IBM’s upcoming blockchain release could change the internet

Do you mean validity of transaction, identities, or both? Do you have a link you can send me that dicusses this in more detail? It’ll save me bothering you with inane questions :smile:

Yes, could be something like: “Delegated Proof of Stake (DPOS) is the fastest, most efficient, most decentralized, and most flexible consensus model available. DPOS leverages the power of stakeholder approval voting to resolve consensus issues in a fair and democratic way. All network parameters, from fee schedules to block intervals and transaction sizes, can be tuned via elected delegates. Deterministic selection of block producers allows transactions to be confirmed in an average of just 1 second. Perhaps most importantly, the consensus protocol is designed to protect all participants against unwanted regulatory interference.” –

But that feels potentially a bit semi-centralized to me. I hope IBM has come up with something new and really clever.

The blockchain is a bit of a hype. People are starting projects to open hotel doors using blockchain technology, or to “log on” to a car. And don’t get me started in the Internet Of Things. Why on earth do we want all sensors to send transactions to a blockchain and share it with the whole planet :joy: AirBnB is doing great without a blockchain, same for the stockmarket. I think blockchain will be around for a long time, it’s great for a community and voting etc. I also like the idea of Factom where you can put some hash into a chain, that’s a great idea. But for surfing, storage, the IoT and stuff, let’s use something different.

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I wouldn’t mind IBM using the SAFE network. :slight_smile: And with deduplication, running blockchains on the SAFE network will be a piece of cake I guess. EDIT: Except perhaps for the ownership of the blockchain data (needs to be decentralized), so IBM may have to fork the SAFE project and tweak it somewhat.

It’s the both. If you look for permissioned blockchain fintech you may be able to find a lot of musings on the supposed advantages of private blockchains in finance.

Edit: changed to permissioned from permissionless, for better search results


This talking point from Deutsche Bank sheds light on their motivations.

I don’t really feel comfortable about it though, I fear their success in creating permissioned blockchain systems might hinder the world’s potential move to trustless systems where the end-user is in control. That might mean we’d never get rid of all these parasitic unstable fractional-reserve too-big-to-fail banks.

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There’s nothing to worry about, permissioned ledgers are unlikely to succeed :slight_smile:

Can you explain why you think that?

To clarfiy, I’m worried about this:

Thus, it is entirely conceivable that banks could, for instance, set up a new digital booking and
clearing system amongst themselves enabling them to offer client transactions featuring the benefits of
the blockchain, such as speed, efficiency, internationality and cost savings. Since the banks most
likely trust each other more so than the anonymous peers, a new, modern clearing system would probably
in fact be even cheaper and more efficient than the blockchain, because the energy-hungry “proof of work”
(“mining” at Bitcoin) would be made redundant. Moreover, banks could configure their system in a
user-friendlier fashion for less tech-savvy customers and enhance their offer with extra personalised
financial services, which the blockchain cannot do as things stand today. With a new proprietary digital
IT infrastructure banks could thus quite conceivably be able to position themselves relatively well in
relation to the blockchain technology.

I suspect that banks will create their own bitcoin type networks with closed blockchains.

It is pretty darn good idea for them for their perspective. They can provide the benefits of Bitcoin (near instant transfer, very low fees,) without the problems of currency conversion and volatility etc…

Open source technology ought to raise all boats… Including banks and big corporations…

The problem is that they’re building another system which requires users to trust them.
The second problem is this is a crappy PoS approach in which security is inferior to what PoW offers.
The third problem is tokens can be created at will (and maybe next year they’ll charge negative interest rates to the savers, while at the same time doing QE for the banks).
Another problem is that they’re building a permissioned system, so anyone’s account can be confiscated, monitored, and transactions reversed.

It’s a complete disaster. The sheeple may use it, but won’t get any benefit from it.

By the way, there are many technologies that already provide everything once you strip the main benefits from blockchain. VISA Wave (I don’t use it but I see others do) works great. And most sheeple don’t receive other payments except paycheck so what other improvements do they need? Sure for the bank it’d be a bit more money, but to the user there’s no new features.

I don’t buy it…

If Visa puts out a system where the vendor sends a transaction to my card along with a nounce. My card signs it, and it is submitted to a blockchain. We have gutted the bulk of credit card fraud at it’s core. That may be a bigger benefit to the banks than to the users, but it sucks for the users too…

Being able to instantly transfer from one bank account to another via online banking would be totally do-able on a private blockchain. That would be a benefit for consumers.

The reality is that a lot of the Cryptotech can and will be used in traditional finance to bring value to users and to the bottom line of the institutions.

Reality is better than wishful thinking. It is what it is, we don’t have to like it.

It would be great if banks and other financial services could use the IBM blockchain to radically reduce, and hopefully even eliminate, the huge transaction fees for payments. Visa, Mastercard and others have transaction fees of several percent! Imagine one dollar being used as payment 100 times, then if the transaction fee is 3%, then the total transaction cost is $3 for a single dollar! Outrageous.

I didn’t say it won’t be doable. I said it will be monitored, censored, taxable and un-doable, so there’d no difference to the user vs. traditional methods except maybe a slightly lower cost (while the central bank is trying to destroy the value of the currency, so no charges with negative interest rates still means “excessive cost”).
(By the way, my bank today already doesn’t charge me anything for sending money to another account in the same bank, so if I gave a shit I could have zero fee transfers for most of my P2P transfers (to/from family members), but I don’t. I prefer to use cash. But many people care, so families tend to have accounts in the same bank and this new bankchain transfer stuff will have zero value for them.)

I don’t remember when I last heard that someone’s card was misused and that he lost money. In my bank smaller sums stolen through fraudulent transactions are instantly refunded no questions asked, larger sums are refunded too (but you may need to give a statement to the bank or police to answer some basic questions, if the amount is larger and the circumstances not clear.)

You live in a different reality. Where I live bank services are essentially free and I barely use them to begin with. I only have a mortgage which I hope to stop using (the sooner the better). I use a credit card ($100/month, mostly for international payments) and the rest is cash.

Unless you a libertarian, a drug dealer or tax evader, Most folks don’t care about the privacy issues.

Transferring P2P would be a benefit for nearly everyone. You could basically drop paypal out of the equation entirely and just transfer money via QR code.

You don’t lose money when your account is compromised – but you usually lose use of the card. And if you are a road warrior without a credit card for example that can make for a lot of hassle.

Most road warriors use corporate cards.

Like I said, I can do that today, it costs nothing if it’s the same bank and it’s instant during office hours.
My bank has one of those apps, it’s free to download and use.

Yes, which is why I said the sheeple will use these new services, but banks won’t gain any new customers. They may make a little bit more profit.

I am a road warrior and my corporate card was compromised. I assure you it was a massive pain in the rump. If that didn’t happen I would have been a much happier guy.

P2P transfers are not that easy right now. I can send it to certain users at certain banks. Fixing that is a good product however they do it. A blockchain solution would be a very effective solution. Remittences are still expensive, and they don’t need to be.

Argue if you want to argue. But I see value on the table. So do the banks. And they know their business better than you or I.

I am not contesting that. They’ll improve their bottom line and maybe pass part of the savings to the user.
The idiot politicians everywhere have been pressing banks to lower cc charges, so banks are looking around for ways to lower costs while still making the same (or larger) amounts of money.

There’s not much new for the customer in that. It’s like saying that private permissioned blockchain + Google drive eliminate the need for MaidSafe, or that private permissioned blockchains eliminate the need for permissionless cryptocurrencies.
In the latter case, if you want to stay in the crumbling fiat system (if which your entire bank may go bust overnight) just because they charge you 0.25% less, that’s your choice.

“More global banks back blockchain collaboration plan … Among the recruits are IBM’s blockchain head Richard Brown.” – More global banks back blockchain collaboration plan