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Comment by dogma1138 | Hacker News Reader

+1 Yep a closed blockchain could provide almost instant clearinghouse functionality while ensuring that the funds are both available and were delivered. Strip that on top of existing banking infrastructure like swiftnet and you get a very lucrative system for banks which reduces quite a bit of risk on pretty much every domain involved in most transactions.

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There are absolutely no efficiencies to private blockchains. Are you proposing that banks will run miners merely for the purpose of passing signed messages to one another?

Pass signed messages to one another and accumulate them into a consistent record, yes. But when all the entities are known there's no need for proof-of-waste mining.

Nor is there need for blocks. They can merely broadcast signed messages and acks for all members of the network. The only reason blocks are there is so that phbs will buy these bad databases

There is no need to run miners. They can use the "Practical Byzantine Fault Tolerance" consensus algorithm.

http://forum.hyperledger.com/t/hyperledger-vs-bitcoin/20

See my note to the other commenter. Hyperledger does not sell blockchains, they sell decades old replicated databases

There is so much blockchain hype at the moment, and this is my thought too. There only rational I can come up with is Bitcoin was the kick in the pants banks needed to realise they can go from 30 year old technology to 10 year old technology.

What Bitcoin solved was decentralized trust. I don't see any banks replacing their existing 'trust' network with code, they'll want to reverse transactions and mistakes, and will also want a veto over any distributed ledger.

Bitcoin solved decentralized trust, but at the same time, it solved distributed trust. What preexisting database product allowed multiple organizations to confidently write to a single shared database?

Distributed ledgers are perfectly capable of reversing transactions.

Literally any distributed object store, filestore, or OS (see Amoeba and Globe). Only need to add some security enhancements to some parts as others did for that and other use cases.

Smtp

That is not what they're doing. When you have a known set of entities and trust that at least 1/3 of them will be honest, you can use other consensus systems like Byzantine Paxos. There's at least one project combining that consensus algorithm with the Ethereum virtual machine.

Just passing signed messages around wouldn't be sufficient, you need a way of ensuring overall consensus.

I agree with your post, but Byzantine Paxos require at least 2/3rd to be honest not 1/3rd

Ah that's right, thanks.

That's not a blockchain, paxos has been around since the 90s and don't offer objectively true information (only subjectively true) . they haven't been used by banks prior because they're insecure and not nearly as efficient as centralized message passing protocols.

You're using an arbitrary, uncommon definition of blockchain. A blockchain is a Merkle tree of validated transactions with a consensus algorithm.

That is the definition of blockchain. It's what was invented in Bitcoin. All other definitions would suggest blockchains were invented in the 90s or 80s

thats the best consolidated broad definition of a blockchain I've heard. Do you mind if I use it?

Should we also include elliptic curve signatures?

Some kind of public key signature seems essential, doesn't necessarily have to be elliptic curves. There's already talk about using post-quantum algorithms.

But verifying the signature is part of the validation algorithm, so "validated transactions" already covers it.

It's a terrible definition. There's no mention of pow, which was the innovation of Bitcoin, and that which secures the network

This claim is repeated often in /r/Bitcoin without any facts to back it up. I work on blockchains every day, and I disagree. Blockchains provide a mechanism for parties to agree on a transaction history that no party can retroactively alter without detection. No one can execute a transaction without the agreement of the validators. Traditional databases don't have these benefits.

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