Nasdaq makes first share trade using blockchain technology

mwpt

http://www.telegraph.co.uk/finance/markets/12075825/nasdaq-blockchain-share-trade-bitcoin-technology.html

Nasdaq said its Linq blockchain ledger had issued securities to an unnamed private investor, proving the concept of share trades through a decentralised ledger, and removing the need for a middleman such as a clearing house.

Not sure how many techies there are on this forum. This usage does seem like an obvious one for blockchain and probably one of the few I've seen that I could accept as truly useful.

I'm suspicious of bitcoin (not blockchain), because you have a currency that is essentially inflationary rather than deflationary. People hoard rather than spend bitcoins so all other nuances aside, this seems like a flawed currency to me.

Anyway, that aside, I don't know enough about blockchain to answer my own question: In order to validate transactions (transfer of ownership), some work must be done using processing power. This is necessarily difficult, to prevent a takeover of the network and hacking. In my opinion, for bitcoin, this is just a massive waste of energy and resources to build a speculative currency (just imo). Does anyone know if a similar level of resources would be required to validate and confirm the transfer of shares, as above? Would we see ever increasing processing power required to keep the network valid?

Jonbvn

There is a lot to be said for being able to send money to anyone in the world (who has a BTC wallet) for a few pennies almost instantaneously.

I agree that the main issue BTC has is the wasted energy required for proof of work, which is increasing. There are several altcoins, which are trying to address this. The one I like is GridCoin (GRC), which runs BOINC software to undertake scientific computing including medical research etc.

IMHO digital currencies are here to stay. However, what form they will take in the future is rather unpredictable.

cells

Jonbvn wrote: »

IMHO digital currencies are here to stay.

arent all currencies 'digital' now?

the advantage of bitcoin such as low transaction fees can also be adopted by normal currencies. In fact virtually all my transactions have a fee of zero which is a lot cheaper than 'pennies'. Businesses are charged quite a lot by banks for what the public gets for 'free' but there could be more competition to push that down or even regulations to force banks to charge nothing for transfers

the other advantage, of hiding your transactions, that is not a huge market maybe 1-3% of the economy.

Jonbvn

cells wrote: »

arent all currencies 'digital' now?

the advantage of bitcoin such as low transaction fees can also be adopted by normal currencies. In fact virtually all my transactions have a fee of zero which is a lot cheaper than 'pennies'. Businesses are charged quite a lot by banks for what the public gets for 'free' but there could be more competition to push that down or even regulations to force banks to charge nothing for transfers

the other advantage, of hiding your transactions, that is not a huge market maybe 1-3% of the economy.

Cells are you know, fiat currencies are far from digital, given that they derive their value from government decree. Digital currencies do not require any laws or decrees.

The UK is the only developed country in the world to offer free current accounts as standard. Consensus seems to be that this may end in the next few years. http://www.independent.co.uk/news/business/news/the-end-of-free-banking-will-come-in-the-next-five-years-10502295.html

Generali

Jonbvn wrote: »

Cells are you know, fiat currencies are far from digital, given that they derive their value from government decree. Digital currencies do not require any laws or decrees.

The UK is the only developed country in the world to offer free current accounts as standard. Consensus seems to be that this may end in the next few years. http://www.independent.co.uk/news/business/news/the-end-of-free-banking-will-come-in-the-next-five-years-10502295.html

LOL, of course digital currencies require laws. How would you feel if your digital wallet was stolen and you had no redress for example?

As for free banking, you don't have free banking as there's no such thing. What you have is banking paid for by other people.

I don't claim to understand blockchain in its entirety. I can say that I have heard of concerns that due to the permanent nature of the blockchain it is very hard to undo fraudulent activities.

Perhaps someone that knows more than I could comment.

cells

Jonbvn wrote: »

Cells are you know, fiat currencies are far from digital, given that they derive their value from government decree. Digital currencies do not require any laws or decrees.

The value of a digital currency is no more or less than the value of any other currency its just a medium of trade. The only possible advantage of a digital currency, assuming it is as I think it is, is that maybe it offers protection of confiscation from governments. But even that I think is quite weak, if someone really wants it from you pliers and a few pulled nails will do the trick

Jonbvn wrote: »

The UK is the only developed country in the world to offer free current accounts as standard. Consensus seems to be that this may end in the next few years. http://www.independent.co.uk/news/business/news/the-end-of-free-banking-will-come-in-the-next-five-years-10502295.html

Charging a small amount for an account is hardly going to break or make one or the other. For a digital currency you surely need the internet and that aint free is it?


maybe it has a future for the black market if nations go "cashless" other than that I dont think so. especially considering there could well be countless numbers of e-coins. Google coins facebook coins apple coins microsoft coins ebay coins amazon coins ....

mwpt

Two angles in this thread for me.

Primarily I'm intrigued if blockchain will always be limited in value by the excessive energy requirements in what will probably be a future where we have to start being conscious of energy use.

Secondly, the bitcoin angle. I agree that new fangled digital currencies are going to stick around but I just cannot get past the fact that bitcoin is for hoarding, not spending. I don't see how it can make a successful currency long term, particular with the energy requirements. Perhaps it will be the alternatives as jonbvn kindly pointed me to. Or perhaps I'm thinking about it incorrectly, after all, cash in a bank account can also increase in value (if interest rates were decent).

Perhaps I need to question

padington

mwpt wrote: »

Two angles in this thread for me.

Primarily I'm intrigued if blockchain will always be limited in value by the excessive energy requirements in what will probably be a future where we have to start being conscious of energy use.

Secondly, the bitcoin angle. I agree that new fangled digital currencies are going to stick around but I just cannot get past the fact that bitcoin is for hoarding, not spending. I don't see how it can make a successful currency long term, particular with the energy requirements. Perhaps it will be the alternatives as jonbvn kindly pointed me to. Or perhaps I'm thinking about it incorrectly, after all, cash in a bank account can also increase in value (if interest rates were decent).

Perhaps I need to question

You can create a deflationary digital coin. Doge coin has been around for ages for example.

Regarding defending a digital currency, you often need a massive ammount of power to defend any currency. British sterling is defended by a large police force, the best printing technology money can buy, a large Spy network and a crack team of geeks not to forget global treaties in place with other nations.

Any currency will always require a large amount of energy to defend it.

A currency is a store of energy and people will always want to steal that energy so a percentage of that energy will always need to be spent defending the rest of it.

I Imagine bit coin has had almost every state actor trying to crack it at one point or other and they can't. The black chain technology is genius and I suspect will underpin almost every transaction we do before not too long.

The only question is who can make a bank account equally secure and widely accepted to use it as easily as digital currency 1.0

TheeMaskedTurnip

I'm a techie and I know a lot about Bitcoin after mining some in the old days when it was possible with a gpu. It's an amazing technology and one I can see staying with us. I'd advise anyone and everyone to read up and learn more about the technology for a better thorough understanding of its full potential. The OP is incorrect to criticise it.

mwpt

TheeMaskedTurnip wrote: »

I'm a techie and I know a lot about Bitcoin after mining some in the old days when it was possible with a gpu. It's an amazing technology and one I can see staying with us. I'd advise anyone and everyone to read up and learn more about the technology for a better thorough understanding of its full potential. The OP is incorrect to criticise it.

Where did I criticise it (the technology)? Your post is bland and contains no information.

mwpt

padington wrote: »

You can create a deflationary digital coin. Doge coin has been around for ages for example.

Regarding defending a digital currency, you often need a massive ammount of power to defend any currency. British sterling is defended by a large police force, the best printing technology money can buy, a large Spy network and a crack team of geeks not to forget global treaties in place with other nations.

Any currency will always require a large amount of energy to defend it.

A currency is a store of energy and people will always want to steal that energy so a percentage of that energy will always need to be spent defending the rest of it.

I Imagine bit coin has had almost every state actor trying to crack it at one point or other and they can't. The black chain technology is genius and I suspect will underpin almost every transaction we do before not too long.

The only question is who can make a bank account equally secure and widely accepted to use it as easily as digital currency 1.0

Thanks. Good points about the energy that is currently expended to protect any fiat currency. For the record, I did not criticise blockchain. I am deeply suspicious of bitcoin though.

The blockchain technology is indeed very smart. I was merely questioning the energy requirements in order to keep the network valid, as opposed to other methods of digital transfers.

The space isn't mature yet, so we may see the technology morph before it becomes widely adopted.