On October 9th, Mastercard was granted a patent for a ground-breaking method that would partition a blockchain, therefore, allowing the storage of multiple transaction formats and types.

Blockchain stores transactions that are made over it, into different blocks. For example, BTC uses one type of blockchain system to record data, whilst ETH uses another. Mastercard wants to use the blockchain to store different types of data as well as having the ability to use different types of cryptocurrency. In other words, it will have to run multiple blockchains because of the fact that the transaction records are “often required to be of the same format and include the same types and even sizes of data”. As such, this would require an astronomical cost in terms of hardware, resources, and computing power.

Permissioned and non-permissioned

This problem is caused in part by the varying degrees of open or permissioned access on blockchains. Some blockchains are non-permissioned and allow anyone to be a part of it, whereas others can be permissioned. These require special and specific permission to read, access, and write an information on them and they are more prevalent with corporations industry level where security, role definition, and identity are of the utmost importance.

The new patent filed by Mastercard states that the inflexibility of blockchains when it comes to data formatting means that the usage of permissions on permissioned blockchains is restricted.

“[…] an entity may want to operate a permissioned blockchain, where varying levels of permissions may be used for participation in the blockchain, such as by limiting the nodes that may add new blocks to the blockchain. However, because all transactions in a traditional blockchain are formatted similarly, the permissions may not be extended to access to the actual transactions in the blockchain … The patent authors say their partitioned blockchain could bypass such limitations and provide ‘enhanced usage of permissions”.

Plurality of subnets

The new network proposes a way to expand the usability of blockchain by allowing blocks to receive data through a “plurality” of subnets”.

A subnet is a proposed partition that will be internally consistent but that would also interact in a wider, single system. To quote the patent application:

“A subnet may have rules about data in a transaction record, the organization of the data, the size of each data value, and the hashing algorithms used in the formulation of the subnet’s Merkle root.”

This means that subnets would have the ability to receive information from various different computing devices as well as allowing the addition of data of any size or type, without following a standardised data format. The number of subnets would be limited with the Mastercard system supporting a maximum of three.

Mastercard first applied for the patent back in July 2016 and it took over two years for a decision to be made. This is just one of over 80 blockchain-based applications that Mastercard has made over the last few years, a number that is expected to grow in due course.


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