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Comment by Asdfbla | Hacker News Reader

Always surprises me a bit because it seems to me like those large corporate players don't necessarily need all the features offered by Ethereum (or Bitcoin), especially proof-of-work, since there's enough non-adversarial cooperation between them that a simple distributed ledger with traditional (efficient) consensus mechanisms would suffice for most of their applications. They wouldn't have to deal with the drawbacks of Ethereum's very strict threat model.

I'm curious what applications they have in mind, or if they maybe just participate to get in on the hype and explore their options.

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Why the assumption they have "applications" in mind?

Big-corps sit on piles of cash. They have an "innovation department". They have VC arm. They throw money in accelerators, they organise fintech hackathons, They invest in small startups. They do many a strange thing with their money!

EDIT:

>just participate to get in on the hype

This.

Those companies are using Ethereum without PoW in their private networks. They plug in a different consensus model.

Are they? I know it's possible but I can't think of a single use where traditional software and/or contracts are more convenient.

What does Ethereum with no PoW bring to the table?

Centralization which is what they want

The only thing I can think of is that the data you store is still distributed across multiple servers and can’t be removed or tampered with easily.

That's what every distributed database in the world does.

I don't understand what you mean by this. To my understanding, the companies' transactions/data are either on the Ethereum blockchain or not. Do you mean that they are using some other type of distributed ledger algorithm unconnected to Ethereum?

It's not, they're on enterprise eth, it's just being used to hype regular eth

By joining the EEA you are not committing to use the public Ethereum blockchain.

In most cases, I think companies are likely to use the Ethereum codebase and run their own private chain using their own servers.

That mostly defeats the purpose of a blockchain, but it arguably still provides more security than using a single, centralized database somewhere.

You can use the Ethereum project code to speed up and reduce the cost of development, since a lot of man-hours has gone into R&D by the Ethereum foundation (you fork the codebase). Ethereum is open source, anyone can do this. EEA members will likely run private, permissioned blockchains, likely using proof of stake or some other energy efficient consensus mechanism.

When you use a private blockchain, I like to think of it as being a bit like using a corporate intranet vs the public internet. It's disconnected, but it's possible at some point that data will flow across the public Ethereum blockchain if it's in the members' interest.

For example, imagine a private, permissioned blockchain using proof of stake for the insurance industry[1]. Since it's permissioned, only the major players get invites, and since they know each other, trust is higher than on a public blockchain. Each player has a certain number of shares/tokens, used to validate transactions. They use this to streamline their business. At some point (purely speculative on my part) they may wish to share information with some other entity who is not a part of their private blockchain. It's possible that data from the private blockchain could pass along the public Ethereum blockchain at this point, perhaps to an external auditor, regulator, other financial institution, etc.

[1] There is a proof of concept in this vein- http://www.swissre.com/reinsurance/insurers_and_reinsurers_l...

>> maybe just participate to get in on the hype and explore their options.

Yes. Or rather a small group in the company, that is trying to get political advantage, improve its profile, or simply impress the boss' boss, put together a convincing internal reason to join the alliance, and with high enough backing it becomes real. Something like that project was undoubtedly tried in every major bank and finance house - the few that got through shows that the internal decision making at those other places is actually working quite well :-)

EDI and other JIT Hub technologies have nonrepudiation as a core feature. I always wondered if blockchain could be adapted for that. If so then it would make sense for almost every B2B interaction.

I thought this Factom video was interesting, describing how companies like BoA paid billions of dollars in fines due to fraud in mortgages. Presumably, if the documents were on the block chain this could be adverted.

https://youtu.be/2Dj3qZeSLdY

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