EU Commission selects IOTA for blockchain infrastructure project

IOTA Selected for Phase 2 of the EU Blockchain Pre-Commercial Procurement

IOTA has been selected by the European Commission alongside just three other companies for Phase 2A of the European Blockchain Services Infrastructure (EBSI). This European Commission-backed initiative is intended to develop and operate a comprehensive international distributed network that will enable the flow of verified information between institutions, enterprises, and individuals throughout the EEA. This phase will last six months and emphasize research, prototype development and lab testing. The Foundation is set to receive European Commission support to develop and test innovations that can contribute to future evolutions of the European Blockchain Services Infrastructure.

The IOTA Foundation is pleased to announce that it has been chosen to compete with four other projects in the second of three rounds of the EU blockchain pre-commercial procurement process. This follows Phase 1, where the IOTA Foundation and six other projects were chosen from over 35 applicants.

Phase 2A, which lasts six months, concentrates on research, prototype development and lab testing, with the participating projects – including the IOTA Foundation – receiving support from the European Commission to research and develop blockchain innovations in the context of testing how future evolutions of EBSI could evolve towards a more scalable, energy-efficient, secure and interoperable architecture. The IOTA Foundation will be working closely with Software AG on implementation. Following these six months, an evaluation will be made by the European Commission on the technical results and progress of the participating projects; based on this evaluation, a minimum of three projects will be selected to move on to Phase 2B, final solutions development and field testing, which is expected to last another year.

In the coming months, we will be testing IOTA innovations that could benefit the EBSI infrastructure with use cases related to digital product passports for digital waste recycling and the cross-border management of IP rights for creative work. Such use case application developments will be done in partnership with specialized partners. In addition, the IOTA Foundation will be actively working with and expanding its partner network to develop further solutions for EBSI.

What will the IOTA Foundation be working on in Phase 2A of EBSI?

The main focus of our work in Phase 2A will be on the integration of the IOTA protocol on the (test) infrastructure, with iterative testing and improvement to achieve performance objectives.

At the same time, we will be working on research for adapting and improving the protocol to be used in the many possible EBSI use cases, ranging from identity and Internet of Things to tokenization and decentralized governance. In this article, we’ve highlighted five main areas for research, development and testing for EBSI. These are:

Scalability. To be a blockchain infrastructure for Europe, it is vital that scalability is at the heart of EBSI. To complement its DAG-based structure and committee-based smart contract protocol, the IOTA Foundation will be working on how sharding can be applied to EBSI as a way to exponentially scale the IOTA protocol in order to accommodate the high volume use cases envisaged to run on the EBSI network.

Our vision for sharding is to develop a Tangle Tree, where a “root” network connects to potentially a large number of “leaf” networks through a series of “branch” networks. Different branches and their children can be divided up geographically, by use case or by agency.

Consensus. A robust consensus mechanism –  how a blockchain authenticates and validates transactions without relying on a central authority – is an integral part of decentralization. We will build a mana-based approval weight mechanism that will be highly flexible and allow both permissionless and permissioned use cases. (“Mana” is IOTA’s Delegated Proof of Token Ownership: the more mana you have, the more weight is carried by your vote.)

The IOTA approval weight consensus mechanism is dynamic and configurable, meaning we can customize the control of EBSI for different types of governance.

Governance: As a cross-border platform, EBSI needs to be trusted by public institutions, businesses and citizens across the member countries of the European Blockchain Partnership (EBP) with their data for providing different services. Hence, the IOTA solution will need to be able to adapt to EBSI governance structures and to any requirements from the European Union, EBP member countries and different European Institutions and Regulators.

Identity: To ensure the highest possible levels of privacy and security on a Europe-wide blockchain infrastructure, we aim to integrate our GDPR-compliant Identity solution with the new framework for EU digital identity proposed by the European Commission. This will allow businesses and citizens to have more control over their data while providing verified credentials for different public and private services running on the EBSI network.

Interoperability: Along with scalability, openness, and decentralization, excellent interoperability is one of the aims of EBSI. We will prepare on and off-chain bridges to other protocols in and outside EBSI, including support for Ethereum Virtual Machine. Furthermore, IOTA’s solution includes support for industry-standard hardware boards and SDKs, as well as interoperability with DLT and enterprise systems.

The research areas listed above will be accompanied by a variety of further developments, ranging from third-party integrations to advancing the topic of post-quantum encryption.


Research and development results will be lab-tested over the course of Phase 2A to show how the functionality can work on the EBSI infrastructure. Based on the outcome of the lab testing, at the end of Phase 2A a minimum of three projects will be chosen for Phase 2B, the final stage of the pre-procurement period, where the capabilities of the newly developed infrastructure and applications will be field-tested.

The IOTA Foundation is excited to work with the European Commission on the EU blockchain pre-commercial procurement over the next six months, as well as with our subcontracted partner Software AG and other industry partners on use cases.

We very much support the strategic focus placed by the European Commission on blockchain and distributed ledger technology as a driver for innovation and growth. We are privileged to be part of this pre-commercial procurement procedure to develop a Europe-wide infrastructure based on blockchain and DLT for use in public services, and excited to be moving ahead in Phase 2.

Publication date: 
01/13/2022 - 16:45

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