2 ms·

It's true miners have to have some incentive, and Bitcoin chooses to make that incentive a financial reward, but it's not the only possible incentive structure.

by vec 9y ago

It's true miners have to have some incentive, and Bitcoin chooses to make that incentive a financial reward, but it's not the only possible incentive structure. For example, imagine banks wanted to replace their clunky old ACH system with a blockchain. They could design their protocol such that it refuses to process transactions from or to an address that hasn't contributed a block to the chain in, say, the last 24 hours.. That requires each bank to contribute some minimum amount of computing power to maintaining the chain, even though it doesn't directly reward them for it. (I've spent literally 2 minutes thinking through this example. I'm sure it has some glaring holes in it. Still, I hope it illustrates the point.)

DSMan195276 9y ago
> For example, imagine banks wanted to replace their clunky old ACH system with a blockchain. They could design their protocol such that it refuses to process transactions from or to an address that hasn't contributed a block to the chain in, say, the last 24 hours.. That requires each bank to contribute some minimum amount of computing power to maintaining the chain, even though it doesn't directly reward them for it. But that is pretty much exactly my point. All that does is encourage people to mine just enough to keep the chain going, which does not ensure the security of the chain. There is no incentive to mine more blocks then anybody else. With that said, I think the exercise is a bit futile to begin with - if banks have a serious dispute between them, they're going to handle it in the courts, so at the end of the day the existence of the blockchain only serves the purpose of holding the transactions and hopefully allowing then to be done faster and more efficiently. Which, a regular database could do just the same - you could even use Merkle tree to hold the data to ensure you could verify that older data has not been changed (By having banks keep their own synced copy of the database). Basically a blockchain without the mining. It requires a certain amount of centralization, but since the only parties are banks it wouldn't be extremely hard to handle that part. Which, you could technically still call this a blockchain, but without the mining and a decentralized way of deciding which chain is correct I think that's a stretch for what most people think when they're talking about blockchain. Specifically, per your definition, the blockchain requires some type of PoW/proof-of-whatever and a decentralized consensus, which this doesn't have. And the above isn't actually all that theoretical. Ripple is a blockchain without a coin, but they fix the mining problem by not having any mining at all and instead having a central blockchain that they control. It's basically just an immutable database. So again, per your definition, they aren't really using a blockchain at all. And I'm not saying I disagree with your definition, but currently there are no examples of a decentralized blockchain using PoW that doesn't use a coin, even though there's basically everything else in-between. I'm honestly not convinced that that there are really any situations that don't involve a coin where the blockchain with mining is a viable option, and where there aren't any better alternatives that would make more sense.

by vec 9y ago

DSMan195276 9y ago

> For example, imagine banks wanted to replace their clunky old ACH system with a blockchain. They could design their protocol such that it refuses to process transactions from or to an address that hasn't contributed a block to the chain in, say, the last 24 hours.. That requires each bank to contribute some minimum amount of computing power to maintaining the chain, even though it doesn't directly reward them for it. But that is pretty much exactly my point. All that does is encourage people to mine just enough to keep the chain going, which does not ensure the security of the chain. There is no incentive to mine more blocks then anybody else. With that said, I think the exercise is a bit futile to begin with - if banks have a serious dispute between them, they're going to handle it in the courts, so at the end of the day the existence of the blockchain only serves the purpose of holding the transactions and hopefully allowing then to be done faster and more efficiently. Which, a regular database could do just the same - you could even use Merkle tree to hold the data to ensure you could verify that older data has not been changed (By having banks keep their own synced copy of the database). Basically a blockchain without the mining. It requires a certain amount of centralization, but since the only parties are banks it wouldn't be extremely hard to handle that part. Which, you could technically still call this a blockchain, but without the mining and a decentralized way of deciding which chain is correct I think that's a stretch for what most people think when they're talking about blockchain. Specifically, per your definition, the blockchain requires some type of PoW/proof-of-whatever and a decentralized consensus, which this doesn't have. And the above isn't actually all that theoretical. Ripple is a blockchain without a coin, but they fix the mining problem by not having any mining at all and instead having a central blockchain that they control. It's basically just an immutable database. So again, per your definition, they aren't really using a blockchain at all. And I'm not saying I disagree with your definition, but currently there are no examples of a decentralized blockchain using PoW that doesn't use a coin, even though there's basically everything else in-between. I'm honestly not convinced that that there are really any situations that don't involve a coin where the blockchain with mining is a viable option, and where there aren't any better alternatives that would make more sense.