back to article Don't let banks fool you, the blockchain really does have other uses

It is a truth universally acknowledged that executives in the financial sector are capable of making the most exciting innovations boring, and in this respect their approach to the blockchain has been exemplary. During 2008's financial crash, a nine-page paper titled Bitcoin: A Peer-to-Peer Electronic Cash System [PDF] was …

  1. Kraggy

    Of course, now that Accenture have filed a patent for an EDITOR the entire value of this technology just plummeted as it's no longer possible to believe that the chain isn't 'hackable'.

    1. Anonymous Coward
      Anonymous Coward

      If it's editable it's not a blockchain, it's a database.

  2. Sorry that handle is already taken. Silver badge

    lol

    The point of a blockchain is that it is a trustless and decentralised database, and it makes huge usability and efficiency compromises to do this.

    I'm not a banker, but I'd be surprised if banks need either of those things...

  3. tony2heads
    Alien

    4D printing

    I think it is wanted on Magrathea

    1. frank ly

      Re: 4D printing

      It's 3D printed objects that change (fall apart) as time goes by. Already been done.

      1. Anonymous Coward
        Joke

        Re: 4D printing

        What you want is a 4.5d printing, as with a whole extra fourth dimension, you also want the other half a dimension, time.

    2. Doctor Syntax Silver badge

      Re: 4D printing

      Given that it's so slow I think alleged 3D printing is already 4D.

  4. Mage Silver badge

    Totally Niche

    It's not scalable. It only suits small, anonymous, distributed applications needing peer-to-peer communications.

    Because it stores every transaction and every copy needs updated the performance dies as the history and number of users grows. Bitcoin has a worse problem than even the blockchain, it runs out of coins eventually and the coin generation mechanism is stupid.

    A decentralised database for a world currency would need something completely different to Blockchain. Something akin to how a combination of IBAN and DNS works, hierarchical and regionalised. There is no governmental application at all not served better by a conventional secured client - server model.

    Bitcoin as it is, is doomed to be a speculation vehicle, money laundering and also essentially a pyramid scheme. Tulips.

    1. Dani Eder

      Re: Totally Niche

      > it runs out of coins eventually

      A bitcoin is divisible to 8 decimal places. If we use the last 2 as the equivalent of cents/pence, then the 21 million minable bitcoins supply 21 trillion "bits" (the name for a micro-bitcoin). That's equivalent to the whole world's M1 money supply in dollars/euro/pounds. Surely that's more than enough for a "niche" currency.

      Bitcoin's best use is to transmit funds from place to place. So, for example, one business uses it for remittances from workers in South Korea and other Asian countries to their families in the Phillippines. The bitcoins are invisible to the customers, they put in local currency at one end, and get out local currency at the other end. They use it because the fees are much lower than Western Union or bank wires. Maybe remittances are a niche, but they're a $500 billion a year niche. International payments of all kinds are difficult and expensive. Since bitcoin is borderless and relatively cheap to transmit, there is a case for using it.

  5. Anonymous Coward
    Anonymous Coward

    Not totally useless

    Bitcoin can be used for any number of purposes: from validating a patent application (in the form of a mined block added to the blockchain corresponding to the CRC32 of a document) to large property transactions, to secure payment of mortgage stamp duty, income tax, universal credit... The uses are literally endless.

    Someone did suggest using BTC as a way for people to pay child support without having to reveal that they are in fact the child's biological father (handy, and far more equitable) as the payment could be fixed so parents can know exactly how much money is being contributed at a given time for tax and benefits purposes. If it helps reduce dependence on the state I am all for this.

  6. Bob Rocket

    Blockchain <> Bitcoin

    Bitcoin is a demonstration app that runs on a Blockchain.

    It was chosen because most people have an understanding how cash transactions work in the physical world and Bitcoins are the direct digital analogue of (verifiably genuine) cash in the virtual world.

    Bitcoins suffer from all the same problems that physical cash does with the exception of counterfeiting.

    The Blockchain itself has nothing to do with Bitcoins or money but the financial institutions can't get their head around that.

    If you point to a mil-spec screw on a Tornado, you can find out exactly where and on which plane every screw is that came from that batch, there is a vast paper chain between the design, the factory and the plane for every component - full traceability.

    That's an app that could use a blockchain and has nothing to do with money.

    1. Doctor Syntax Silver badge

      Re: Blockchain <> Bitcoin

      "If you point to a mil-spec screw on a Tornado, you can find out exactly where and on which plane every screw is that came from that batch, there is a vast paper chain between the design, the factory and the plane for every component - full traceability.

      That's an app that could use a blockchain and has nothing to do with money."

      In other words, a solution to an already solved problem.

      1. Bob Rocket

        Re: Blockchain <> Bitcoin

        It's a productivity gain

      2. Julz

        Re: Blockchain <> Bitcoin

        Hum, but that 'solution' is SAP.

      3. Anonymous Coward
        Anonymous Coward

        Re: Blockchain <> Bitcoin

        How is using a blockchain to track parts to planes any better than using a database? Hint: it isn't. As always, blockchain is a solution looking for a problem.

        There is no reason for an organization to EVER use a blockchain for its internal needs. The only thing a blockchain provides you that you can't get elsewhere is basically a sequential log file that works in a decentralized and trustless environment. Two organizations with mutual distrust might have cause to use it for information they must share, but because it makes such an utterly shitty database, they'd probably agree to mutually trust a third party to maintain such data for them.

  7. Squander Two
    FAIL

    Must try harder

    The Register's really going downhill. If you're going to write a piece about financial services using blockchain tech, you should at least mention that Barclays just announced they've completed the world's first use of blockchain tech to execute a global trade transaction. Even if you mention it to say you think it's crap for some reason. By ignoring it, you just look uninformed.

    http://www.ibtimes.co.uk/barclays-wave-complete-worlds-first-blockchain-trade-finance-transaction-1580086#

    Currently trade transactions of this nature often involve a high number of participants in different jurisdictions around the world, which in turn requires a significant amount of paperwork, counter-signing and courier journeys.

    The new blockchain-based system developed by Wave uses distributed ledger technology to ensure that all parties can see, transfer title and transmit shipping documents and other original trade documentation through a secure decentralised network, eliminating many of the current inefficiencies in international trade. The new system could therefore speed up trade transactions, reduce costs for companies around the world and reduce the risk of documentary fraud, said the statement.

    Apparently, this pilot scheme got the transaction time down from ten days to under four hours. Sounds to me like they've found a viable use for the tech. Sure, you can claim that it could have been achieved with a transactional database if you like. But transactional databases have been around for years, yet, rather than adopting them, this trade has still stuck with a tedious and absurdly inefficient system of couriering physical paper around to be signed with pens. Could it be that the industry's experts can see a problem that transactional databases don't address and the blockchain does? It's a possibility. Would have been nice if you'd asked some of them.

    It rather appears that The Reg have spoken to a couple of people who can't think of what to do with blockchain and recklessly extrapolated that cluelessness to an entire industry.

    1. G Mac

      Re: Must try harder

      Seems a bit thin and maybe misleading...

      It looks like the documentation was hashed in the blockchain, not the funds itself which were sent via Swift - so technically the trade was documented by blockchain, but the trade was executed normally.

      So having completed a number of electronically signed documents amongst multiple parties (aka a mortgage), I guess the key for this is that it was distributed.

      But my understanding - correct me if wrong, is that verification of the blockchain must be done by some quorum of processors of which none have a majority (45%) of processing power. In this case, who did what to who? And how do you known given anonymity in the real world?

      I am curious to see how this could work in a distributed manner - that is after all the selling point beyond what is in place now.

      1. Anonymous Coward
        Anonymous Coward

        Re: Must try harder

        It looks like they use a blockchain for the part of this deal that stuff like DocuSign currently handles (for less sensitive stuff...I've used it for some real estate related transactions but the final step is still signing paper because that's all the county/state will accept currently) Blockchain probably offers some advantages over DocuSign for this type of use, but this is hardly a revolutionary thing.

        The only reason Barclays announced this was to cash in on the blockchain hype, and look like they are tech forward. They may have found a tiny niche where it is useful, but it is hardly going to be used for settling stock trades or credit cards, due to its massive inefficiencies in both transaction time and storage.

        1. Squander Two

          Re: Must try harder @ DougS

          @ DougS

          > They may have found a tiny niche where it is useful

          The global movement of goods: a tiny niche. Hmm.

      2. Squander Two

        Re: Must try harder @ G Mac

        > the documentation was hashed in the blockchain, not the funds itself which were sent via Swift

        Yes, which shows banks aren't stuck in a rut where they can't disassociate blockchain from the idea of virtual currency -- contrary to Bob Rocket's comment above that "The Blockchain itself has nothing to do with Bitcoins or money but the financial institutions can't get their head around that" and to this article's headline.

        > In this case, who did what to who? And how do you known given anonymity in the real world?

        I'd be interested to know too. Hence my annoyance at The Reg for not covering (and apparently being totally unaware of) what is currently the biggest news story concerning the topic this article is ostensibly about.

  8. Anonymous Coward
    Anonymous Coward

    block chain for property sales

    should be as default for the buying and selling of property, so away with at least half of the search fees and other legal BS fees...

    1. Sam Haine

      Re: block chain for property sales

      Good point. The relevant information needed to by a property is not going to be centralised anytime soon.

      1. Anonymous Coward
        Anonymous Coward

        Re: block chain for property sales

        Since it "is not going to be centralized anytime soon" it should be centralized on a blockchain?? How can you use a blockchain to verify i.e. there are no liens on the property unless all mortgages are recorded in that blockchain? How can you verify there are no encumbrances against sale like easements unless all are recorded in that blockchain? Etc.

        If you are centralizing all such information in a blockchain, why can't you centralize all that information in a database? The blockchain offers no advantages here, it is once again a solution looking for a problem.

  9. Almost Me
    Coat

    Blockchains need large numbers of untrustworthy people...

    The main problem the blockchain solves is a distributed ledger which it is computationally infeasible for any party to alter. Each block depends on the previous block, and is computationally expensive to create. For alteration to be infeasible, machines must continuously (and honestly) creating new blocks faster than any attacker can. If this requirement isn't met, the attacker can create an alternative block chain which, if it becomes longer than the genuine one, will supplant it.

    If only a small number of computers are involved, then each of the nodes has to be trusted. Otherwise recent block chain entries can be rewritten by anybody with a credit card and an AWS account. But if there are only a small number of trustworthy parties, digital signatures and trusted timestamp servers will also work and not require any significant computing resources.

    So for a blockchain to be the better solution you need a large number of untrustworthy people who have an economic incentive not to cheat...

    The really neat aspect of Bitcoin is the economic incentives it provides for nodes (untrusted people) to join the network and to "mine" new blocks honestly.

    But most proposed blockchain applications neither provide the incentive not to cheat nor allow untrusted nodes to join their network. Their main purpose seems to be to separate naive investors from their money.

  10. Anonymous Coward
    Anonymous Coward

    In other news

    In the event of time travel being discovered, an attacker *might* be able to use hardware which is essentially worthless now (eg Block Erupters circa 2013) and simply go back to a time where they are, or send the signals needed through an entanglement link and CTC arrangement assuming ER=EPR applies across a temporal as well as spatial domain which is just conjecture at this point.

    Is there a way to detect that this has been done or not?

    Also there was concern that folks buying the older generation of boards used are not yet aware that the chips do in fact "wear out" due to electromigration and I have here a box of graphics cards that some phool used for mining and burned out well before their time.

    I have implemented a fix for the memory issues which is to buy new chips and BGA rework them (requires BGA reball, rework station and X-ray inspection but is still doable)

    In fact to make a BTC miner using lots of identical older generation laptop boards (eg HP x50) and install Phenom P920's as they are low power and quite robust for a 2011 chip is feasible, albeit pointless because a single graphics card for £400 has 25* the mining speed for 3% of the power usage.

    1. Anonymous Coward
      Anonymous Coward

      Re: In other news

      Repairing these without component replacement is feasible and the same method can verifiably be used to repair OLED screens with pink line syndrome and also regenerate screen burn.

      It turns out that this is well known and already implemented in every TV sold after 2015, but this was only discovered after doing a patent search and finding my method was already in use thanks to a linked arXiv paper.

      I did notice that one method which is not routinely used is tuned NIR exposure with the inverse colour (eg red) turned on to provide biasing for the other colours and help reverse the electromigration without violating the patent at least in principle.

      Takes about a week to noticeably reverse blue burn-in by around 10% so this could be done with banks of screens ready for refurbished phones.

      Helps if the red is only turned on around the damaged area as this prevents more damage, seems to be broadly similar to rowhammer here at least as far as the same physics applies.

      Someone's actually offered to let me test this on their S7 Edge as the line has damaged their screen so the phone is basically worthless until repaired (£229+)

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