Wall Street rethinks blockchain projects as euphoria meets reality

Great piece of news indeed... In my opinion blockchain needs careful review before serious money might flow in or we're risking another 2008!
 
Blockchain technology probably has its uses alright, but given the scaling issues and rampant energy use with Bitcoin, perhaps the technology is better suited to low volume / high value transactions?
 
Firefly said:
but given the scaling issues and rampant energy use with Bitcoin
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Those issues are solely related to the bitcoin implementation, particularly power usage which is completely artificial and a function of how many people are throwing massive computing power at mining just to chase the potential of receiving block rewards. Fulfilling the basic function of confirming transactions would only actually require a tiny, tiny fraction of the power.
 
TheBigShort said:
Who or how, would that be achieved without ceeding control to a centralised authority?
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Why such a need? Just change the game rules to correlate mining rewards to transaction volumes & fees. Go back two years and the power consumption related to bitcoin mining was a small percentage of what it is today, transaction volumes were slightly higher.
 
Admittedly im on the "Dummies Guide to Bitcoin..." when it comes to understanding the tech.
That understanding works something like this;
In the beginning, mining bitcoin was very simple, your own pc at home could chug away obtaining new bitcoins at ease. In order to transact, the double-spend problem needed to be resolved, requiring 'nodes' to verify. Those nodes are rewarded for their efforts through acquiring bitcoin mining.
As more nodes start to mine, bitcoin becomes more complicated, more competitive, raising the price. This in turn increases energy usage.
If energy use costs rise above market price, miners will leave the market, making it less competitive and price will fall. As miners leave, energy use falls, attracting miners back into market etc.
If energy use costs can be diminished the greater incentive to mine some more.

Im sure this isnt 100%, but I dont think its off the charts either?
 
Leo said:
Fulfilling the basic function of confirming transactions would only actually require a tiny, tiny fraction of the power.
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And then just a 'tiny fraction of the power' on invalidate it all and ruin the system.
 
Leo said:
Those issues are solely related to the bitcoin implementation, particularly power usage which is completely artificial and a function of how many people are throwing massive computing power at mining just to chase the potential of receiving block rewards. Fulfilling the basic function of confirming transactions would only actually require a tiny, tiny fraction of the power.
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That's the way I read it. But ant dee claims that the bulk of this CPU power is in fact needed to maintain the integrity of the blockchain. Well then why was it not needed two years ago.
 
TheBigShort said:
As more nodes start to mine, bitcoin becomes more complicated, more competitive, raising the price. This in turn increases energy usage.
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What's really happening is that as more people bring miners online, the more complex the hashing becomes purely to slow down the rate of discovery of new blocks so that remains fixed at 10 minutes. The additional complexity of the algorithm is a function of the number of miners, and has no correlation to transaction volumes.

The risk of bad actors invalidating the blockchain isn't a compelling case from my understanding. It was tried back in 2010 and addressed at the time, and nodes attempting this now may be blacklisted. At worst now they could prevent some transactions being processed, double count them or prevent other nodes from mining. You don't need to be in charge of >50% of the computing power to have some success with those attacks as it stands.
 
Ok, im not doubting that what you say is correct, but as implied earlier...whoosh!...alot of that goes over my head.

But what im gathering from your post is that inherent in the whole bitcoin concept lies a fundamental flaw in its viability?
If this is true, I would have no hesitation bailing out my last bit of bitcoin and jumping the fence to join Brendan, Duke and others.
But as it stands, I suspect this issue is not exclusive to the pages of AAM and therefore is probably dealt with elsewhere? Or in other words, it would appear to be an issue than is so transparent (to those who understand the tech) that bitcoin being alive for 10yrs now makes no sense.
So on that basis, I accept what you say, and my overall bitcoin confidence index has taken (another) hit, but insufficient to bail out altogether!
 
It seems to me it is the astronomical price of bitcoin that is exacerbating the energy usage. Whenever all bitcoin have been issued the price will be irrelevant and the only fees will be transaction fees and CPU power and energy usage should drastically reduce.
 
TheBigShort said:
it would appear to be an issue than is so transparent (to those who understand the tech) that bitcoin being alive for 10yrs now makes no sense.
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"Being alive" is not necessarily nonsensical, but being priced at $6,700 is.

I don't understand this issue either, but I gather that when Bitcoin falls drastically, the costs will reduce drastically.

But it's another reason for asking what is so special about Bitcoin? Other coins may well have avoided these problems or may just be better technology overall.

Brendan
 
Brendan Burgess said:
Being alive" is not necessarily nonsensical, but being priced at $6,700 is.
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Why?

Brendan Burgess said:
But it's another reason for asking what is so special about Bitcoin
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The concept of owning and storing your own money outside of the monetary system is its greatest appeal to me.
I could buy a bar of gold but it would be cumbersome and costly to store and manage.
I could buy art, or antiques, but realistically im not in that game. My art collection consists of some 500-600 LP's, 12" and CD's that are, barr some small exceptions, mass produced.
I could buy property, but I would have to take on another mortgage, and im done with that game.
Bitcoin on the otherhand, offers an opportunity to store and transfer my money outside of the monetary system, should I wish to do so. I think it is prudent to do so although I do think at this juncture, only that what you are prepared given its volatility.
I currently have remaining a stake of €600, and despite recent falls, still has a 30% profit if I cashed out now.

Brendan Burgess said:
Other coins may well have avoided these problems or may just be better technology overall.
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If other coins provide the same option, with less costs, with better technology, its inevitable it will replace bitcoin.
 
TheBigShort said:
If other coins provide the same option, with less costs, with better technology, its inevitable it will replace bitcoin.
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IOTA have no fees to transact and is infinitely scalable. At the moment transactions take around 3-4 mins to complete but this will get much faster as the network grows.

With regards to replacing Bitcoin.....we call it the 'flippeening' but it might take years before it happens! It could a number of other coins that do it though but I'm banking on IOTA doing it first! :)
 
Negotiator said:
IOTA have no fees to transact and is infinitely scalable. At the moment transactions take around 3-4 mins to complete but this will get much faster as the network grows.

With regards to replacing Bitcoin.....we call it the 'flippeening' but it might take years before it happens! It could a number of other coins that do it though but I'm banking on IOTA doing it first! :)
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Its one to look into so.
 
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