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The ledger. I think people are so caught up with it being a currency or investment asset that they miss the real revolutionary ideas. Triple entry bookkeeping.

The ledger. I think people are so caught up with it being a currency or investment asset that they miss the real revolutionary ideas. Triple entry bookkeeping. When double entry accounting emerged in the renaissance it revolutionized commercial activity. I think there are use cases where being able to publicly verify transactions and history would be immensely beneficial. I worked as a lawyer in NYC unwinding many of the 2008 financial crises bankruptcies and can tell you that billions of dollars of mortgages, home deeds, commercial loans, etc are traded with bankers sending each other excel files. Which means that the property ownership is literally a spreadsheet (often with a date in the file name). It was shocking but how it was done. There are massive third party organizations that are tasked with tracking those transactions MERS. The commodities exchanges etc but they weren’t much better organized. Lots of excel files. So if there could be a common accounting ledger that could be verified it would be a big improvement. The question is though would that be 10x better? Or rather enough to get the various stakeholders to adopt the ledger. So far. No.

belter 4y ago
https://aws.amazon.com/qldb/?nc1=h_ls https://aws.amazon.com/qldb/?nc1=h_ls
elliekelly 4y ago
What about triple entry accounting requires the blockchain? Or how does triple entry accounting benefit from being on the blockchain? Or a distributed ledger in general? The shitty book keeping you encountered will always be cheaper, faster, and easier than the “better” alternative. The people like SBF with a black hole of excel nonsense as their “accounting system” aren’t going to be persuaded to take up triple entry accounting— on the Blockchain or otherwise.
- strangattractor 4y ago
  I don't think is does - but exposing too much data is a problem. The block chain can be public and still maintain a certain anonymity. If people see a lot of money going into a particular wallet they can ask the city to clarify where/why the money if being spent. It might be nice to see exactly how money is being spent for schools (payroll, facilities etc) for example. Block chain seem made for such a thing is all.
- digitaltrees 4y ago
  I am not aware of any other triple entry accounting system or proposal other than the block chain ecosystem. But I have been a crypto curmudgeon and skeptic so I don’t follow it closely. Honestly it was the only idea that didn’t make me throw up a little when I would talk to crypto fans. It was my little tactic to find common ground. Excel may be cheaper and faster for companies but governments care about legitimacy and could probably end up forcing implementation. So imagine that instead of county deed offices that have physical books dating back hundreds of years with title info, they had a blockchain ledger then the third party systems the evolved on top to make title transfer lowers friction will technically not being a true legal transfer could have a middle ground where the transaction has the certainty and legitimacy of a public record and the low friction of a digital transaction rather than physically having to go to each county to record the transaction. Similarly all large banks now have to submit stress tests to the federal reserve and one of the hardest things to do is trace asset transfers and liabilities to get at contagion risk. If regulators were smart they would mandate a blockchain or time series database so that unwinding transactions didn’t have to happen through junior attorney and bankers manual review of transfers in bankruptcy court.
  - marcus_holmes 4y ago
    I still don't understand why this is better on a blockchain than a database. Transactions are harder to do, they take longer, they're massively more inefficient, etc. And what do we gain from this? Blockchains are not immutable (as we've seen), they're usually controlled by a single entity or group of entities (as we've seen), they're public but in a bad way - as soon as the connection between a person and a key is revealed, that person's entire transaction history is revealed. And so on. I know that "all these problems are being solved" but you could solve them all in an instant by just using a database and having sufficient oversight over who gets to manage it. I don't understand the enthusiasm to use a blockchain here (or anywhere)
    - PKop 4y ago
      3rd party trust and central point of failure. I don't agree that we've seen Bitcoin be controlled by a single entity or that anyone has power to modify it against the will of market. I would argue the things you don't see a need for are necessary, if not sufficient, to have a sufficiently decentralized ledger. Network effect might be the other ingredient.
- RC_ITR 4y ago
  Everyone loves cryptography and the chain of blocks structure because they are good things Neither of those things are the defining feature of cryptocurrencies, decentralization is. Decentralization is one of the most pointless endeavors in technology, because it's so hard to scale anything decentralized (case in point, how expensive on-chain BTC/ETH transactions are).
  - lhl 4y ago
    No one cares about decentralization until there's a centralization failure, then those people are glad there's an alternative that others have been toiling away for for years, like with Twitter and the Fediverse. The entire Internet is built on various levels/degrees of decentralization, and while there are performance costs, it's still usually cheaper than the alternative in the long term.
    - RC_ITR 4y ago
      > No one cares about decentralization until there's a centralization failure It’s so wild to hear this, when, actually let’s just count some decentralized failures. 1) Remember when Solana just turned off? I bet you do since it happens so often. (I know, it’s the miners fault; crypto can never fail, only be failed) 2)Remember when Bitcoin hard forked 8+ times and many of those forks suffered 51% attacks due to lack of interest? If decentralization were good, then why does everyone centralize on the original chain? > The entire Internet is built on various levels/degrees of decentralization, and while there are performance costs, it's still usually cheaper than the alternative in the long term. Explain to me how many machines running at under 100% capacity is cheaper. Why does the cloud exist if that’s the case?
rwmj 4y ago
Couldn't that be more efficiently solved using a public database maintained by a trusted third party? We don't need a blockchain to know who owns shares for example.
- floober 4y ago
  Efficiently? Maybe. Providing the same type trust and guarantees? Probably not. A public, append-only Merkle tree just has a lot of interesting properties and I think there are spaces where they are useful.
- grp000 4y ago
  I'm just an engineer with no background in finance, but didn't a fair part of the 2008 collapse come about by trusted third party risk auditing that went bad? Rather than maintaining a centrality of trust at some level, it seems intuitive that if there is a public database with trust decentralized among all the participants, there is less of a chance for that trust to be abused.
  - blowski 4y ago
    Financial transparency and integrity is a wonderful goal. However, I am yet to understand why any kind of blockchain is necessary or sufficient, or even a good solution. If you want to cook the books you can do it with or without blockchain. Same if you want to be honest. Blockchain seems like a very complex and expensive way of persisting transactions in a database.
    - coffeebeqn 4y ago
      It’s just a fundamental naïveté about how the world works. If I’m dodging taxes or hiding profits then I’ll just enter false numbers on the blockchain. Now what good is the blockchain? Unless the whole world runs on the super inefficient blockchain system then there is always a potential for gigantic drift between the actual state of the world and the blockchain.
  - SideburnsOfDoom 4y ago
strangattractor 4y ago
I would agree. The whole currency thing is a sham. It has enabled some horrendous criminal financial activity. But when I think of state and local gov't making there ledgers public and preserving some anonymity of the payees. I see some really exciting prospects for transparency.
- strangattractor 4y ago
  https://www.theregister.com/2022/12/20/crypto_ponzi_scheme_cofounder_pleads/ https://www.theregister.com/2022/12/20/crypto_ponzi_scheme_c... https://www.justice.gov/usao-sdny/pr/us-attorney-announces-historic-336-billion-cryptocurrency-seizure-and-conviction https://www.justice.gov/usao-sdny/pr/us-attorney-announces-h... https://www.justice.gov/opa/pr/two-estonian-citizens-arrested-575-million-cryptocurrency-fraud-and-money-laundering-scheme https://www.justice.gov/opa/pr/two-estonian-citizens-arreste... https://mashable.com/article/biggest-crypto-scams-2022 https://mashable.com/article/biggest-crypto-scams-2022 Please post some links where Crypto is beneficial to anyone other than those that speculate in it.
formercoder 4y ago
Why can't we just have a better, trusted, third party? Any use case for Blockchain that does not use the phrase "zero trust" is not a real use case.
- acover 4y ago
  The merkel tree can be separated from the block creation. See aws qldb. https://aws.amazon.com/qldb/ https://aws.amazon.com/qldb/
- digitaltrees 4y ago
  Because separation of the record from the record keeper means the system will be endowed with new attributes such as accuracy, verification. distribution, longevity etc that result in a more robust and valuable system. Imagine you run a fast food franchise with 10 restaurants, each keeping their inventories in a local database, how do you coordinate global restocking? Manual reconciliation across each database. Ok move to the cloud. Now you have a global picture where state is adjusting in closer to real time and reconciliation is an inherent property of they system rather than a process implementation operationally. Well as I have described elsewhere in this thread. A lot of financial transactions are managed in an equivalent process of local databases with manual reconciliation. I am oversimplifying because there are a number of road blocks that prevent a solution like “implementing a cloud database” and also conflating what happens within a company (using the franchise analogy) rather than a market (where every single franchise had a common inventory and ordering system not tied to a third party supplier). By my point is that a block chain ledger would solve many of these problems without users even being fully aware of the problem in the first place.
  - peter422 4y ago
    There is no reason you can't mix the cryptological security of the Bitcoin Blockchain without the proof of work part. If I (a trusted third party) maintained a giant public database that anybody could append to, it would be trivial to release checksums or hash values at specific intervals to prove that nothing in the past was altered.
comte7092 4y ago
>Which means that the property ownership is literally a spreadsheet (often with a date in the file name) Are you implying that the spreadsheet is/was itself a legal document signifying ownership? Because that is radically different for my understanding of home ownership. I have never owned property, but to my knowledge ownership is conferred by way of a deed that is registered with the government. Which leads to the main issue with the crypto hype that I see. The majority of the space is taken up by two overlapping camps: get rich quick shills and techno libertarians who believe we’d have utopia if not for the pesky government.
- TheOtherHobbes 4y ago
  If there's a mortgage the deed is held by the mortgagee. Or at the very least there will be a formal legal claim on the deed (in the UK it's called a lien or a charge - not quite identical but similar) which isn't satisfied until the mortgage is paid off. Worse, there were instances in 2008 of banks stealing homes out from under people - who sometimes didn't even have a mortgage - by getting fake paperwork waved through, because it was impractical for all the competing claims on a loan to be properly validated. https://www.salon.com/2013/08/12/your_mortgage_documents_are_fake/ https://www.salon.com/2013/08/12/your_mortgage_documents_are... Would blockchain fix this? No. The problem wasn't tracking the transactions, it was the fact that banks and the financial industry fraudulently hid the true risk of various loan bundles. Blockchain would only have solved this problem if the loan context - creditworthiness, payment history, and so on - was included with every loan transaction, and could easily be accessed and summarised for all the transactions in all of the loan bundles. Which blockchain doesn't do. Coincidentally, this is exactly the same problem that blockchain hasn't solved for FTX, Binance, Mt Gox, etc. Blockchain does not provide an objective assessment of risk, value, or corporate credibility. It's just a ledger. Even if you can't manipulate the ledger, you can still manipulate the perceived meaning of the numbers in the ledger. Especially if you're a trusted party in the cryptoverse. In fact it doesn't just fail to fix these problems, it creates new opportunities for spectacular frauds.
  - digitaltrees 4y ago
    Actually yes the problem was tracking the transactions. There were literally competing spreadsheets that teams of lawyers had to argue about and reconcile by looking at emails between traders and comparing row by row. Have you ever tried to compare two spreadsheets? Lawyers know how to blackline two word docs. They don’t know how to compare two datasets programmatically. It’s part of the reason I started coding. I felt after charging $850hr to manually compare row level data across spreadsheets. In fact counts eventually started getting harder on banks, rejecting the argument that tracking transactions was impractical and ruling in favor of homeowners and making the banks eat the loss for their own shoddy paperwork. But for many it was too late.
hyperman1 4y ago
I see 2 core parts to cryptocoins: The Merkle tree for honesty and the Proof of work for value. I'd agree the Merkle tree is good as the ledger. AFAIK it is also used in certificate transparancy logs: Every block of log entries contains a cryptographic hash to a previous block, so you can't rewrite log entries, only append them. This is what guarantees honesty in the certificate world, and is I assume the only aspect you need for your proposal. But the Proof of work is basically a race to do as much computation as possible. This is the part that wastes so much energy and resources, the part that slows things down, but also the part that provides value to cryptocoins by proving that someone wanted to waste/spend the resources. Do you see value in a system that has both aspects?
- er4hn 4y ago
  I'll chime in here that Merkle trees are best used to tell you if something changed in the historical records. Certificate Transparency (CT) provides you with an easy to verify way to generate a single identifier that tells you the current state of a set of information. You can then incrementally add onto it while checking that none of the past information was changed during that addition. This is a pretty similar concept (and motivation) to Git. Where this becomes interesting is that someone can just change the past data, then go through and update all the subsequent additions to come up with a the new final value. CT handles this by having multiple other entities check that the CT root values are not changing over time. Git handles this by allowing for similar mechanisms - if you believe Linus he memorizes the root hash of his local repo before bed each night. A post-it note would work just about as well for the Linus/Git case, but I am getting off topic. I don't see value in proof of work because it assumes that any system would have more entities (where each entity has some amount of computing power..) watching than there is computing power attempting to rewrite it. That doesn't really scale up across most industries use cases. A set of say, mortgage companies, could just exchange data in a merkle tree format and raise an alarm if it looks like the values changed from the prior root. This is very fast and cheap to compute and doesn't require proof of work calculations.
- cma 4y ago
  Proof of work is to prevent double spend, not provide value in some other way--it wastes lots.
markwkw 4y ago
Home deeds, loans, mortgages are not accounting concepts, but more in the ... contract(?) land. When a loan is made, a loan document exists; and accounting entries exist somewhat separately. A contract can be entered without writing, a contract can result in complex accounting treatment which may be investigated, rules clarified, decided, corrected when methodology errors were made. Do you mean that the blockchain is supposed to help with the accounting side, or with the contract side, or both?
- ElevenLathe 4y ago
  I think the dream is something like making a single commit that updates your code and the documentation that is kept alongside it in the same repo. A blockchain transaction would represent the entire transaction including the mortgage agreement, the deed, the asset on the lender's books, and the liability on the borrower's books. I say dream because there's no real path to this ever happening, and it's definitely not happened yet.
- digitaltrees 4y ago
  These are separate things. The legal contract is separate from the legal document establishing ownership, separate from the government ledger which tracks the chain of ownership conveyed, separate from documents related to the performance of the contract such as installment payments, principal and interest balances, and lifting of the encumbrances such as liens. There are different systems and procedures for each. Some are fine. Some could benefit from a central ledger. Whether that’s a database or crypto I don’t really care. Just throwing the idea out there.
uberdru 4y ago
Ironically, perhaps not so much so, that's precisely why the blockchain was invented in 1992. A simple notary service.
jerrygenser 4y ago
Could these ledger be a log data structure in a single database that is run by a trusted entity like a government? Why does it need to be decentralized?
- mudrockbestgirl 4y ago
  What you want is full transparency and incentive alignment. A government, or rather the people running the government, fundamentally don't benefit from these things because they use monetary policy to benefit themselves and the elite that is currently in control. Of course they need to get re-elected, so they must make it so that the general population believes in their "goodness" - The fed is just a group a people making decisions behind close doors with who-knows-what political incentives. So yes, in theory it could be a centralized database but I don't think there exists this mystical "global trusted entity" that has the population's best interests as their main incentive because everything within a single nation state is clouded by politics. Banks and big tech are prime examples. That's why it needs to be decentralized, decoupled from specific governments and people in power.

belter 4y ago

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elliekelly 4y ago

What about triple entry accounting requires the blockchain? Or how does triple entry accounting benefit from being on the blockchain? Or a distributed ledger in general? The shitty book keeping you encountered will always be cheaper, faster, and easier than the “better” alternative. The people like SBF with a black hole of excel nonsense as their “accounting system” aren’t going to be persuaded to take up triple entry accounting— on the Blockchain or otherwise.

strangattractor 4y ago
I don't think is does - but exposing too much data is a problem. The block chain can be public and still maintain a certain anonymity. If people see a lot of money going into a particular wallet they can ask the city to clarify where/why the money if being spent. It might be nice to see exactly how money is being spent for schools (payroll, facilities etc) for example. Block chain seem made for such a thing is all.
digitaltrees 4y ago
I am not aware of any other triple entry accounting system or proposal other than the block chain ecosystem. But I have been a crypto curmudgeon and skeptic so I don’t follow it closely. Honestly it was the only idea that didn’t make me throw up a little when I would talk to crypto fans. It was my little tactic to find common ground. Excel may be cheaper and faster for companies but governments care about legitimacy and could probably end up forcing implementation. So imagine that instead of county deed offices that have physical books dating back hundreds of years with title info, they had a blockchain ledger then the third party systems the evolved on top to make title transfer lowers friction will technically not being a true legal transfer could have a middle ground where the transaction has the certainty and legitimacy of a public record and the low friction of a digital transaction rather than physically having to go to each county to record the transaction. Similarly all large banks now have to submit stress tests to the federal reserve and one of the hardest things to do is trace asset transfers and liabilities to get at contagion risk. If regulators were smart they would mandate a blockchain or time series database so that unwinding transactions didn’t have to happen through junior attorney and bankers manual review of transfers in bankruptcy court.
- marcus_holmes 4y ago
  I still don't understand why this is better on a blockchain than a database. Transactions are harder to do, they take longer, they're massively more inefficient, etc. And what do we gain from this? Blockchains are not immutable (as we've seen), they're usually controlled by a single entity or group of entities (as we've seen), they're public but in a bad way - as soon as the connection between a person and a key is revealed, that person's entire transaction history is revealed. And so on. I know that "all these problems are being solved" but you could solve them all in an instant by just using a database and having sufficient oversight over who gets to manage it. I don't understand the enthusiasm to use a blockchain here (or anywhere)
  - PKop 4y ago
    3rd party trust and central point of failure. I don't agree that we've seen Bitcoin be controlled by a single entity or that anyone has power to modify it against the will of market. I would argue the things you don't see a need for are necessary, if not sufficient, to have a sufficiently decentralized ledger. Network effect might be the other ingredient.
RC_ITR 4y ago
Everyone loves cryptography and the chain of blocks structure because they are good things Neither of those things are the defining feature of cryptocurrencies, decentralization is. Decentralization is one of the most pointless endeavors in technology, because it's so hard to scale anything decentralized (case in point, how expensive on-chain BTC/ETH transactions are).
- lhl 4y ago
  No one cares about decentralization until there's a centralization failure, then those people are glad there's an alternative that others have been toiling away for for years, like with Twitter and the Fediverse. The entire Internet is built on various levels/degrees of decentralization, and while there are performance costs, it's still usually cheaper than the alternative in the long term.
  - RC_ITR 4y ago
    > No one cares about decentralization until there's a centralization failure It’s so wild to hear this, when, actually let’s just count some decentralized failures. 1) Remember when Solana just turned off? I bet you do since it happens so often. (I know, it’s the miners fault; crypto can never fail, only be failed) 2)Remember when Bitcoin hard forked 8+ times and many of those forks suffered 51% attacks due to lack of interest? If decentralization were good, then why does everyone centralize on the original chain? > The entire Internet is built on various levels/degrees of decentralization, and while there are performance costs, it's still usually cheaper than the alternative in the long term. Explain to me how many machines running at under 100% capacity is cheaper. Why does the cloud exist if that’s the case?

rwmj 4y ago

Couldn't that be more efficiently solved using a public database maintained by a trusted third party? We don't need a blockchain to know who owns shares for example.

floober 4y ago
Efficiently? Maybe. Providing the same type trust and guarantees? Probably not. A public, append-only Merkle tree just has a lot of interesting properties and I think there are spaces where they are useful.
grp000 4y ago
I'm just an engineer with no background in finance, but didn't a fair part of the 2008 collapse come about by trusted third party risk auditing that went bad? Rather than maintaining a centrality of trust at some level, it seems intuitive that if there is a public database with trust decentralized among all the participants, there is less of a chance for that trust to be abused.
- blowski 4y ago
  Financial transparency and integrity is a wonderful goal. However, I am yet to understand why any kind of blockchain is necessary or sufficient, or even a good solution. If you want to cook the books you can do it with or without blockchain. Same if you want to be honest. Blockchain seems like a very complex and expensive way of persisting transactions in a database.
  - coffeebeqn 4y ago
    It’s just a fundamental naïveté about how the world works. If I’m dodging taxes or hiding profits then I’ll just enter false numbers on the blockchain. Now what good is the blockchain? Unless the whole world runs on the super inefficient blockchain system then there is always a potential for gigantic drift between the actual state of the world and the blockchain.
- SideburnsOfDoom 4y ago

strangattractor 4y ago

I would agree. The whole currency thing is a sham. It has enabled some horrendous criminal financial activity. But when I think of state and local gov't making there ledgers public and preserving some anonymity of the payees. I see some really exciting prospects for transparency.

strangattractor 4y ago
https://www.theregister.com/2022/12/20/crypto_ponzi_scheme_cofounder_pleads/ https://www.theregister.com/2022/12/20/crypto_ponzi_scheme_c... https://www.justice.gov/usao-sdny/pr/us-attorney-announces-historic-336-billion-cryptocurrency-seizure-and-conviction https://www.justice.gov/usao-sdny/pr/us-attorney-announces-h... https://www.justice.gov/opa/pr/two-estonian-citizens-arrested-575-million-cryptocurrency-fraud-and-money-laundering-scheme https://www.justice.gov/opa/pr/two-estonian-citizens-arreste... https://mashable.com/article/biggest-crypto-scams-2022 https://mashable.com/article/biggest-crypto-scams-2022 Please post some links where Crypto is beneficial to anyone other than those that speculate in it.

formercoder 4y ago

Why can't we just have a better, trusted, third party? Any use case for Blockchain that does not use the phrase "zero trust" is not a real use case.

acover 4y ago
The merkel tree can be separated from the block creation. See aws qldb. https://aws.amazon.com/qldb/ https://aws.amazon.com/qldb/
digitaltrees 4y ago
Because separation of the record from the record keeper means the system will be endowed with new attributes such as accuracy, verification. distribution, longevity etc that result in a more robust and valuable system. Imagine you run a fast food franchise with 10 restaurants, each keeping their inventories in a local database, how do you coordinate global restocking? Manual reconciliation across each database. Ok move to the cloud. Now you have a global picture where state is adjusting in closer to real time and reconciliation is an inherent property of they system rather than a process implementation operationally. Well as I have described elsewhere in this thread. A lot of financial transactions are managed in an equivalent process of local databases with manual reconciliation. I am oversimplifying because there are a number of road blocks that prevent a solution like “implementing a cloud database” and also conflating what happens within a company (using the franchise analogy) rather than a market (where every single franchise had a common inventory and ordering system not tied to a third party supplier). By my point is that a block chain ledger would solve many of these problems without users even being fully aware of the problem in the first place.
- peter422 4y ago
  There is no reason you can't mix the cryptological security of the Bitcoin Blockchain without the proof of work part. If I (a trusted third party) maintained a giant public database that anybody could append to, it would be trivial to release checksums or hash values at specific intervals to prove that nothing in the past was altered.

comte7092 4y ago

>Which means that the property ownership is literally a spreadsheet (often with a date in the file name) Are you implying that the spreadsheet is/was itself a legal document signifying ownership? Because that is radically different for my understanding of home ownership. I have never owned property, but to my knowledge ownership is conferred by way of a deed that is registered with the government. Which leads to the main issue with the crypto hype that I see. The majority of the space is taken up by two overlapping camps: get rich quick shills and techno libertarians who believe we’d have utopia if not for the pesky government.

TheOtherHobbes 4y ago
If there's a mortgage the deed is held by the mortgagee. Or at the very least there will be a formal legal claim on the deed (in the UK it's called a lien or a charge - not quite identical but similar) which isn't satisfied until the mortgage is paid off. Worse, there were instances in 2008 of banks stealing homes out from under people - who sometimes didn't even have a mortgage - by getting fake paperwork waved through, because it was impractical for all the competing claims on a loan to be properly validated. https://www.salon.com/2013/08/12/your_mortgage_documents_are_fake/ https://www.salon.com/2013/08/12/your_mortgage_documents_are... Would blockchain fix this? No. The problem wasn't tracking the transactions, it was the fact that banks and the financial industry fraudulently hid the true risk of various loan bundles. Blockchain would only have solved this problem if the loan context - creditworthiness, payment history, and so on - was included with every loan transaction, and could easily be accessed and summarised for all the transactions in all of the loan bundles. Which blockchain doesn't do. Coincidentally, this is exactly the same problem that blockchain hasn't solved for FTX, Binance, Mt Gox, etc. Blockchain does not provide an objective assessment of risk, value, or corporate credibility. It's just a ledger. Even if you can't manipulate the ledger, you can still manipulate the perceived meaning of the numbers in the ledger. Especially if you're a trusted party in the cryptoverse. In fact it doesn't just fail to fix these problems, it creates new opportunities for spectacular frauds.
- digitaltrees 4y ago
  Actually yes the problem was tracking the transactions. There were literally competing spreadsheets that teams of lawyers had to argue about and reconcile by looking at emails between traders and comparing row by row. Have you ever tried to compare two spreadsheets? Lawyers know how to blackline two word docs. They don’t know how to compare two datasets programmatically. It’s part of the reason I started coding. I felt after charging $850hr to manually compare row level data across spreadsheets. In fact counts eventually started getting harder on banks, rejecting the argument that tracking transactions was impractical and ruling in favor of homeowners and making the banks eat the loss for their own shoddy paperwork. But for many it was too late.

hyperman1 4y ago

I see 2 core parts to cryptocoins: The Merkle tree for honesty and the Proof of work for value. I'd agree the Merkle tree is good as the ledger. AFAIK it is also used in certificate transparancy logs: Every block of log entries contains a cryptographic hash to a previous block, so you can't rewrite log entries, only append them. This is what guarantees honesty in the certificate world, and is I assume the only aspect you need for your proposal. But the Proof of work is basically a race to do as much computation as possible. This is the part that wastes so much energy and resources, the part that slows things down, but also the part that provides value to cryptocoins by proving that someone wanted to waste/spend the resources. Do you see value in a system that has both aspects?

er4hn 4y ago
I'll chime in here that Merkle trees are best used to tell you if something changed in the historical records. Certificate Transparency (CT) provides you with an easy to verify way to generate a single identifier that tells you the current state of a set of information. You can then incrementally add onto it while checking that none of the past information was changed during that addition. This is a pretty similar concept (and motivation) to Git. Where this becomes interesting is that someone can just change the past data, then go through and update all the subsequent additions to come up with a the new final value. CT handles this by having multiple other entities check that the CT root values are not changing over time. Git handles this by allowing for similar mechanisms - if you believe Linus he memorizes the root hash of his local repo before bed each night. A post-it note would work just about as well for the Linus/Git case, but I am getting off topic. I don't see value in proof of work because it assumes that any system would have more entities (where each entity has some amount of computing power..) watching than there is computing power attempting to rewrite it. That doesn't really scale up across most industries use cases. A set of say, mortgage companies, could just exchange data in a merkle tree format and raise an alarm if it looks like the values changed from the prior root. This is very fast and cheap to compute and doesn't require proof of work calculations.
cma 4y ago
Proof of work is to prevent double spend, not provide value in some other way--it wastes lots.

markwkw 4y ago

Home deeds, loans, mortgages are not accounting concepts, but more in the ... contract(?) land. When a loan is made, a loan document exists; and accounting entries exist somewhat separately. A contract can be entered without writing, a contract can result in complex accounting treatment which may be investigated, rules clarified, decided, corrected when methodology errors were made. Do you mean that the blockchain is supposed to help with the accounting side, or with the contract side, or both?

ElevenLathe 4y ago
I think the dream is something like making a single commit that updates your code and the documentation that is kept alongside it in the same repo. A blockchain transaction would represent the entire transaction including the mortgage agreement, the deed, the asset on the lender's books, and the liability on the borrower's books. I say dream because there's no real path to this ever happening, and it's definitely not happened yet.
digitaltrees 4y ago
These are separate things. The legal contract is separate from the legal document establishing ownership, separate from the government ledger which tracks the chain of ownership conveyed, separate from documents related to the performance of the contract such as installment payments, principal and interest balances, and lifting of the encumbrances such as liens. There are different systems and procedures for each. Some are fine. Some could benefit from a central ledger. Whether that’s a database or crypto I don’t really care. Just throwing the idea out there.

uberdru 4y ago

Ironically, perhaps not so much so, that's precisely why the blockchain was invented in 1992. A simple notary service.

jerrygenser 4y ago

Could these ledger be a log data structure in a single database that is run by a trusted entity like a government? Why does it need to be decentralized?

mudrockbestgirl 4y ago
What you want is full transparency and incentive alignment. A government, or rather the people running the government, fundamentally don't benefit from these things because they use monetary policy to benefit themselves and the elite that is currently in control. Of course they need to get re-elected, so they must make it so that the general population believes in their "goodness" - The fed is just a group a people making decisions behind close doors with who-knows-what political incentives. So yes, in theory it could be a centralized database but I don't think there exists this mystical "global trusted entity" that has the population's best interests as their main incentive because everything within a single nation state is clouded by politics. Banks and big tech are prime examples. That's why it needs to be decentralized, decoupled from specific governments and people in power.