ISO Close to Releasing First Blockchain Standards

The International Organization for Standardization (ISO) is expecting to come out with its first standards for blockchain technology in the next 18 months.

ISO/TC 307, a committee within the body that was set up to work on standards around blockchain and distributed ledger technology (DLT), is likely to release its first standard on terminology, and will also be coming out with a technical report on smart contracts on a shorter timeframe—possibly within a year, says Craig Dunn, chair of ISO/TC 307.

“Having a common language and a common understanding of terms and the use of terms in a particular area is important, including for developing further standards in that area. So terminology is likely to be the first area of publication standards in this space, perhaps followed by [standards for] reference architecture,” he says. 

Dunn isn’t able to reveal the specific terms within blockchain that are currently under the scrutiny of the committee. However, given the plethora of diverse projects being developed on blockchains by companies of all kinds, there are plenty of terms that are problematic. 

Charles Kerrigan, a partner in the Banking and International Finance Team at CMS London, says the ISO standards will establish consistent terminology, which has practical consequences for firms trying to develop projects, and also will be useful in the future development of more standards in blockchain.

Ambiguity exists in blockchain parlance, Kerrigan says: for example, the term “smart contract” can mean one thing to a programmer and another to a lawyer. “‘Smart contracts’ is arguably an older terminology in computer science and programming,” Kerrigan says. “So they [programmers] have kept ‘smart contracts’ as having the meaning that they give to it, and in the legal community we use the phrase ‘smart legal contracts’ to distinguish it from what the commuter programmers are talking about.” 

I think ‘consensus’ is the key word here… part of [the ISO’s] job is to identify and develop consensus on different aspects

Advait Deshpande, RAND

Salil Gunashekar is the research leader at RAND Europe, which was commissioned by the British Standards Institution (BSI) a couple of years back to look at standards for blockchain. The research was intended to be used as input in discussions with the ISO technical committee.

Gunashekar says the most common terms they came across were simply distinguishing between DLT, blockchain and bitcoin – terms that tend to get conflated.

“I think now the working group that ISO has put together is probably drilling one layer down into that, looking at more specific terminology and perhaps trying to come up with a vocabulary that would standardize conversations across stakeholders in the blockchain ecosystem,” Gunashekar says.

“This is a standard thing that happens with quite a few new and emerging technologies: they enter the market for the first time, get hyped up for a variety of reasons, then the media also starts writing about technology X having the potential to save the world—sometimes the level of detail and what these technical phrases actually mean, that gets lost in these conversations.” 

ISO’s Dunn says people will understand the same terms differently depending on how they are approaching the build of the technology.

“For a technology that has been developed at different speeds and with different approaches right across the globe, it is understandable how you can have very different opinions on a term and how you might define a term,” he says. “It is an area where it is not unusual to have a degree of debate about how a particular term might be defined. And with blockchain and distributed ledgers, because it is a maturing technology, as the technology develops and changes, so will the way you define some terms.” 

Given that blockchain is an evolving technology, one future challenge for ISO/TC 307 will be keeping the standards updated once they are published.  

“I suspect that in two or three years’ time, there will be terms that have evolved in the community of blockchain and distributed ledger that may not even exist today,” Dunn says. “Or maybe they are only just being started to talk about or become relevant, but they are not developed enough to warrant inclusion in a standard. For the standards to remain relevant and impactful, they have to be kept up-to-date, and the ISO does have policy requirements to make sure those standards are continued to be updated.”

ISO/TC 307 is looking at different areas for standards in blockchain, including system interoperability, reference architecture, smart contracts and taxonomy. While in some areas they expect to see standards, Dunn notes this will not always be the case, and they will sometimes instead issue technical reports.

A number of countries are contributing to the development of standards in ISO/TC 307 with input on the technical specifications and reports, so a lot of work needs to be done to achieve consensus, Dunn says. The more countries that agree to a particular approach, the more likely they are to follow the standards, the more powerful or influential the standards are likely to be.

“I think ‘consensus’ is the key word here,” Advait Deshpande, senior analyst at RAND, says. “That is why ISO is the international standards organization: part of its job is to identify and develop consensus on different aspects, including making sure that commercial interests are allowed to flourish, at the same time you have a competitive market.”