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Tech and Banking Giants Ditch Bitcoin for Their Own Blockchain

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Re: Tech and Banking Giants Ditch Bitcoin for Their Own Blockchain

#51

Post by sanswork »

jon_richards wrote: post #41
roymurdock wrote: post #32

For anyone who needs a (very simplified) primer on the blockchain and why it's relevant for banks: A blockchain is a ledger (piece of paper that records transactions) with perfect memory of every single transaction that has ever occurred within a certain network. This makes double spending within the network impossible as you can trace every single coin in the network back to its origin, verifying that your trading p…

How do the banks ensure that aren't outmined? One of the key components of a blockchain is that no one mines more than half that chain. If you have too many blockchains, then you split the miners between the chains and open the doors for a big player to come in and overwhelm the other miners on that chain. I suppose you could somehow implement private blockchains where only those with the private key can participate,…

Banks don't need mining for their chains.

>I suppose you could somehow implement private blockchains where only those with the private key can participate, but I don't know whether this has been done or not.

This is what everyone is talking about. They aren't talking about mined chains.

Re: Tech and Banking Giants Ditch Bitcoin for Their Own Blockchain

#52

Post by Zigurd »

The regulators get friendly relations with the regulated, and the regulated get to decide how much cryptocurrency they get to skim because they started another blockchain that's friendly to regulators. A crony cryptocurrency. The bet is that regulators will be more comfortable with an indirectly captive blockchain and will use it as a wedge to lever bitcoin out of banking.

Re: Tech and Banking Giants Ditch Bitcoin for Their Own Blockchain

#54

Post by kanzure »

mpeg wrote: post #42

Both Nasdaq omx [0] and Overstock t0.com [1], mentioned in the article, seem to use the Bitcoin Blockchain to peg their internal currency against, they're sidechains, not completely separate blockchains... [0]: https://coincenter.org/wp-content/uploads/2015/06/SecondLett... [1]: http://www.sec.gov/Archives/edgar/data/1130713/0001047469150...

Timestamping isn't enough to make something a sidechain: https://blockstream.com/sidechains.pdf

... unless you are using "sidechain" in a very loose, diluted sense.

Re: Tech and Banking Giants Ditch Bitcoin for Their Own Blockchain

#55

Post by DennisP »

mkj wrote: post #53

So this is more like a git/mercurial chained hash where the head hash proves the existence of all previous revisions? Makes sense. And call it "blockchain" just to keep enough buzzwords.

That plus some kind of consensus algorithm. Proof-of-work prevents Sybil attacks when you don't know who anybody is, but if you have known entities you can use more efficient mechanisms.

Re: Tech and Banking Giants Ditch Bitcoin for Their Own Blockchain

#56

Post by sanswork »

mkj wrote: post #53

So this is more like a git/mercurial chained hash where the head hash proves the existence of all previous revisions? Makes sense. And call it "blockchain" just to keep enough buzzwords.

So this is just a chain of blocks that each verify the existence of all previous blocks? I can't believe they are calling it a block chain. Clearly it's a chained hash.

Re: Tech and Banking Giants Ditch Bitcoin for Their Own Blockchain

#57

Post by mpeg »

kanzure wrote: post #54
mpeg wrote: post #42

Both Nasdaq omx [0] and Overstock t0.com [1], mentioned in the article, seem to use the Bitcoin Blockchain to peg their internal currency against, they're sidechains, not completely separate blockchains... [0]: https://coincenter.org/wp-content/uploads/2015/06/SecondLett... [1]: http://www.sec.gov/Archives/edgar/data/1130713/0001047469150...

Timestamping isn't enough to make something a sidechain: https://blockstream.com/sidechains.pdf ... unless you are using "sidechain" in a very loose, diluted sense.

I guess you mean the t0.com chain, I do agree it's not the common case where you can transfer btc in and out of the sidechain.

Would it be considered a completely separate chain, since it needs to publish the timestamped hashes on the bitcoin blockchain ? (Or any other, sure, but right now bitcoin is the one with the widest adoption)

Re: Tech and Banking Giants Ditch Bitcoin for Their Own Blockchain

#58

Post by mongol »

The Economist article on this I found good.

"The notion of shared public ledgers may not sound revolutionary or sexy. Neither did double-entry book-keeping or joint-stock companies. Yet, like them, the blockchain is an apparently mundane process that has the potential to transform how people and businesses co-operate. Bitcoin fanatics are enthralled by the libertarian ideal of a pure, digital currency beyond the reach of any central bank. The real innovation is not the digital coins themselves, but the trust machine that mints them—and which promises much more besides."

http://www.economist.com/news/leaders/21677198-technology-be...

Re: Tech and Banking Giants Ditch Bitcoin for Their Own Blockchain

#59

Post by nickpsecurity »

sanswork wrote: post #50
tibbon wrote: post #48

Earlier quoted context omitted.

How does anyone trust it then? Isn't it by default able to have them alter it then, as they win 51% of the processing power? It seems to miss all the benefit of a blockchain, or I'm missing something?

They know all the participants and they don't use PoW. The benefits of a blockchain are known entry ordering and immutability. It sounds like you are missing a lot by having a bitcoin centric view of the problem space.

Every time Ive ever heard blockchain on here it was a Bitcoin- or Xcoin-centric view involving mining. I always countered with stuff like you just said from old research into distributed, fault-tolerant DB or SCM design. I had no idea until now that there was even parallel blockchain work with no proof of work.

So there might be a greater press problem at work here not bringing out knowledge of other aspects of blockchain research to wider audience. I dont closely follow the field so I cant accurately guess more.

Re: Tech and Banking Giants Ditch Bitcoin for Their Own Blockchain

#60

Post by nickpsecurity »

Hermel wrote: post #35
roymurdock wrote: post #32

For anyone who needs a (very simplified) primer on the blockchain and why it's relevant for banks: A blockchain is a ledger (piece of paper that records transactions) with perfect memory of every single transaction that has ever occurred within a certain network. This makes double spending within the network impossible as you can trace every single coin in the network back to its origin, verifying that your trading p…

Note that in practice, this 3rd party clearing house often is owned by the banks (as joinz venture), reducing your implied incentive to obsolete them.

Not to mention them getting credit fees. They love current system: it's a cash cow. Any work on blockchains will be to benefit them.
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