Cryptocurrency and blockchain are still relatively new technologies. So new that, in fact, we are still discovering useful applications for it in our daily lives. While cryptocurrencies are an obvious fit for the financial sector, you may be surprised to know that this technology is finding a place in the space industry.
It may seem like an unusual match at first, but if we take a close look at the direction of the industry, i.e., the movement towards public-private partnerships, the commercialization of space flight, and increased satellite communications, blockchain has many inherent features that are a perfect fit for space exploration.
It all boils down to the use of the blockchain’s way of storing information. All data on the blockchain is decentralized (shared among many participants), transparent, and highly secure (difficult to hack). These properties lend themselves to numerous space applications from fundraising to satellite communications.
In this article, we take an in-depth look at how blockchain technology and space exploration can complement each other.
Improve Blockchain Security and Satellite Communication
The Bitcoin network is known for its resilience and robustness. This is due mainly to distributed nodes that communicate with each other to achieve consensus. However, while the Bitcoin network is one of the most secure blockchains around, it is not invincible. 51% attacks and attacks on individual nodes (also known as Eclipse attacks), while expensive to execute, are theoretically possible.
These attacks can compromise the network, creating double-spending situations. Therefore, having an independent backup can help strengthen the blockchain and mitigate the effects of wide-scale network attacks.
Enter Blockstream’s satellite API for Bitcoin. This 24/7 broadcast of the Bitcoin blockchain is served from six satellites in space. By reducing dependence on the internet just a bit, backup satellites can help reverse any damage caused by a coordinated network attack. In a more extreme scenario, satellite backups can also help ensure that the network remains running 24/7 even if a widespread internet outage occurs.
Satellites orbiting the Earth can also act as an alternative way to communicate with the blockchain for individuals without internet access. According to UNESCO, only 55% of households have access to the internet. That leaves almost half of the world’s population with an internet connection. In other words, potentially 4 billion people cannot contribute to the Bitcoin network, even if they wanted to.
For blockchain to truly expand their reach and attain mass adoption, more people need to be connected to the internet, or there needs to be other ways to broadcast to the network to reach consensus. Dedicated satellites can provide alternative ways to communicate with the blockchain, allowing people without internet to access the data needed to onboard them onto Bitcoin.
A New Way to Fund Space Startups
The space industry is once again on the rise thanks to collaborations between NASA and private companies (see SpaceX). These public-private partnerships ease the financial burden on the government while giving private companies the platform they need to make space tourism a reality.
However, as you can imagine, space travel is an expensive venture. While investments in the space industry have risen in the recent past, access to finances remains one of the biggest obstacles for entrepreneurs. This is where the blockchain can help.
Blockchain and cryptocurrencies have popularized a new type of fundraising event known as an ICO (initial coin offering). ICOs combine the concepts of an initial public offering (IPO) and Crowdfunding. During this event, startup companies can raise funds for their projects by issuing (or selling) digital tokens to investors.
What makes ICOs unique is that they are open to almost anyone with access to an internet connection. This fundraising mechanism greatly reduces the barriers of entry found in traditional fundraising ventures.
For example, a startup involved in manufacturing a new propulsion system would typically need to wait on funding from venture capitalists. This process can be time-consuming and also involves a lot of red tape when securing finances.
Alternatively, the company can turn to ICOs. Since ICOs are decentralized (free from government and third-party control), fundraising is open to a wider audience and also has the potential to raise more funds at a faster pace. Some past cryptocurrency ICOs have been known to raise millions in minutes!
Investors can also benefit from appreciating token prices based on the success of the startup. If the company or product does well, the token price (like a stock) can increase, allowing investors to sell (or trade) them for a profit.
Tokenizing Space Assets
Blockchain is also known for its ability to tokenize assets. It has been used to digitize physical, real-world objects, such as land, art, music, and real estate. This digitization allows these physical items to be split into digital “shares”. Proof of ownership of these shares is securely and permanently stored on the blockchain.
Tokenization can also be applied to space assets, such as asteroids and even the Moon. This commercialization of space assets allows interested parties to participate in an upcoming lucrative industry – space mining. Since blockchain technology is free from regional barriers, anyone from anywhere in the world can participate in space mining without having to jump through complicated hoops.
While this concept may sound farfetched, cryptocurrency entities have already acquired companies focused on space mining. In 2018, a blockchain firm, ConsenSys, acquired Planetary Resources, an asteroid mining company, for this potential use case. If successful, it is possible that, in a few years, a new wave of investment opportunities can be opened up.
This is all the more exciting considering the recent discovery of planetary bodies like 16 Psyche, a giant asteroid whose precious metals are worth an estimated $10,000 quadrillion! By applying the same principles mentioned before, this precious metal giant can be valorized and traded on the market like any other precious metal.
Satellite Monitoring and Visibility
Another, less obvious, collaboration between space exploration and blockchain is tracking the movements of manmade space objects.
According to NASA, more than 23,000 manmade fragments larger than 4 inches orbit the Earth. However, these are just the pieces that are large enough to track. Estimates show that more than 500,000 particles between 0.4 and 4 inches make up the junk in our lower orbit. NASA has also estimated that the amount of debris circulating our planet exceeds 8,000 metric tons. That’s a lot!
Furthermore, there are nearly 6,000 circling the Earth right now, and with this number set to rise by 2,500% in the next decade, the chances of satellite collisions and the creation of more debris is a real threat.
ConsenSys Space, a subsidiary of ConsenSys, has launched TruSat, a blockchain-based database designed to monitor the positions of low-orbit satellites. This community-driven application allows citizens to monitor satellite locations and feed their data to a decentralized database.
These observations form an unbiased and independent record of satellite behavior, creating the first and only public satellite location database. This level of transparency helps promote responsible and sustainable practices by satellite operators.
Final Thoughts
Integrating blockchain into the space industry presents many exciting opportunities. ICOs and the tokenization of assets from spacecrafts to planetary bodies can help fund massive and ambitious future space ventures, such as the upcoming Lunar Gateway project.
Looking even further ahead, blockchain technology can also play a crucial role in building brand new economies, especially if we are successful in colonizing other planets, like Mars!
