Research Examines Compatibility of Public and Private Blockchains
While distributed ledger technology continues to gain momentum among the world's financial institutions, the potential and viability of bitcoin is still being largely dismissed by the same parties. Avid bitcoin supporters believe that using a private blockchain would inevitably result in a centralised system - a world away from bitcoin's decentralised, trustless protocol. However, according to bitcoin mining firm BitFury's latest white paper - written in collaboration with developer Jeff Garzik - permissioned and permissionless blockchains are compatible and can be interconnected. Many....
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Investor Fred Wilson, co-founder of Union Square Ventures, thinks banks are missing the most important opportunity bitcoin offers by building private blockchains. Speaking on a panel with Nathaniel Popper of The New York Times at the CB Insight “Future of Fintech,” he said the transformative value of virtual currency will be on a public blockchain, as reported by the Observer. Private blockchains copy the distributed approach of public blockchains but hide it inside the servers that their creators have given permission to maintain a copy. Private Blockchains? Think Compuserve. Wilson, a....
A few months ago I was writing a research paper centered on this question: Is there a use case for private blockchains? I'll be honest, I started writing it with my conclusions already on mind. I was totally biased. My thoughts were basically that private blockchains (and the lack of PoW) couldn't offer more security than a distributed database. And at the same time they were pretty limited and based on a much more immature technology. So, why on earth a bank or any organization would use a private blockchain instead of a well known and proven technology? Simple answer: fad. Nevertheless,....
Vitalik Buterin is a programmer and writer. He founded Ethereum, a decentralized web 3.0 publishing platform, for which he won the World Technology Award in 2014. In this article, he explores the differences between public and private blockchains and the pros and cons of both. Over the last year, the concept of 'private blockchains' has become very popular in the broader blockchain technology discussion. Essentially, instead of having a fully public and uncontrolled network and state machine secured by cryptoeconomics (eg proof-of-work, proof-of-stake), it is also possible to create a....
Many people argue that private blockchains, run by private firms, are useless, since they make users dependent upon a third party ‒ the firm managing the blockchain. Many believe that private blockchains currently being considered are not blockchains, but rather, distributed ledger technology which has already existed. Others believe private blockchains could provide solutions to many financial enterprise problems that Bitcoin does not, such as abiding by regulations such as the Health Insurance Portability and Accountability Act (HIPAA), anti-money laundering (AML) and know-your-customer....
Blockchain technology is rapidly transforming the world and the web as we know it. Since the technology was first unveiled, there has been a substantial increase in the use of both public and private blockchains across an array of industries. In fact, government organizations, too, are starting to adopt blockchain for better security, traceability, and […]