Companies really need the blockchain, but it hardly replaces the centralization

News Agency Bloomberg quoted a recent report from CB Insights, which refers to the decline in the blockchainstartups in 2019 by 60 percent to 1.6 billion dollars. But at the same time large companies, including Microsoft, Walmart, IBM and Samsung, have implemented either their own baccani, or has entered into a partnership to use technology. Ironically, a number of banks, which the blockchain in the ideal was to oust has also developed its own blackany. What happened? Why public blackany with the true spirit of decentralization out of the game, while former opponents became supporters of the technology?

A belated adoption of the blockchain

The government and politicians are often accused of not understanding the blockchain. Many of them initially ignored cryptobium that led to the hype around primary offerings of coins (ICO) in 2017. Then they began to resist, regulate and close the blockchain projects that harm to a developing industry. But over time, they gradually began to adopt this technology.

Notable example is China, which initially forbade such a blockchain projects. But at the end of October 2019, the Chinese President XI Jinping launched the course, demanding that China took “more effort” in the direction of blockchain developments to get “an edge over the other leading countries”. Although the ban on the cryptocurrency has not been cleared, it showed the changing attitudes in favor of new technology.

Read on: What will happen if China will start to dominate in the field of digital currencies?

Public and private blackany

It is worth noting, companies have their own version of the block chain: “private”, or “corporate”. They have a number of differences from traditional “public” of the block chain.

Source: 2Биткоина

In contrast to the public block chain by type of Bitcoin or Ethereum, the private blockchain can join not all. Each node (node) individually, selected by the company, which in some cases may require authentication. For the same reason “trust” is much easier. Because the nodes have been identified, the risk that attackers will try to exploit the blockchain, is much lower. And if they do, then they will not be able to remain anonymous.

This brings up the question of scalability. Since nodes are less involved and can be used other mechanisms of consensus, transactions are much faster. Hyperledger supports up to 20 thousand transactions per second, whereas Ethereum is only 15.

In private blockchains there is no need of “rewards”. Normal blockchain projects have to pay nodes for their work and consume energy. In private blockchain it makes no sense, as the project is stimulated by other methods. For this reason, private blackany easier to update and upgrade. Public blackany requires the consensus of the majority of the participating nodes and disagreements can cause division, when a new blockchain. In the corporate blockchains such requirements do not exist, which means that the code can be updated much easier and faster.

Source: Unsplash

For these reasons, start private blockchain much easier. That’s what this bill said technical Director Nem Foundation Nate D’amico. His company supplies both public and private decisions blockchain solutions.

In the short term, more projects are likely to use private blackany to get comfortable with the process start, only later on moving to the public blackany.

However, the public blackany preferable for several reasons: in particular when you need to connect to each other people do not have information about each other, but willing to interact and conduct transactions. That is why there was Bitcoin to peer-to-peer transactions without intermediaries. Which begs the question: do we even need corporate blackany? If we neglect the chief characteristic of the blockchain, why not just use a distributed database?

Useful to read: what is the difference between Baccano and database?

Real application of the blockchain

It turns out that the use of the technology of the blockchain companies has its advantages. These include commercial considerations. The company strictly control the nodes joining the network, but this does not mean that they dictate how the system operates.

Source: Reddit

When multiple competitors need to cooperate, blockchain provides a perfect environment to interact without having to trust, where neither party has too much power. Sometimes it can even go on political considerations, for example, when no Central storage of the database does not suit all parties. Decentralization also prevents any of the parties requested too big fee for their mediation services.

Finally, there are also security concerns. The blockchain has a built-in data duplication, encryption, synchronization, and resistance to interference.

The fundamental difference between the architecture of the blockchain that openness, collaboration and data-sharing between different parties makes the database more secure and reliable. Thus, the blockchain offers one of the best methods of data storage.

But there are also certain disadvantages. As noted by D’amico, “a gray area for making both private and public registries/of the block chain is to regulate the type of GDPR as well as storage organizations personal information and other related data in the blockchain.

Depending on the type of network — for example, if the global network — you have no control over the location of data copies and can’t use the “right to oblivion” because the data is inherently immutable and cannot be deleted from history.

Source: 2Биткоина

Contrary to popular belief, do not expect that the blockchain will replace centralized institutions. Rather, the trends indicate that the highest probability of survival will have polycentrality regulated by the governments of the versions. Startups learn from their own experience that they need to comply with the requirements of government regulators – not because they obey a higher power, but simply due to the public interest. In the end, the blockchain requires trust code and algorithms instead of people, and not everyone is ready to trust them. In simple cases, the confidence code and algorithms can work perfectly, but in borderline cases requires resolution of disputes in human bodies.

However, the ability of the blockchain to provide immutable and protected from interference by the registry may help to prevent the abuse of power. As in the case of most other technologies in the application of the blockchain is best to find a balance between human and computer.

In our cryptodata of hontarov you can discuss the pros and cons of the introduction of the blockchain and its possible consequences.

Subscribe to our channel in the Telegram. Mass adoption is around the corner!

Leave a Reply

Your email address will not be published. Required fields are marked *