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Consensus in a distributed system is not the innovation of Bitcoin, just propose a new block and let all parties digitally sign the block if they consider it va

by danbruc 11y ago

Consensus in a distributed system is not the innovation of Bitcoin, just propose a new block and let all parties digitally sign the block if they consider it valid. If more than half of the parties have signed the block it is considered accepted. This of course requires knowing the parties because otherwise a single party could just cast arbitrarily many votes. And here lies the innovation of proof of work schemes, preventing one party from casting arbitrarily many votes by making votes expensive. This also is no innovation of Bitcoin, Bitcoin just put all the pieces together. But if you don't need pseudonymity and can know the involved parties there is no need for proof of work, i.e. you can easily replace mining with an identity verification process. And you get a system that is in some sense better because you remove the possibility to obtain more voting power by buying more hardware.

CydeWeys 11y ago
The system you're describing is not distributed, though. There has to be some centralized arbiter of which keys are considered valid members of the system. This list of keys is vetted and is kept up to date on all end systems. It doesn't work without that centralized arbiter because then you'd end up with situations where each party has their own separate list of other parties that they consider vetted, and this falls out of sync, and the blockchain completely falls apart as there is no longer consensus on whether any given block is valid or not. I will agree that the banks can probably come up with a centralized arbiter that works for them, and thus they don't need blockchain technology, but that isn't a counter to my assertion that the blockchain's key innovation is that it allows decentralization in a way that was never before possible.
- danbruc 11y ago
  You could and probably should just include the information about parties joining, leaving or changing keys in the blocks so that there is no ambiguity about the involved parties. The fundamental issue is really making sure that a new party is authentic and not the equivalent of a fake account of an existing party. You could come up with something like the process when verifying a domain for a certificate, creating a special DNS entry or serving some specific content at a specific address. This doesn't really work because nobody stops you from registering arbitrarily many domains, it is just meant as an example that the process does not necessarily require a central authority. But there is a hard problem here, who is a party and gets one vote? Could a bank just create ten shell companies and then obtain eleven votes? Bitcoin kind of sidesteps this problem by implicitly declaring you a separate party if you possess some mining hardware and weighs your voting power by the hash rate of your hardware. So you are definitely right, Bitcoin achieves a degree of distribution that is probably really hard to do without a trusted central authority that has the power to decide who is a separate party and who is not. If the number of parties is small you could maybe still do it in a distributed way with some manual work. If a new bank wants to join they broadcast a request, use something like the mentioned DNS record to prove that the request is genuine and then all existing parties have to manually decide whether to accept or reject the new party and cast a corresponding vote. But this obviously doesn't scale well.
- gamegod 11y ago
  Rather than everyone throwing their own half-correct answer into this thread, just read this: https://en.wikipedia.org/wiki/Proof-of-work_system https://en.wikipedia.org/wiki/Proof-of-work_system
- amalcon 11y ago
  Not necessarily. You could just have the members vote on whether to add or remove keys from a valid-key list. This basically amounts to putting the list of valid keys on the blockchain itself. There's a chicken-egg problem there that requires a central arbiter to bootstrap, but the central arbiter then immediately becomes powerless.
  - lifeisstillgood 11y ago
    That seems like a great idea ...
    - maaku 11y ago
      You might be interested in Sidechain Elements.
    - deleted 11y ago
      [deleted]
kordless 11y ago
The blockchain provides an immutable store of data. Access to that data may or may not be assured, but the data will be there regardless of whether it's accessed or not. An immutable data store of data would be a new type of storage system the world has never seen before. Up until now, things stored in a database have always had a decent amount of probability they wouldn't stay there forever. It would be nice to be able to pay a decent amount of stored value to keep some truths as universal truths, where the probability of losing those truths approaches zero. I think there are truths that are worth keeping around and ones that are not. Figuring that bit out is the next hard thing.

by danbruc 11y ago

CydeWeys 11y ago

The system you're describing is not distributed, though. There has to be some centralized arbiter of which keys are considered valid members of the system. This list of keys is vetted and is kept up to date on all end systems. It doesn't work without that centralized arbiter because then you'd end up with situations where each party has their own separate list of other parties that they consider vetted, and this falls out of sync, and the blockchain completely falls apart as there is no longer consensus on whether any given block is valid or not. I will agree that the banks can probably come up with a centralized arbiter that works for them, and thus they don't need blockchain technology, but that isn't a counter to my assertion that the blockchain's key innovation is that it allows decentralization in a way that was never before possible.

danbruc 11y ago
You could and probably should just include the information about parties joining, leaving or changing keys in the blocks so that there is no ambiguity about the involved parties. The fundamental issue is really making sure that a new party is authentic and not the equivalent of a fake account of an existing party. You could come up with something like the process when verifying a domain for a certificate, creating a special DNS entry or serving some specific content at a specific address. This doesn't really work because nobody stops you from registering arbitrarily many domains, it is just meant as an example that the process does not necessarily require a central authority. But there is a hard problem here, who is a party and gets one vote? Could a bank just create ten shell companies and then obtain eleven votes? Bitcoin kind of sidesteps this problem by implicitly declaring you a separate party if you possess some mining hardware and weighs your voting power by the hash rate of your hardware. So you are definitely right, Bitcoin achieves a degree of distribution that is probably really hard to do without a trusted central authority that has the power to decide who is a separate party and who is not. If the number of parties is small you could maybe still do it in a distributed way with some manual work. If a new bank wants to join they broadcast a request, use something like the mentioned DNS record to prove that the request is genuine and then all existing parties have to manually decide whether to accept or reject the new party and cast a corresponding vote. But this obviously doesn't scale well.
gamegod 11y ago
Rather than everyone throwing their own half-correct answer into this thread, just read this: https://en.wikipedia.org/wiki/Proof-of-work_system https://en.wikipedia.org/wiki/Proof-of-work_system
amalcon 11y ago
Not necessarily. You could just have the members vote on whether to add or remove keys from a valid-key list. This basically amounts to putting the list of valid keys on the blockchain itself. There's a chicken-egg problem there that requires a central arbiter to bootstrap, but the central arbiter then immediately becomes powerless.
- lifeisstillgood 11y ago
  That seems like a great idea ...
  - maaku 11y ago
    You might be interested in Sidechain Elements.
  - deleted 11y ago
    [deleted]

kordless 11y ago

The blockchain provides an immutable store of data. Access to that data may or may not be assured, but the data will be there regardless of whether it's accessed or not. An immutable data store of data would be a new type of storage system the world has never seen before. Up until now, things stored in a database have always had a decent amount of probability they wouldn't stay there forever. It would be nice to be able to pay a decent amount of stored value to keep some truths as universal truths, where the probability of losing those truths approaches zero. I think there are truths that are worth keeping around and ones that are not. Figuring that bit out is the next hard thing.