Everybody talks about blockchain, the platform technology for codecs like Bitcoin, that will change every once in a while. However, after years of tireless effort and billions of dollars of investment, nothing really stands out from the blockchain application - except for speculative currency and illegal transactions.
The different uses of blockchain - from payment to legal documents, from contracting to voting systems - ultimately revolve around adding data to a scattered, encrypted ledger, or Anonymous, something that no one needs. Is not there a real application for scattered ledger? Had it not been 10 years since its invention, the reason for not accepting scattered books at a reasonable scale was because no one wanted it?
Payment and bank
The original idea of blockchain was to give the pre-coding as Bitcoin a way to store and exchange values like other currencies. Now people will have a way to exchange instant value, free of charge and without intermediaries, and not rely on a government-controlled monetary system. A revolution in banking and currency.
But very soon after, the dream broke. In fact, there was a way to exchange instant values, free of charge and without intermediaries: cash. Meanwhile, payment services such as Visa or MasterCard, though costly, are accompanied by a series of value-added services such as helping banks track down fraudsters and identify buyers and sellers.
Not only that, this is not a good payment system. While Visa can handle 60,000 transactions per second, Bitcoin's historic high is only 7 transactions per second. Although there are many technical modifications to improve the efficiency of Bitcoin, it is not enough. In addition, the speed of seven Bitcoins per second is 35 times more energy than Visa. If you push Bitcoin volume up to Visa, it consumes as much energy as the rest of the world combined.
Transactional freedom without government supervision
In the minds of so many people, the ability to hide something from government scrutiny can make the world a better place. But there are still two important reasons why this is not quite as great as it might seem: the benefits of government to the individual and the interests of government to society.Government-backed banks may offer deposit insurance, reverse automatic clearing (ACH), identification, issuance of audit standards, and investigate when mistakes occur. Meanwhile, according to Bitcoin's design, it can not get these things.
Stories about users losing their Bitcoin numbers when email is hacked and stolen passwords are rife on the news. Not only that, in 2014, when Bitcoin traded at that time, Mt. Gox loses $ 400 million in investor money due to security holes, no one has recovered until recently. The same is true of Bitfinex.
In addition, government policies are designed to disrupt terrorist financing and organized crime activities, preventing the path of illegal goods. The primary priority of this is to ensure the privacy of the transaction but can still be found if a court order is issued. Bitcoin's freedom will be less exciting if 100% of its bandwidth is used for illegal goods or services.
Micropayment and bank transfer
These are two paid apps that make people especially excited about the blockchain-based coding currency. It is expected that, with blockchain, Bitcoin transactions will be free and immediate. So many people recommend using it in small payments, for example, 2 cents for a song they hear on the internet or 4 cents to read an article.
In fact, each Bitcoin transaction takes about 8 minutes to complete and costs 4 cents to process. And instead of these small payments, content providers offer paid subscriptions, and users do not have to wait up to eight minutes to read the article they want. They just click, and the content they request will appear.
As for interbank money transfer, the name Ripple is often referred to as a promising name. However, after three years of presence in banks accounting for 90% of the world's foreign exchange, in the last 30 days of 2017, the ripple network handled just $ 2 billion - Interbank SWIFT current network.
Why are banks not so keen on this new technology? The answer lies in the fact that the payment gateway Ripple Gateway is actually not much different than the current reciprocal account system - except that the loss of a password or security token will cause far greater damage. In addition, banks have ledgers, and do not need to scatter them, anonymize, encrypt, publish them, and make them irreversible to operate efficiently.
Smart contract
Smart contracts are contracts written in software, instead of legal language. Since you can encode them directly on the blockchain, they can pass values based on the coding consensus of the parties involved. Theoretically, software contracts are cheaper to interpret - because their operations are purely mathematical and automated. This also means that expensive legal battles will no longer be needed.
Investors and startups in the smart deal promise that blockchain will allow execution and payment to be super-fast. For example, in purchasing health insurance, "rather than waiting for 90-180 days to process the request, or waiting for hours on the phone to pay bills, theoretically it can be done only in blink."
However, this is also true for any software-based purchasing system. For example, the expansion of the Amazon cloud server power can take place automatically based on the amount of traffic to the website and the cost of what the buyer uses.
The idea that smart contracts can change this is a misconception - they think they can use it to enforce a legal contract while the legal contract itself is programmed as software. .
Amazon's terms of service are not smart contracts, but their payment systems enforce such terms as smart contracts. The same is true for health insurance payments. Perhaps the idea of a smart contract to automate the implementation is interesting but it's like reinventing the wheel so everything is already there.
