Although blockchain is currently celebrated for being the foundation for DeFi and cryptocurrency systems like Bitcoin and Ethereum, the next big leap for this technology, experts say, may be in outer space.
Possible ways that blockchain can be used in space include tokenizing spacecrafts and their payloads, crowdfunding space missions, tracking supply chains for space machinery parts and mined resources, and even the creation of a self-policing space governance system, where corporations can use smart contracts to create and enforce rules for each other.
“By using blockchain technology, companies could create utility tokens and commercialize the data gathered during space exploration missions,” a spokesperson for the European Space Agency (ESA) told Forkast.News. “For example, companies could tokenize the space in the spacecraft, that they can [then] rent out to people who want to [send] things to space.”
Forkast.News interviewed a number of experts working on blockchain projects to find out how blockchain is being applied in the space industry today, and explore the emerging technology’s extraterrestrial potential for the future.
Blockchain nodes in space
While some of the ways that blockchain could be used in space are still untested theories, the technology has already been transported out of this earthly world to augment security in cryptocurrency transactions.
In August, crypto company SpaceChain announced the completion of the first “multi-signature” blockchain transaction in space, sending around 0.0099 BTC (about US$92 at the time) to bitcoin addresses via blockchain hardware that was installed on the International Space Station in 2019.
The transaction brought SpaceChain a step closer to their goal of having a decentralized network of blockchain nodes operating from satellites in orbit serving fintech and business applications.
“Executing the multisignature transaction in space encapsulates our continuous efforts in building out an open-source blockchain-based satellite network that is secure and immutable,” said Jeff Garzik, SpaceChain co-founder and CTO in a news release. “As we continue to identify more use cases for blockchain-based satellite networks in space, we hope to bring blockchain to mass adoption.”
According to SpaceChain’s white paper, the goal of having blockchain nodes in space is to make it more difficult for third parties like hackers to disrupt communications through blockchain systems, in contrast to less secure land-based networks.
“Imagine a physically untouchable data center in space with a higher level of security because the data center cannot be accessed on Earth,” reads the white paper.
SpaceChain’s integration of mobile devices’ GPS systems could also add another layer of security, as it would include location data that could prevent data falsification via secure timestamps.
“Any low-power mobile phone can receive GPS signals and process data,” said Garzik, in an interview with Forkast.News. “The goal is for billions of low-power devices globally to receive data directly from satellites orbiting the Earth — there is no need for a satellite dish or any sort of middleman between the user and the satellite itself.”
But not all experts agreed that a direct downlink to mobile phones and small devices from satellites in orbit would enhance security.
“Whether you’re running a full node while in space via a satellite or while on Earth, the security of the blockchain you’re validating/mining remains unchanged,” said Chjango Unchained, the online pseudonym used by the vice president of ecosystem development at Tendermint, a decentralized applications developer headquartered in Berkeley, Calif. “SpaceChain runs a smart contract on the Qtum blockchain, whose token can be exchanged 1:1 with its SpaceChain ERC20 token equivalent on Ethereum — knowing this, its multisignature wallet on a satellite doesn’t technically provide any additional security to either chain.”
See related article: How smart contracts can help govern and mine resources in outer space
In 2019, the ESA granted SpaceChain about US$66,000 to commercially develop its multi-signature satellite wallet as part of an assessment of the technology’s business potential and technical feasibility.
“Having a multi-signature wallet or a blockchain node in space is a new concept, and although this may appear at a first glance a more secure solution with regards to a terrestrial one, this still requires a thorough end-to-end cyber-security assessment in order to put in place the needed security countermeasures to enable and maintain over time a proper level of security,” said the ESA spokesperson, who is not authorized to be identified as she works for a private contractor that handles communications for the Netherlands-based space agency.
As recently reported in Forkast.News, flooding in places where large portions of Bitcoin and other cryptocurrency miners are clustered in China has destroyed mining equipment, resulting in noticeable drops in cryptocurrency hash rates. The flooding illustrates the vulnerability of centralized, land-based infrastructure, and how space-based alternatives could provide a layer of extra security — barring the risks and natural disasters associated with being in space.
“Some of the terrestrial data centers take security very seriously, by carefully controlling access and employing armed guards. With satellites, the access can be more carefully controlled because they’re out in space,” Garzik said.
Crowdfunding space missions and tourism
The continued success of commercial spaceflight companies such as Elon Musk’s SpaceX has bolstered space endeavors, which were formerly limited to government-funded agencies like NASA and the ESA.
NASA is currently planning to launch its first full-length astronaut mission with SpaceX, sending 4 astronauts to the International Space Station (ISS) in October. In August, SpaceX successfully completed a test flight carrying two astronauts to the ISS.
The test flight was the first time the company had sent astronauts to space, but the expense of such a trip can reach from US$62 million to $90 million depending on the type of rocket used, which could put a damper on the future of commercialized space flight.
Blockchain could help lower the currently astronomical costs of commercial space flights through the use of tokenization.
Traditionally, the private-sector space industry is funded through debt funding, equity funding or donations by space enthusiasts. However, these traditional funding methods are not as accessible to smaller companies and startups.
“Alternatively, [space-related] startups can choose to use blockchain-based crowdfunding by using blockchain technology to create utility or security tokens, which it can then issue in a security token offering (STO) or an initial coin offering (ICO) to investors interested in the project,” the ESA spokesperson said.
Psst! Amazon CEO @JeffBezos has been selling his stake in the e-commerce giant to fund his space exploration film, Blue Origin.https://t.co/cf240yQpBn
— SpaceChain Foundation (@SpaceChain) September 22, 2020
People who buy utility tokens could use it to access investor services from the aspiring space startup or trade the tokens on a cryptocurrency exchange. Those purchasing security tokens can also end up acquiring a stake within the startup and be entitled to dividends or interests that arise from the profits made by the startup through the project.
“By using an STO or ICO, the startup can easily raise billion[s] from small investments made investors who may range from individuals to large companies (e.g. for the case of the propulsion for microsatellites, a satellite integrator company could be an interested party that could decide to invest with the startup),” the ESA spokesperson said. “This way, blockchain helps reduce the barriers to raising funding for space projects through the democratization of access to finance.”
In the same way blockchain could be used to help lower the price of space missions, it could also reduce the cost of space tourism.
Space tourism venture Virgin Galactic’s ticket cost for a flight on its future space vehicle is currently set at US$250,000, and Amazon billionaire Jeff Bezos’ Blue Origin company is selling space tourism tickets for about US$200,000.
“Since one seat can only be used by a single person, the tokenization of the seats can be fractionalized and by using smart contracts,” the ESA spokesperson said. “If a person invests a given amount of money on purchasing the tokens, [they could] qualify for a seat.”
However, such use cases for blockchain are still in the idea or niche stage. Widespread demand for the technology’s application in space could take decades to develop.
“I would, however, love to see a future where people can donate Bitcoin or other cryptocurrency to fund NASA or SpaceX to give them more sources of revenue to draw from,” Unchained said.
This is the Part 1 of a two-part series of articles on blockchain in space. The next article will cover using blockchain for space governance, the tracking of satellites and other applications for the future.
