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Wall Street rethinks blockchain projects as euphoria meets reality

reuters.com

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Re: Wall Street rethinks blockchain projects as euphoria meets reality

#91

Post by 2RTZZSro »

tudorconstantin wrote: post #15

Of course banks can do it better with the traditional technologies. They operate in a centralized, trusted and regulated environment. Their consensus algorithm is "settling disputes in courts". And still, it takes up to 5 days to receive a payment from USA in the EU and the sender pays 40$ for the wire transfer. The blockchain technologies will disrupt the banks themselves, because they are the intermediaries in this…

>And still, it takes up to 5 days to receive a payment from USA in the EU and the sender pays 40$ for the wire transfer.

Transferwise

Re: Wall Street rethinks blockchain projects as euphoria meets reality

#92

Post by sebringj »

Isn't the core still being worked on? Meaning things like the lightening network and proof of stake? There has been tremendous buzz about this tech even in its limited state so imagine when it becomes very friendly/usable/stable/focused/possibly efficient... in use case and where things like Mt. Gox don't happen anymore. I think its a work in progress and we are at the whim of the impatient and non-technical media.

Re: Wall Street rethinks blockchain projects as euphoria meets reality

#93

Post by tacogordito »

this_user wrote: post #22

What does "blockchain" even mean in this generalised context? When we are talking about crypto currencies, it is a distributed database with a consensus mechanism that is extremely costly to run. But this is not something you would need or want in most other situations, because there is always some degree of trust with your counterparties (and legal recourse if necessary). If we strip away the consensus mechanism, al…

This is my question as well. Blockchain is perfect for a digital currency, yes. But where else in the real world is it even applicable?

Re: Wall Street rethinks blockchain projects as euphoria meets reality

#94

Post by JumpCrisscross »

darawk wrote: post #73
JumpCrisscross wrote: post #50

Earlier quoted context omitted.

Imagine if a bunch of investors walked into the Homebrew Computing Club [1] in 1976 and offered to buy anything and everything its members made for $1 million. With the benefit of hindsight, blockchain is the story of a neat database technology trashing its near-term prospects by marketing itself as a currency. [1] https://en.m.wikipedia.org/wiki/Homebrew_Computer_Club

Blockchain is a shit database concept. It's use as a currency is one of its best uses. This idea that blockchains are a good database is an absurd myth. Blockchains are useful specifically for doing distributed consensus, and almost nothing else. Currencies are one of the best applications of distributed adversarial consensus. There are others, but currency is pretty near the top of the list.

I think this paper [1] made a decent case for permissioned blockchains (i.e. "where the participants are limited to a predefined set") in cases where one must store state, accommodate multiple writers who do not trust each other and does not have access to an always-online trusted third party. The number of cases where the final condition applies is small, but positive.

[1] https://eprint.iacr.org/2017/375.pdf

Re: Wall Street rethinks blockchain projects as euphoria meets reality

#95

Post by [deleted] »

darawk wrote: post #69
hudon wrote: post #45

Earlier quoted context omitted.

I think the fundamental assumption is that "Satoshi invented a useful solution to decentralized consensus". What people don't realize is that Satoshi's solution only works if two assumptions hold true: 1. Mining is decentralized: If mining is centralized than relying on proof-of-work for consensus is waste since the centralized entity controls the blockchain anyway. 2. Consensus rules don't change: If you see the thr…

It's pretty clear that neither of those things are actual problems, though. There are plenty of issues with crypto-currencies - those just aren't it.

[deleted]

Re: Wall Street rethinks blockchain projects as euphoria meets reality

#96

Post by yxhuvud »

hudon wrote: post #45
nwah1 wrote: post #7

It is interesting that even in an article like this that they still say things like "for all its potential, blockchain is still in its early days." It is sticking with the unfounded assumption that it will be a success in the future, if only it is given more time. In technological terms, it is old. Innumerable efforts have been attempted, yielding almost no fruit. At what point are the fundamental assumptions going t…

I think the fundamental assumption is that "Satoshi invented a useful solution to decentralized consensus". What people don't realize is that Satoshi's solution only works if two assumptions hold true: 1. Mining is decentralized: If mining is centralized than relying on proof-of-work for consensus is waste since the centralized entity controls the blockchain anyway. 2. Consensus rules don't change: If you see the thr…

No, the fundamental assumption is that distributed consensus in itself is useful. So far, there are some applications (databases), but for the stuff they are using the blockchain for, not so much.

Re: Wall Street rethinks blockchain projects as euphoria meets reality

#97

Post by rsynnott »

> The project, which had successfully tested with startup Digital Asset Holdings (DA), was shelved because banks and other potential users believed the same results could be achieved more cheaply using current technology, he said.

This is more or less the curse of the almighty blockchain; it's very hard to think of a plausible, actually useful, application which can't be accomplished far more cheaply and simply using conventional means.

Re: Wall Street rethinks blockchain projects as euphoria meets reality

#98

Post by pxmpxm »

SlowRobotAhead wrote: post #41
pxmpxm wrote: post #14

Earlier quoted context omitted.

The delay and cost is a function of mandatory compliance and recourse, rather than anything to do with technology.

I’m glad some people get it. Banks do zero delay and zero cost transactions between themselves already. The idea that “if only we coukd figure out where to use blockchain, everything would be FREE” is really naive. You take away a banks ability to charge for X, don’t be surprised when Y gets a new fee. As to decentralized, there seems to be a wonderful libritarian ideal around cryptocommodities but I’m reality they a…

Just about everyone that's worked in finance professionally gets it - netting, collateral calls etc all happen daily and instantaneously and have been for decades.

Having worked in computational finance the entirety of my career, I still don't totally understand how this combination of Dunning-Kruger and Libertarian leanings somehow became a thing.

The financial times while back had an interesting take: there's a structural reason why VC throws money at seemingly non-nonsensical ideas (Theranos, wireless charging etc) - many have a policy portfolio mandate to shoot for 100x returns and as such they will throw money at impossible things as part of their fiduciary duty. So, especially in the climate of free money, funding a slightly-better-widget-startup takes a backseat to things with lottery odds that may not make any sense at all.

Re: Wall Street rethinks blockchain projects as euphoria meets reality

#99

Post by UncleMeat »

arisAlexis wrote: post #38
debt wrote: post #29

Earlier quoted context omitted.

“governmemts are thinking of putting assets and laws on Blockchain” Two things: this statement is so vague it borders on meaningless. What assets? Who will put it in there? The president? Why would a government do that? Is it free to do or is there budget? Etc. Secondly, even if we could surmount the vagueness that plagues not just this idea but all blockchain ideas, the Herculean effort required to move governments…

assets like everything from real estate records to money to corporate stocks to car ownership to birth certificates. What you call vagueness I call short sightedness and failing to see the big picture. It has been done before with all major breakthroughs since the applications are not immediately obvious to everyone.

Why would they need a blockchain for birth certificates? Why not just use a database?

Re: Wall Street rethinks blockchain projects as euphoria meets reality

#100

Post by x220 »

malvosenior wrote: post #68
seanmcdirmid wrote: post #46

Earlier quoted context omitted.

> Combined they're sitting at ~$165 billion dollars in created value . Huh? Bitcoin and Ehtereum are purely speculative assets, they have not enabled any new production or efficient distribution, they have not increased economic activity. They aren't even marginally useful in electronics production like gold is. This is like saying printing dollars creates value (though the dollar is at least useful as an instrument…

> they have not enabled any new production or efficient distribution You know of another way to transfer massive amounts of money around the globe without middle men? This claim that cryptocurrency offers no value is completely ignorant of the most basic and fundamental properties of the technology.

You do need middlemen. The middleman is whatever service you must use to convert btc or eth to local currency which will actually be accepted for payments.
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