Episode 29 of the Space Industry podcast is a discussion with Zdravko Dimitrov, CEO of Sfera Technologies about innovation in the use of blockchain technologies for satellite ground station services.
Episode show notes
Sfera Technologies is a Bulgarian NewSpace company that develops technologies to integrate satellite data systems. In the podcast we discuss:
- Uses of blockchain in the space industry, particularly in the ground segment
- The existing bottlenecks in ground station services
- The changes to practices, hardware, and software that blockchain technology would require
- How operators may be encouraged to introduce blockchain into existing systems
Sfera Technologies’ HomePort system
HomePort is an integrated ground segment service designed to accelerate satellite data delivery, from downlink to market distribution. HomePort couples a virtual ground station network with a privacy-oriented storage and processing architecture, streamlining the process to receive, ingest, process and deliver satellite data.
Satellite operators can use the HomePort platform to create a virtual ground segment for their mission by renting station capacity on a real-time marketplace. HomePort then automatically routes the satellite data from the stations straight to the cloud for processing.
Please note that while we have tried to produce a transcript that matches the audio as closely as possible, there may be slight differences in the text below. If you would like anything in this transcript clarified, or have any other questions or comments, please contact us today.
Hywel: Hello everybody. I’m your host Hywel Curtis. And I’d like to welcome you to the Space Industry by satsearch, where we share stories about the companies taking us into orbit. In this podcast, we delve into the opinions and expertise of the people behind the commercial space organizations of today who could become the household names of tomorrow.
Before we get started with the episode. Remember, you can find out more information about the suppliers, products, and innovations that are mentioned in this discussion on the global marketplace for space at satsearch.com.
Hello, and welcome to the episode, I’m joined today by Zdravko Dimitrov CEO of Sfera Technologies.
Sfera is a Bulgarian NewSpace company that develops technologies to integrate satellite data systems. Today, we’re going to talk a little bit about innovation and the use of blockchain technologies for satellite ground station services and related systems. So Zdravko, thank you very much for being here with us today.
Zdravko: It is good to be here, thank you.
Hywel: Fantastic. So let’s get into this topic. I mean, blockchain technology grabs all sorts of headlines at the moment, all over the world, and we’ve seen some emerging applications of it in space. So I wondered if you could start by just giving us a brief overview of blockchain technology in the space sector, and maybe focusing particularly on how it’s relevant to, um, satellite ground station services.
Zdravko: I think what we can, we can begin with is just to give a brief overview of what blockchain is and what exactly it does when it comes to solving problems. The essence of the technology is to actually decentralize the system. In order to avoid specific points of failure, a single point of failure, you have the main benefit of using blockchain is that you can actually enable trust.
This is pretty critical because at the end of the day, when you want to procure some kind of service or product, you need to have some degree of trust for that. Blockchain technology and some specific features of the technology, such as smart contracts and oracles, can have pretty interesting uses in providing services in space industry and specifically in ground station services.
And so, if we have to look into this from the provision of a service’s perspective, one of the main benefits is that you can actually automate the provision of services and turn everything into essentially a digital protocol that replaces paperwork, which is pretty important, especially when it comes to aggregating capacity from different ground stations.
When providing a ground station service, because you have an entirely new tool that is a lot more agile to actually provide your service and provide guarantees for your service, then it would be, if you don’t just sign a basic paper-based contract.
Hywel: The technologies that you’re talking about. I mean, you’ve mentioned there that blockchain is often operationalized through smart contracts and, uh, in the, in the ground station segment, such smart contracts must be used to get over some of the critical bottlenecks that ground station services have, in order for them to be, you know, more widely used and adopted. I wonder if you could describe some of those sorts of bottlenecks or problems that, um, smart contracts can potentially solve.
Zdravko: For example, one of the things, if, let’s say you have to provide ground station capacity to, let’s say space companies by segment operator or conversely, if you’re actually space segment operator and you’re looking for, uh, different providers of ground station capacity.
At the end of the day, you will need a specific brokerage service that can basically provide the guarantees and put them in place so that you know, that these third-party stations that you’re using can be trusted, or you have to go to this on your own and still end up having specific agreement. Of course, there are specific pros and cons for each of these processes, uh, on your own it is of course not particularly efficient.
If you run through a brokerage service, of course, you basically gain a dependence to an extent on the broker. Whereas if you actually use a smart contract, you can get into a relationship directly with the provider of the ground station capacity and the smart contract ensures that the guarantees that say the payouts, what penalties of a service is not carried out are actually in shrinking code.
And this code can be supplied with real-world data to assess whether a specific payment can be carried out, whether the service has been finalized, uh, whether it is being some kind of failure along the way. And all of this means that to a large extent, you will not need legacy approaches to actually approach third party providers of the service, but your guarantees are actually in shrink in the codes and this entire process can be automated and made a lot simpler and a lot faster.
Uh, and when you actually have this on a ledger, uh, you have provable evidence that specific transaction occurred, uh, that specific interactions actually took place, which is a major advancement over how things would be done through some kind of intermediary service.
Hywel: Brilliant. So efficiency in terms of compliance efficiency, in terms of compliant with auditing requirements. That’s really interesting. So what in particular then is, um, Sfera’s vision for addressing some of the challenges that you’ve described?
Zdravko: The one major thing that we have in terms of vision is for very, let’s say broad centralization of ground segments, because this is a trend in general, in the entire space industry.
And it’s also a bit paradoxical because we have an industry that’s actually going quite fast. You have an increasing number of interactions between actors from different jurisdictions, from different regions, different regulatory frameworks. They need to obtain trust between each other. I think at the end of the day, when you have so many different environments from each, each of these actors come, this is going to create a problem for the scalability of infrastructures, because at the end of the day, you will need a lot of brokers who do services, where you’re going to need somebody who’s operating a single network across jurisdictions, or you can actually trust a decentralized system in which the guarantees are basically provided by the code is being redefined to use.
And this will allow for a much more organic growth of ground segment capacity. So let’s say if you have somebody setting up a ground station in Australia as an individual company, or with somebody in India or Brazil or anywhere else, uh, by going through a decentralized blockchain based infrastructure, they have a uniform environment in which guarantees can be provided.
And this is going to allow for much more, like already mentioned organic growth of capacity across the globe. That can be accessed in a way that is, that is reliable. And our vision is to basically work in that direction, provide an infrastructure and toolkits to make this possible. Make it possible to, to decentralize the provision of ground segment services, which of course does not mean that other types of ground segment services are somehow rendered obsolete.
It just creates another vector in which the ground station service can be procured, even for those who already are and can be procured to off-road, even for those who already operate specific types of services.
Hywel: We hear a lot about the regulatory burden on ground station managers in terms of the licenses required. And then to add onto that the commercial arrangements that they need to make with their suppliers and their upstream clients. Yeah. And when you’re talking about crossing borders, like you say, different jurisdictions, this is a difficult problem. And one that the aptly named smart contracts would seem to be particularly suited to.
However, such a change in the operations for ground station managers and ground station network providers; how it would be adopted? How would it ever come about, especially at scale? Is that going to require changes, significant changes, in hardware and software that’s currently used?
Zdravko: Not particularly in terms of hardware, unless let’s say station operators or some kind of intermediary links, let’s say process the data after you receive any to operate some kind of validation hardware.
Very particular type of notes that ties up with a specific blockchain. Uh, the reason no particular need to actually go for other types of hardware or have some, some special kind of software, of course there is going to be in each manage identities to actually tie up the specific identity of the provider or the consumer of the service to, to the blockchain in some way.
Um, manage key pairs and everything else that basically allows you to an extent to ensure that the other party is who they say they are. And so that’s one of the things and of course, um, in terms of, uh, validating the events that have occurred for the smart contract, it would be necessary to operate with Oracles because the smart contract itself, this is something that’s isolated on the blockchain.
So it doesn’t really operate with external data or things that don’t happen on the blockchain. So if you actually want you to interpret anything, That occurred between two stakeholders and a transaction. You will need to have an external input. It’s introduced to the smart contract that sort of oracles come in, which are basically software protocols that translate real world events to the smart contract so that a decision can be made in automated.
That’s an example I can give you. Let’s say there was a contact window for ground station, it’s supposed to receive data from a given satellite, but for some reason, the data that is being anticipated to have been received has not occurred, is not being received and the event has not occurred. So if you need to figure out what has happened and actually automate this process, as opposed to making calls investigated and so on, you can actually use, or it goes to identify what it was up.
I’d say a force majeure event, what some kind of elements of the system did not function, according to specification, was this can be configured in any possible way to ensure that security and privacy concern, but this entire system can actually be automated. And it’s possible that some software configurations may be needed for things like this, but overall, all of this can pretty much run on available hardware and no specific, uh, very specific knowledge would be necessary to actually make this upgrade.
Hywel: And then I guess in terms of, um, the, the introduction of, of such services as well, the, the adoption, what steps do you foresee would be required to help convince operators to switch from some of the legacy solutions that you’ve discussed to an arrangement that’s based on smart contracts and are there incentives that could apply at certain times that would nudge them to accelerate adoption?
Zdravko: That’s actually a very good question that touches upon several technological aspects of blockchain. So of course, when you operate with public blockchain, let’s say if you want to do something, you inevitably have the volatility. Essentially of the payment methods, because you know, when you have, when you have to pay with, uh, with basically a tokenized asset, um, that asset doesn’t have a fixed price.
So it’s pretty volatile. And that means that if you have to carry out payments over all the blockchain, then you have to rely on, let’s say a, uh, an additional implementation. So hold a stable point, uh, which is something that’s going to make it possible to avoid this fluctuation in price. Basically solved the volatility problem.
So one of the very specific things about this technology is that it allows for a very direct peer-to-peer communication and exchange of value. So a great incentive for somebody who operates, let’s say a ground station here would be that they would directly monetize their capability. Uh, and this would actually happen quite fast.
Some because whenever you transfer value over a blockchain, that’s a, that’s a process that occurs within minutes and it’s completely traceable and verifiable. And the system itself is made in a way that you wouldn’t need to rely on a third party to actually verify that this process is correct. So in essence, there is a lot more control in the consumer of the service and the provider.
They have a lot more freedom to manage their service however they want to directly generate revenue from that they provide a ground station service to directly generate revenue from it. Or if the ones who consume such services to actually maximize the value that they’re investing into the service. So this is, this is actually a pretty good, pretty good incentive.
Uh, but of course there are plenty of hurdles that still remain because blockchain itself is not a very recognized technology yet. It’s still making its, let’s say initial steps in real world use cases. Because up until now, it used to solve mostly, you know, virtual use cases and you know, it’s not particularly tangible.
Hywel: Finally, I guess, you know, we’ve talked about some of the specific applications and areas for the future. I wondered if you could just touch a little bit more, maybe a bit more broadly on, uh, how you see smart contracts and blockchain technologies being used in the space industry, reaching a sort of level of penetration in the next up to five years?
Zdravko: We’re actually quite optimistic on this. Uh, there is a growing need to replace specific legacy solutions with something that’s more efficient, especially as the industry grows, because like we already mentioned, there is a paradox between the growth of the industry and the needs for increasing trust mechanisms.
So the smart contracts and in general, in blockchain technology in general is a pretty good solution to this. So some specific use cases would be like, we were already building, like in terms of ground station services provision. Another interesting use case would be access to data. So for example, if you have specific Earth Observation data that is being processed and ready to be used. It’s possible to use blockchain to track who actually has access to specific datasets and see who has used specific data or who has access to specific dataset. There are plenty of other non-data-related use cases which can come up, which is supply chain management.
So let’s say you have to track the components for a launch or something else. I’m blockchain is a pretty good layer to provide verifiable tracking of the entire supply chain access to specific resources to something else. That would be great use case, for example, a computation resources or access to a satellite service or some kind of, let’s say operational time on a satellite, but it’s also something that’s very useful. Credentials management, identity management, or specifically sensitive environments, where there are needs to be up at say a role-based access architecture, and you need to see who’s actually using what resources.
This is a great use case of blockchain. In general, there is a great amount of processes that can actually be at the very least deployed on a blockchain or in a more optimal way tokenized. So they can be part of multiple systems that talk to each other. So we’re pretty optimistic in the usage of blockchain for, for this purpose.
Um, of course there is also other use cases like space traffic management, but overall there are many many potential ways in which this technology can actually be deployed successfully.
Hywel: Fantastic. Well, thank you very much, Zdravko. I think that’s a really good place to wrap up. It’s been really great to hear all the different insights and, uh, application areas, et cetera, where blockchain could have an impact.
And I think our listeners will have found the discussion really useful, particularly with where we are in the wider context of the web3 movement. And, um, a lot of the stuff you hear from outside the industry. So it was great to get the space industry and a viewpoint and all of this. And that was a really useful too.
Zdravko: Great. Thank you.
And to all of our listeners out there to their, the whole Space Industry community, and you can find out more about Sfera technologies in the show notes and on satsearch.com. Our platform has, you know, a variety of information, content and features built to help you conduct trade studies and make procurement requests for systems like this.
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