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Nine of World's Biggest Banks Create Blockchain Partnership
An anonymous reader writes: Nine major banks, including Barclays, Goldman Sachs, Credit Suisse, and JP Morgan have teamed up to bring Bitcoin's blockchain technology to financial markets. "Over the past year, interest in blockchain technology has grown rapidly. It has already attracted significant investment from many major banks, which reckon it could save them money by making their operations faster, more efficient and more transparent." Leaving aside the question of whether banks actually want to become more transparent, they're funding a firm dedicated to running tests on how data can be shared and collected through the blockchain. "The blockchain works as a huge, decentralized ledger of every bitcoin transaction ever made that is verified and shared by a global network of computers and therefore is virtually tamper-proof. ... The data that can be secured using the technology is not restricted to bitcoin transactions. Two parties could use it to exchange any other information, within minutes and with no need for a third party to verify it."
Blockchain patents incoming.
I am a free slashdotter. I will not be modded, blogged, DRM'd, patented, podcasted or RFID'd. My life is my own.
"The data that can be secured using the technology is not restricted to bitcoin transactions. Two parties could use it to exchange any other information, within minutes and with no need for a third party to verify it."
The best feature of Bitcoin has been its use as a proving ground for blockchain technology. Now that it has survived several years of the intensive hacking attempts that a virtual currency would obviously be first to undergo, banks are starting to deem it ready to track other kinds of transactions.
Razormind, Ethereum, Eris Industries et al have been working on decentralized systems for nearly two years now. Eris released their DApp server for exactly this usecase and are working in the States to spread word of the tech. Ethereum recently pulled into release mode, and their decentralized system for smart contracts is slowly gaining momentum. Razormind has been working on a Decentralized Operating System which is driven by blockchains. The banks have only recently moved into the space properly - there was a $30m investment in Chain by Citi et al a few days ago - but folks like UBS and Barclays have been setting up blockchain labs and accelerators in London to investigate the possibilities.
Bitcoin is about losing control to anyone and open access.
You can delete all the spend output and keep only the unspend one. This is well documented. If I give 1$ to Bob, and Bob to Alice. The first transaction can be deleted safely if you know the transaction from Bob to Alice was ok.
The concept of mining was to bootstrap the currency. How do you start it? who have how many? The big bank all start with 1 billion? They transfert a real billion to who to get the virtual currency? If they transfer the real money in a "pot", that would be a system the ACH in USA. Someone do control the pot. This has nothing to do with a decentralised blockchain.
The concept of mining CANNOT be removed that easy.
blockchain bail-out
Nothing is real and nothing to get hung about
Strawberry Fields forever
Are they ignoring the proof-of-work or what? That's not efficient at all. By design.
CLI paste? paste.pr0.tips!
I wonder if this is coming about because of Mr. Robot ? Prevent someone from destroying all their data/backups :P
Morality is irrelevant to bookkeeping.
If you start out with enough money you can game anything because you make the rules.
exact, the same way if you received a 20$ bill that was used in a drug transaction before. It's called fungibility and it's very important.
This is a sign of Bitcoin maturity.
It's also a sign of major players seizing control.
There's going to be a new BankBitcoin. It'll be better and more monetizable and under control, with hookers and blackjack!
There are two different concepts. Bitcoin is a digital "currency". It happens to use a block chain to publish a record of transactions in that currency. Currency and transaction records are two different things. A digital currency doesn't have to use a block chain, and a block chain doesn't have to be tied to a currency.
The "proof of work" is used for the CURRENCY, to avoid having a limitless supply of Bitcoins. You want to limit people's ability to produce new bitcoins. You don't need (or want) to limit people's ability to validate the transaction history, which is what the block chain is for.
The banks might use a block chain to publish a record of US dollar transactions. Maybe they'll have a chain for Tesla stock, so when your monthly retirement savings occurs it'll record "fisted bought 10 shares of Tesla". Rather than recording transactions that occur in Bitcoins, the chain will record transactions of TSLA.
There's no new digital currency involved, so no "proof of work" is relevant. All that's needed is a way to validate the statement that you are the new owner of the stock. So in this example, Alice is now retired, so she sells her 10 shares of Tesla. You buy them. THAT is the transaction which gets added to the block chain. There's no currency being generated.
Bitcoin is a digital "currency". It happens to use a block chain to publish a record of transactions in that currency. Currency and transaction records are two different things. A digital currency doesn't have to use a block chain, and a block chain doesn't have to be tied to a currency.
The banks might use a block chain to publish a record of US dollar transactions, or stock transactions. Maybe they'll have a chain for Tesla stock, so when your monthly retirement savings occurs it'll record "JcMorin bought 10 shares of Tesla from Alice". Rather than recording transactions that occur in Bitcoins, the chain will record transactions of TSLA.
All that's needed is a way to validate the statement that you are the new owner of the stock. So in this example, Alice is now retired, so she sells her 10 shares of Tesla. You buy them. THAT is the transaction which gets added to the block chain. There's no currency being generated.
You can do it but that would cost you a lot of money as the amount of data stored is limited to 80 bytes per transaction and the transaction fee is proportially of the size of the transaction. :)
1 gig of data would be 12.5 millions transactions.
If you spend 0.00001 BTC in fee per transaction that would cost you 125 BTC or 28 426$
They might use block chain technology to track their own transactions. They don't care about bitcoin.
I think the banks should pre-pay the eventual millions/billions of dollars they will eventually be fined for whatever nefarious purpose this will be used for. They can write it off their books early, we can avoid lengthy trials and endless bloviating about how "something must be done to rein in the financial system", and we can all just admit that it's going to happen anyway so why not get ahead of the curve?
Because people connect systems like poor security to the internet. The blockchain doesn't can't discriminate between a transaction that involved a transfer of dollars first or not. All it cares about is if the chain of ownership is valid. You can only steal a bitcoin if the person you're stealing it from has a bitcoin to be stolen.
Nobody has ever hacked the blockchain or bitcoin itself. Only systems that utilize bitcoin.
And nobody has ever "disappeared" with a bitcoin. It's still traceable trough the blockchain. They may send a millionth of the amount to a million different addresses, or choose to lay low and not create a new transaction for years, but it's all still there.
And how is that any worse than today, where any bank can change internal records unilaterally, and we rely on an infrequent audit to catch it?
That simple-majority rule is configurable, being just a convenient way to decide which competing blockchain to accept if it diverges for any reason. In this implementation, it's fairly straightforward to resolve, since we already have a centralized auditor: the US government (in various offices for various jurisdictions). If any participants' blocks cause the chain to diverge, both sides of the disparity get an audit.
This violates Bitcoin's rule against central authority, but we don't really care much, because our goals are different. With Bitcoin, the goal is to avoid government. With this blockchain transaction system, the goal is to avoid on a third party for routine operations. Transactions would be validated in blocks, and each bank would ideally unanimously verify each others' findings. The tedious third-party validation need only happen if banks disagree... and that would mean something failed in a big way, so it's probably a government matter.
You do not have a moral or legal right to do absolutely anything you want.
"Morality is irrelevant to bookkeeping."
All legislation is someone's morality.
Bookkeeping rules are, essentially, legislation. Even the GAAP standards are either required or recommended in legislation.
Morality, specifically being honest, is at the heart of the science and genesis of accounting. Its abuse does not change that.
deleting the extra space after periods so i can stay relevant, yeah.
Ok I'm a bitcoin fan-boy, I will say that bitcoin is an experimental currency. All other have infinite supply, and this one doesn't. Let the game play and see the result in the long terme. By the way this is many clone of Bitcoin including some without any limit.