8 ms·

Microsoft and Bank of America collaborate with Azure Blockchain as a Service

131 points by spydum 10y ago

Osiris 10y ago
This is really interesting. I wonder if they would work to try to create a standard? If every bank creates their own blockchain system, that would only perpetuate or complicate inter-bank transactions.
- zappo2938 10y ago
  Is this a candidate for Request for Comments?
- wyldfire 10y ago
  I think this will come eventually. Ultimately I think they want to use the blockchain concept in order to make settlement easier. Ideally this should mean that a bank's retail and commercial customers should never know that settlement is taking place using a blockchain. Though there's always exceptions. Bitcoin delivers value in that its blockchain is secured by mutual participation among miners, exchanges, buyers and sellers, etc. All of these new commercial, independent "blockchain technology" buzzword press releases can only succeed if they can attract and sustain a critical mass of participants who have mutual interest in its success. It's not for me to say that they can't do that, I'm sure they can. But there will be many offerings over the next few years before a VHS/Beta or HD-DVD/BluRay battle of titans can emerge. EDIT: disregard most of this, according to comments elsewhere they're using Ethereum. shrug EDIT: re-regard most of this, apparently it's a private instance of Ethereum (IMO this is similar to Bitcoin's same-PoW altcoins).
- jcslzr 10y ago
  i think in a near future, big corporations will handle their own bitcoins to transfer money between countries
- ajdlinux 10y ago
  There's work being done by groups like R3 and the Linux Foundation Hyperledger along these lines.
DrHo 10y ago
Speaking of 'feathers': http://www.courthousenews.com/2013/12/03/63366.htm http://www.courthousenews.com/2013/12/03/63366.htm "..Bank of America charged hundreds of thousands of distressed homeowners millions of dollars for unnecessary house inspections that forced them to default on mortgages, according to a RICO class action.."
polskibus 10y ago
What does azure blockchain do? How is it related to Bitcoin? Isn't the whole point of blockchain the fact that it is a distributed ledger and centralizing it in one point like Azure reduces its appeal?
- Everhusk 10y ago
  Basically, it is a click-to-deploy blockchain node to the cloud. Saves the time of having to set all that up for yourself when you are building blockchain apps.
  - polskibus 10y ago
    Yes but is it Azure-specific blockchain which isn't compatible with sth like ethereum?
- spydum 10y ago
  Should mention you can also deploy to azure stack, which is basically onprem azure. So it's not all MSFT data centers
0x0 10y ago
What's the point of a private blockchain? Who are you competing against with your hash rate? And if you are keeping it private to stay in control, why choose a technology designed to not let you stay in control? I've heard buzz about "enterprise blockchains" several times, but I still don't understand what this brings that an authenticated REST service on top of an SQL database doesn't.
- rabboRubble 10y ago
  In finance, successful two party private systems / standards are often turned into industry standards. Think Swift, FIX, etc. In the case of FIX, the reason it was widely adopted was that a buy-side client (Fidelity) demanded their brokers (developed with Goldman, then taken up by others) adopt the standard. I understand why Microsoft would want to support this. I can understand why BoAML would want this. Where I'm failing to see how this initiative will succeed is there seem to be missing a buy side participant to demand implementation. Perhaps BoAML has some sort of leverage with other market participants to get them on board? Recording transactions from one arm of BoAML with another arm of BoAML doesn't make sense to me. There are already internal systems to handle transaction recording.
- conistonwater 10y ago
  Fees, dude, fees! (More directly, it's not easy to sell nor charge a lot of money for just a database, so this is a genuine advance in sales technique.)
  - wmf 10y ago
    I thought it's the opposite: banks want to stop paying fees to trusted third parties who run central settlement databases.
    - conistonwater 10y ago
      I might be confused: I thought the only reason those third parties were trusted in the first place was that they were co-owned by all the banks? My point was, you replace one cooperative system with another functionally equivalent one, and nothing much changes except that there are fees to be collected in the process. A centralized settlement system is like a commodity, it's standardized and cheap to run, but a blockchain can be sold. There's also an unjustified assumption that the new system wouldn't have banks paying fees, because blockchain. There's a long series of posts on Alphaville about just that. All those trust and legal issue don't just disappear.
onestone 10y ago
Btw, the blockchain in question is Ethereum. Source: https://twitter.com/HiroMarleyG/status/780713683022442496 https://twitter.com/HiroMarleyG/status/780713683022442496
- sidko 10y ago
  Just to clarify, this is NOT Ethereum, it is a fork of Ethereum, also referred to in that tweet reply as 'private Ethereum'. There is nothing called 'private Ethereum' - all Ethereum transactions are public. But lots of these enterprise blockchains fork from Bitcoin or Ethereum and create their private versions. This doesn't use ETH/ETC.
- ilaksh 10y ago
  Funny how Microsoft fails to mention that.
Eliezer 10y ago
I'm sorry, but seeing the phrase "blockchain as a service" has been the final straw causing my sanity to snap. brb, murder spree
- brighton36 10y ago
  I'm with you
csbrooks 10y ago
When they rolled out ECoin in Mr Robot, I thought it was a stretch...
- spydum 10y ago
  Seriously when I saw the announcement this morning, the Ecorp logo all of a sudden made sense.
dmak 10y ago
I'm not really familiar with the whole blockchain topic for banks. Could anyone out there explain it to me or direct me to some resources? Thanks in advance.
barisser 10y ago
Sorry but if Microsoft is doing it.... it's probably not going to be great.
- deleted 10y ago
  [deleted]
Animats 10y ago
Does the BofA "Azure Blockchain" have voting non-BofA nodes, or is it BofA-controlled? Suppose BofA wanted to roll back a transaction? Whose permission would they need? Is this the same blockchain as the HSBC/BofA blockchain intended for use for trade finance? There's a use for a blockchain where the voting members are, say, the top 20 banks worldwide. It would be tough to get more than half of them to agree to change something. If half of them agree to change something, it probably really needed to be changed.
- sanswork 10y ago
  When you know all the participants you don't need to roll back the chain you can just call the other side and tell them to add the inverse transaction. If they won't do it you have the courts to make them.
lordnacho 10y ago
I've yet to see a sensible use for what I consider to be an impressive achievement, the blockchain concept. So, what does it give you? An immutable, distributed, public database that can be trusted despite not having trust in any particular participant. Now, if you're a bank, why have you got offices with marble floors in the nicest neighborhoods? Why do your employees wear suits and ties? Why do you get a credit rating? If you want security, that already exists. You can use encryption to identify people, and you can use it to hide sensitive information. You can use it over public channels, no problem. For instance this forum is on an encrypted https connection, and people can't sit on the route between me and YC to find out what I'm up to. If you want a ledger, that's also been done. In fact you can use encryption to make sure there's never an unauthorized change to the ledger. And there's a whole load of ways that ledger can be scaled so that many people can use it at once. Someone mentioned settlement of trades as a potential use case. But what is really to be gained against the way it is currently done? At the moment, you have a bunch of ops guys settling trades in the way it's been done for many years. If there's an error, you can call someone one the other side and fix it. Mostly, it's automatic, done by various cron jobs. What do we get from putting that in something similar to bitcoin?
- atemerev 10y ago
  The current system implies that international banks and other financial institutions trust each other (or a designated neutral party), and it becomes increasingly hard to maintain that trust. (E.g. in light of recent attack of North Korea on Bangladesh central bank). Blockchain, in essence, is just a voter protocol that can deliver trusted consensus in adversarial (Byzantine) environment. This is its main value proposal for international finance. I'd also like to see a blockchain-based public voting and election protocol. But there seems to be not enough governmental interest in that ;)
  - ProblemFactory 10y ago
    In the Bangladesh central bank case, hackers broken into their internal networks, got access to payment credentials, and issued $950 million worth of transactions. $850 million was blocked before they went through, and about $40 million of the remaining has since been recovered. How would a blockchain have helped in preventing or recovering from this attack? If the hackers got access to their blockchain credentials, they would have been able to issue similar transactions. It would just have been much harder to block the transactions or reverse and recover them after the fact. It seems to me that running this on a blockchain would have made things worse, not better.
senthilvs 10y ago
is this gonna be compatible with (ripple) https://interledger.org/ https://interledger.org/ ? or yet another specification ?
deleted 10y ago
[deleted]
NOSHSHNACKERS 10y ago
Do I get 20% off if I use Ecoin?

131 points by spydum 10y ago

This is really interesting. I wonder if they would work to try to create a standard? If every bank creates their own blockchain system, that would only perpetuate or complicate inter-bank transactions.

zappo2938 10y ago
Is this a candidate for Request for Comments?
wyldfire 10y ago
I think this will come eventually. Ultimately I think they want to use the blockchain concept in order to make settlement easier. Ideally this should mean that a bank's retail and commercial customers should never know that settlement is taking place using a blockchain. Though there's always exceptions. Bitcoin delivers value in that its blockchain is secured by mutual participation among miners, exchanges, buyers and sellers, etc. All of these new commercial, independent "blockchain technology" buzzword press releases can only succeed if they can attract and sustain a critical mass of participants who have mutual interest in its success. It's not for me to say that they can't do that, I'm sure they can. But there will be many offerings over the next few years before a VHS/Beta or HD-DVD/BluRay battle of titans can emerge. EDIT: disregard most of this, according to comments elsewhere they're using Ethereum. shrug EDIT: re-regard most of this, apparently it's a private instance of Ethereum (IMO this is similar to Bitcoin's same-PoW altcoins).
jcslzr 10y ago
i think in a near future, big corporations will handle their own bitcoins to transfer money between countries
ajdlinux 10y ago
There's work being done by groups like R3 and the Linux Foundation Hyperledger along these lines.

DrHo 10y ago

Speaking of 'feathers': http://www.courthousenews.com/2013/12/03/63366.htm http://www.courthousenews.com/2013/12/03/63366.htm "..Bank of America charged hundreds of thousands of distressed homeowners millions of dollars for unnecessary house inspections that forced them to default on mortgages, according to a RICO class action.."

polskibus 10y ago

What does azure blockchain do? How is it related to Bitcoin? Isn't the whole point of blockchain the fact that it is a distributed ledger and centralizing it in one point like Azure reduces its appeal?

Everhusk 10y ago
Basically, it is a click-to-deploy blockchain node to the cloud. Saves the time of having to set all that up for yourself when you are building blockchain apps.
- polskibus 10y ago
  Yes but is it Azure-specific blockchain which isn't compatible with sth like ethereum?
spydum 10y ago
Should mention you can also deploy to azure stack, which is basically onprem azure. So it's not all MSFT data centers

0x0 10y ago

What's the point of a private blockchain? Who are you competing against with your hash rate? And if you are keeping it private to stay in control, why choose a technology designed to not let you stay in control? I've heard buzz about "enterprise blockchains" several times, but I still don't understand what this brings that an authenticated REST service on top of an SQL database doesn't.

rabboRubble 10y ago
In finance, successful two party private systems / standards are often turned into industry standards. Think Swift, FIX, etc. In the case of FIX, the reason it was widely adopted was that a buy-side client (Fidelity) demanded their brokers (developed with Goldman, then taken up by others) adopt the standard. I understand why Microsoft would want to support this. I can understand why BoAML would want this. Where I'm failing to see how this initiative will succeed is there seem to be missing a buy side participant to demand implementation. Perhaps BoAML has some sort of leverage with other market participants to get them on board? Recording transactions from one arm of BoAML with another arm of BoAML doesn't make sense to me. There are already internal systems to handle transaction recording.
conistonwater 10y ago
Fees, dude, fees! (More directly, it's not easy to sell nor charge a lot of money for just a database, so this is a genuine advance in sales technique.)
- wmf 10y ago
  I thought it's the opposite: banks want to stop paying fees to trusted third parties who run central settlement databases.
  - conistonwater 10y ago
    I might be confused: I thought the only reason those third parties were trusted in the first place was that they were co-owned by all the banks? My point was, you replace one cooperative system with another functionally equivalent one, and nothing much changes except that there are fees to be collected in the process. A centralized settlement system is like a commodity, it's standardized and cheap to run, but a blockchain can be sold. There's also an unjustified assumption that the new system wouldn't have banks paying fees, because blockchain. There's a long series of posts on Alphaville about just that. All those trust and legal issue don't just disappear.

onestone 10y ago

Btw, the blockchain in question is Ethereum. Source: https://twitter.com/HiroMarleyG/status/780713683022442496 https://twitter.com/HiroMarleyG/status/780713683022442496

sidko 10y ago
Just to clarify, this is NOT Ethereum, it is a fork of Ethereum, also referred to in that tweet reply as 'private Ethereum'. There is nothing called 'private Ethereum' - all Ethereum transactions are public. But lots of these enterprise blockchains fork from Bitcoin or Ethereum and create their private versions. This doesn't use ETH/ETC.
ilaksh 10y ago
Funny how Microsoft fails to mention that.

Eliezer 10y ago

I'm sorry, but seeing the phrase "blockchain as a service" has been the final straw causing my sanity to snap. brb, murder spree

brighton36 10y ago
I'm with you

csbrooks 10y ago

When they rolled out ECoin in Mr Robot, I thought it was a stretch...

spydum 10y ago
Seriously when I saw the announcement this morning, the Ecorp logo all of a sudden made sense.

dmak 10y ago

I'm not really familiar with the whole blockchain topic for banks. Could anyone out there explain it to me or direct me to some resources? Thanks in advance.

barisser 10y ago

Sorry but if Microsoft is doing it.... it's probably not going to be great.

deleted 10y ago
[deleted]

Animats 10y ago

Does the BofA "Azure Blockchain" have voting non-BofA nodes, or is it BofA-controlled? Suppose BofA wanted to roll back a transaction? Whose permission would they need? Is this the same blockchain as the HSBC/BofA blockchain intended for use for trade finance? There's a use for a blockchain where the voting members are, say, the top 20 banks worldwide. It would be tough to get more than half of them to agree to change something. If half of them agree to change something, it probably really needed to be changed.

sanswork 10y ago
When you know all the participants you don't need to roll back the chain you can just call the other side and tell them to add the inverse transaction. If they won't do it you have the courts to make them.

lordnacho 10y ago

I've yet to see a sensible use for what I consider to be an impressive achievement, the blockchain concept. So, what does it give you? An immutable, distributed, public database that can be trusted despite not having trust in any particular participant. Now, if you're a bank, why have you got offices with marble floors in the nicest neighborhoods? Why do your employees wear suits and ties? Why do you get a credit rating? If you want security, that already exists. You can use encryption to identify people, and you can use it to hide sensitive information. You can use it over public channels, no problem. For instance this forum is on an encrypted https connection, and people can't sit on the route between me and YC to find out what I'm up to. If you want a ledger, that's also been done. In fact you can use encryption to make sure there's never an unauthorized change to the ledger. And there's a whole load of ways that ledger can be scaled so that many people can use it at once. Someone mentioned settlement of trades as a potential use case. But what is really to be gained against the way it is currently done? At the moment, you have a bunch of ops guys settling trades in the way it's been done for many years. If there's an error, you can call someone one the other side and fix it. Mostly, it's automatic, done by various cron jobs. What do we get from putting that in something similar to bitcoin?

atemerev 10y ago
The current system implies that international banks and other financial institutions trust each other (or a designated neutral party), and it becomes increasingly hard to maintain that trust. (E.g. in light of recent attack of North Korea on Bangladesh central bank). Blockchain, in essence, is just a voter protocol that can deliver trusted consensus in adversarial (Byzantine) environment. This is its main value proposal for international finance. I'd also like to see a blockchain-based public voting and election protocol. But there seems to be not enough governmental interest in that ;)
- ProblemFactory 10y ago
  In the Bangladesh central bank case, hackers broken into their internal networks, got access to payment credentials, and issued $950 million worth of transactions. $850 million was blocked before they went through, and about $40 million of the remaining has since been recovered. How would a blockchain have helped in preventing or recovering from this attack? If the hackers got access to their blockchain credentials, they would have been able to issue similar transactions. It would just have been much harder to block the transactions or reverse and recover them after the fact. It seems to me that running this on a blockchain would have made things worse, not better.

senthilvs 10y ago

is this gonna be compatible with (ripple) https://interledger.org/ https://interledger.org/ ? or yet another specification ?

deleted 10y ago

[deleted]

NOSHSHNACKERS 10y ago

Do I get 20% off if I use Ecoin?