How blockchain will revolutionise far more than money | Hacker News Reader

How blockchain will revolutionise far more than money

aeon.co

55 pointsjonbaer29 comments

Why is there this hype around “blockchains”? What does this even mean?

Bitcoin has a proof-of-work chain which, through wasting superlative amounts of energy and destroying the atmosphere, establishes consensus about transactions as a distributed system. It is clear what a “blockchain” is there, and in Bitcoin clones and forks.

But outside Bitcoin, what does it refer to? Peer-to-peer? Distributed systems? Global warming? It feels like a meaningless buzzword. How, exactly, does having a Bitcoin-esque distributed consensus system – if that's even what you mean – actually solve some given X? It never seems to be explained, it's just “blockchain will solve X”.

I think “blockchain” might be the new “.com”.

Blockchains have their limitations, but generally speaking they're a useful tool for 'decentralised trust'. Enabling network nodes to trust each other without relying on a central authority is useful in a number of fields, that's why there's a buzz around them.

So an "intranet" to bitcoin's "internet"

Bitcoin isn't really analogous to an "internet", but I think I get what you're trying to say, in that blockchains offer a form of private network on top of the shared public network. There is some truth in that, though it goes beyond public and private, it's truly about trust. All transactions on the Bitcoin blockchain (in its current form) can be seen by everyone else in the network. The trust comes from sharing knowledge about transactions, every Bitcoin (and Satoshi, which are fractions of a single Bitcoin) is traceable by every node on the network. In some ways it's even more 'public' than the Internet it is running on.

> through wasting superlative amounts of energy and destroying the atmosphere

It's true, Bitcoin does spend a lot of energy to provide proof-of-work, the underpinning of distributed trust in the blockchain.

But you might find proof-of-stake[1] interesting. It requires far less energy--no repetitive hashing. It could also provide stronger protection against sybil attacks, requiring the attacker to spend far more in real terms in order to obtain a 51% stake.

The Ethereum blockchain is planning a move to proof-of-stake[2].

[1] https://en.wikipedia.org/wiki/Proof-of-stake

[2] http://ethereum.stackexchange.com/questions/9/why-does-ether...

EDIT: Formatting

Proof of stake has been around for decades in some form or another (Quorum based consensus was what it was originally called) Andrew Poelstra has compiled a pretty decent list of reasons why it's an uninteresting idea: https://download.wpsoftware.net/bitcoin/pos.pdf (He's created other documents on the subject)

This 2 minute video explains the value of blockchains at a high level quite well: https://www.youtube.com/watch?v=r43LhSUUGTQ

solutionism

> destroying the atmosphere

Is bitcoin responsible for more CO2 than airplane travel or concrete production? Lets use our very best judgement and look at some data before making an emotional statement with no basis in reality. Concrete production is responsible for 5% of global CO2 emissions. How much electricity do you think bitcoin uses?

We need those 2 things, bitcoin isn't needed.

Is money needed? Is the Euro needed? All currencies serve a purpose to some. Just because YOU don't need bitcoin, doesn't mean that isn't needed by others.

I don't need Euros, that is true. The Euro is a crucial part of the global economy and hundreds of millions actually do need it day to day.

That is not the case with bitcoin.

This is a pretty good explanation of it for the banking system at least:

https://gendal.me/2015/04/27/how-to-explain-the-value-of-rep...

Beyond accounting ledgers though, hard to say.

About the amount of energy wasted, it is true, the energy used for securing the network is a waste, yet this waste is competing(or at least wants to be competing) with the alternative of physical security, of surveillance cameras, vaults and secure transport vans - or, alternatively, with banking electronic security systems. Compared to those, is the waste bigger or smaller for what it can offer? If you look it like that, at least for me, it makes sense and it seems quite efficient.

As to this point, what do you feel for example, abotu hight frequency trading? Is that not a waste also? I think it's an even greater waste, but it seems, as long as something is making money, nobody bats an eye.

All these articles completely disregard the cost of the system - and this is not a trivial problem. The bitcoin blockchain is subsidized by the speculators.

Eventually I think that the solution will kind of relax the 'permisionless' aspect of the system and have some cheap but slightly more centralized timestamping. Just like the PrivaTegrity proposal by https://en.wikipedia.org/wiki/David_Chaum (I can't find the source for this - but Google finds many articles about it: https://www.google.pl/search?q=privategrity).

The timestamper does not need to know what it is timestamping and additionally timestamping might be distributed across many jurisdictions - so the damage of a rogue timestamper can be limited. And it is only timestamping that requires that wasteful proof-of-work.

You are correct - permissionless blockchains have a completely different threat model that results in a high cost to secure the blockchain from attack. The vast majority of new blockchain systems we're seeing developed are private, permissioned systems. This offers a different security model that is still useful for a variety of situations, such as in existing financial network where there is already a fair amount of trust between the actors.

It is kind of confusing to use the terminology from bitcoin on solutions unrelated to the element that was the technological breakthrough in bitcoin.

It's fraudulent, even. Many of these "blockchain" companies are just writing weird crud apps, and marketing it as something else.

>The bitcoin blockchain is subsidized by the speculators.

And parents paying for the electricity necessary for mining coins ;-)

Actually, the evidence is starting to show that the subsidy comes from federal government. Mining is the process of converting registered value to fungible value. The premium on fungible value comes by way of regulatory controls on drugs, gambling, capital flight, and sex workers. A little more than 50% of the bitcoin being mined on any day would appear to be allocated for use by those who need bitcoin, in these industries.

>But you will soon be able to vote from your mobile phone in a way that is 10 times more secure than the current US or UK systems, at a fraction of the cost and fraud-free.

Malware on the phone: No need to attack the block chain if there's a weaker part of the system.

Also only those who really understand the technology and math behind the block chain as well as the voting software's source code are able to verify the votes. All others have to trust the technology/math/software.

Not so with voting on paper: It doesn't require special knowledge to check that votes have been counted correctly. In Germany everybody has the right to observe the voting process, including the votes being counted.

What a load of crock. I work in fintech. And every week or so, someone will mention 'blockchain' completely out of context, presumably because they think it makes them sound intelligent.

Blockchain won't solve anything. Sure, it's interesting as a distributed ledger, but that's as far as it goes. You think financial institutions care about innovation? Think again. They'll gladly talk about the latest buzzword if they think it can make them any money, but no one is working on anything credible using blockchain in fintech.

Banks are scared of decentralized services, and they will gladly pander FUD at governments who are willing to listen.

Financial institutions won't be making the decision as to whether the technology is widely adopted or not in the long term. If there is another financial crisis, then people will eventually work out the existing financial system (esp the role of central banks) is fundamentally f#cked. Alternative currencies may then boom in popularity. It's a high risk area for startup investing, but someone, somewhere is going to make a ton of Bitcoins (?) out of this.

> All the information in the record is permanent – it cannot be changed – and each of the computers keeps a copy of the record to ensure this. If you wanted to hack the system, you would have to hack every computer on the network – and this has so far proved impossible, despite many trying, including the US National Security Agency’s finest. The collective power of all these computers is greater than the world’s top 500 supercomputers combined.

Isn't this totally incorrect?

Not buying the hype.

Slow? I was under impression that adding records to blockchain is fairly slow...

Was it improved in recent projects to make blockchain more multi-purpose solution?

There are quite a variety of blockchain technologies that are now available - some of them have greatly improved throughput, though there's always a tradeoff. None of the extremely high throughput systems are permissionless - they usually rely upon having a pre-approved "federation" of consensus checkers.

Yes, ethereum: https://www.ethereum.org/

confirmation times are much, much quicker than bitcoin. Plus you can make the blockchain "programmable" because it adds a turing-complete programming language. It's getting a lot of momentum right now and could (in my opinion) take over the market cap of bitcoin.

No one needs turing complete smart contracts. The overhead of this unnecessary feature will likely sink this project.

When? We've been hearing this for at least 4 years now. Where's the revolution? Did I miss it?

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