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> Banks dragged down by capital obligations from Dodd-Frank regulation are looking everywhere for cost savings. Name a single bank who is using blockchain in a

by mifeng 9y ago

> Banks dragged down by capital obligations from Dodd-Frank regulation are looking everywhere for cost savings. Name a single bank who is using blockchain in an essential component of their operations (not just a proof of concept). Go on, I'll wait. Sure, blockchain is "interesting" and the people involved are "brilliant" but where is it delivering a 10x improvement over the status quo? Blockchain is a classic example of a solution looking for a problem.

SirensOfTitan 9y ago
> Name a single bank who is using blockchain in an essential component of their operations (not just a proof of concept). Go on, I'll wait. What a ridiculous argument. With blockchain really just becoming interesting over the last 2 years, you think banks, many of which use systems 20-30 years old (bonds are still primarily traded over phone) are going to switch over to it immediately. Give me a break. > Sure, blockchain is "interesting" and the people involved are "brilliant" but where is it delivering a 10x improvement over the status quo? International bank transfers can take days, have large transaction fees, and have a non-trivial amount of book keeping error. Whenever those same transactions could take 30 minutes with no human oversight I'd say the speedup is much higher than 10x. With that, it seems like you're more interested in making claims without being properly educated on what you're talking about.
- tptacek 9y ago
  This is what the supporters of limping technologies always say: "it's only been seriously considered for the last year or two, so it's too early to consider the results". And yet clearly, it has not been just 2 years over which we've considered blockchains. Why are blockchains more credible than all the other failed technologies for which these kinds of arguments are made? Whatever problems you may have with international bank transfers, they work: every business in the world relies on them. For all the supposed benefits of blockchains, no blockchain solution can make that claim, or any claim close to it.
- kjksf 9y ago
  The slowness and cost of international bank transfers has nothing to do with technology used. We could make a million of such transactions per minute using $1000/month hosted server. We have the technology. The problem is legacy infrastructure and the fact that banks benefit from high fees on international transfers. There is at least one successful business (transferwise) that makes international transfers much cheaper and faster using terribly inefficient work-arounds. If banks were at all motivated to fix the issue, they would, using Java and a database. They don't need blockchain (which, btw, is slower to settle a transaction than updating a record in a database).
- mifeng 9y ago
  International money transfer is indeed a big problem, and TransferWise has built a billion-dollar company over the past 6 years solving it, just not with blockchain.
  - AstralStorm 9y ago
    Heck, even Paypal is a smaller scale solution to this problem. Not to mention much more broken Western Union transfers. It is not like the problem hasn't been attacked many times from different angles.
- pron 9y ago
  Are you trying to present blockchain as a technical solution to a legacy software issue? Clearly, there are other, far simpler solutions, and clearly this is not the real motivation behind blockchain. I think Bray's main argument is that the motivation behind blockchain -- decentralized trust -- is something we don't really need. Rather than just state this as an opinion, he points out that even blockchain's supporters haven't been able to demonstrate a need.
cocktailpeanuts 9y ago
Maybe the confusion comes from how people are using the term "Blockchain", which actually is technically a term tied to Bitcoin but hijacked by VCs to create hype around it. But I agree with you that "Blockchain is a classic example of a solution looking for a problem" assuming you're talking about the hijacked usage of "blockchain". > Name a single bank who is using blockchain in an essential component of their operations (not just a proof of concept). Go on, I'll wait. I think this is exactly the point. Banks trying to employ their own blockchain is the same as companies trying to employ "Intranet" when the Internet first came out. It won't work.
- deleted 9y ago
  [deleted]
tupshin 9y ago
I don't know of any in active production, but I know of many banks and multiple banking consortiums that are investing lots of IT dollars on near-term blockchain deployments, and potentially at massive scale.
placeybordeaux 9y ago
For bitcoin to succeed it doesn't have to be used by banks. Banks already have a system set up that relies on trust and enforcement of contracts. I'd say that bitcoin has already succeeded, just not for the use cases that the author cares about.
- pron 9y ago
  > I'd say that bitcoin has already succeeded, just not for the use cases that the author cares about. It's not a matter of caring. He points out that whatever uses blockchain has (or hasn't) proven successful for, don't amount to a significant economic (or social) contribution. He's talking about objective quantity, not subjective quality.

by mifeng 9y ago

SirensOfTitan 9y ago

> Name a single bank who is using blockchain in an essential component of their operations (not just a proof of concept). Go on, I'll wait. What a ridiculous argument. With blockchain really just becoming interesting over the last 2 years, you think banks, many of which use systems 20-30 years old (bonds are still primarily traded over phone) are going to switch over to it immediately. Give me a break. > Sure, blockchain is "interesting" and the people involved are "brilliant" but where is it delivering a 10x improvement over the status quo? International bank transfers can take days, have large transaction fees, and have a non-trivial amount of book keeping error. Whenever those same transactions could take 30 minutes with no human oversight I'd say the speedup is much higher than 10x. With that, it seems like you're more interested in making claims without being properly educated on what you're talking about.

tptacek 9y ago
This is what the supporters of limping technologies always say: "it's only been seriously considered for the last year or two, so it's too early to consider the results". And yet clearly, it has not been just 2 years over which we've considered blockchains. Why are blockchains more credible than all the other failed technologies for which these kinds of arguments are made? Whatever problems you may have with international bank transfers, they work: every business in the world relies on them. For all the supposed benefits of blockchains, no blockchain solution can make that claim, or any claim close to it.
kjksf 9y ago
The slowness and cost of international bank transfers has nothing to do with technology used. We could make a million of such transactions per minute using $1000/month hosted server. We have the technology. The problem is legacy infrastructure and the fact that banks benefit from high fees on international transfers. There is at least one successful business (transferwise) that makes international transfers much cheaper and faster using terribly inefficient work-arounds. If banks were at all motivated to fix the issue, they would, using Java and a database. They don't need blockchain (which, btw, is slower to settle a transaction than updating a record in a database).
mifeng 9y ago
International money transfer is indeed a big problem, and TransferWise has built a billion-dollar company over the past 6 years solving it, just not with blockchain.
- AstralStorm 9y ago
  Heck, even Paypal is a smaller scale solution to this problem. Not to mention much more broken Western Union transfers. It is not like the problem hasn't been attacked many times from different angles.
pron 9y ago
Are you trying to present blockchain as a technical solution to a legacy software issue? Clearly, there are other, far simpler solutions, and clearly this is not the real motivation behind blockchain. I think Bray's main argument is that the motivation behind blockchain -- decentralized trust -- is something we don't really need. Rather than just state this as an opinion, he points out that even blockchain's supporters haven't been able to demonstrate a need.

cocktailpeanuts 9y ago

Maybe the confusion comes from how people are using the term "Blockchain", which actually is technically a term tied to Bitcoin but hijacked by VCs to create hype around it. But I agree with you that "Blockchain is a classic example of a solution looking for a problem" assuming you're talking about the hijacked usage of "blockchain". > Name a single bank who is using blockchain in an essential component of their operations (not just a proof of concept). Go on, I'll wait. I think this is exactly the point. Banks trying to employ their own blockchain is the same as companies trying to employ "Intranet" when the Internet first came out. It won't work.

deleted 9y ago
[deleted]

tupshin 9y ago

I don't know of any in active production, but I know of many banks and multiple banking consortiums that are investing lots of IT dollars on near-term blockchain deployments, and potentially at massive scale.

placeybordeaux 9y ago

For bitcoin to succeed it doesn't have to be used by banks. Banks already have a system set up that relies on trust and enforcement of contracts. I'd say that bitcoin has already succeeded, just not for the use cases that the author cares about.

pron 9y ago
> I'd say that bitcoin has already succeeded, just not for the use cases that the author cares about. It's not a matter of caring. He points out that whatever uses blockchain has (or hasn't) proven successful for, don't amount to a significant economic (or social) contribution. He's talking about objective quantity, not subjective quality.