the token/protocol/project will face or has possibly overlooked

  • Several team members and advisors do not have profiles on LinkedIn as LinkedIn is not commonly used in China. This is a slight concern as it is difficult to vet the team and verify their experience and connections.
  • IOT devices that BlockCloud has already connected :
    • Users 8,000,000+
    • Devices 7,000,000+
    • Data Acquisition Unit (DAU) 1,000,000+. This is a Data collection and normalization unit
    • MAU 3,000,000

Team + Advisors

Zhongxing Ming – CEO

  • Zhongxing is the first time he has been a CEO which has been 1 year and 7 mos.
  • He has previous roles as a Researcher at Princeton and a Team Lead at Intel.
  • Member of Blockchain Special Committee of China Computer Federation.
  • Zhongxing has been involved with 11 Publications, all related to IT related fields.
  • Has 5 Honor & Awards:
    • Outstanding Scholarship of Department of Computer Science and Technology Tsinghua University – Top 5%
    • Finalist of Intel – Tsinghua Entrepreneurs Competition Intel Corporation & Tsinghua University. One of the eight finalist teams out of 92 competitive entrepreneurs teams.
    • 2x National Scholarship  – The Ministry of Education of China, honorable prize for undergraduates in China (top 1%).
  • Guadated with a Ph.D, Computer Systems Networking and Telecommunications at Tsinghua University.

Shu Yang – Head of Scene Lab, Chairman

  • Shu has 7 months as Chairman at The BlockCloud company
  • Graduated with a Postdoctoral at Hong Kong Polytechnic University
  • Graduated with a Ph.D from Tsinghua School of Medicine

Kun Hu – Head Of Development Department

  • Kun has been in his role for 1 year and 5 months.
  • Previous notable roles, 4+ years Project Management and Software Architectural experience
  • Guadated with a Bachelor of Computer Science at Huazhong University of Science and Technology.
Team Awards

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