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So much for Blockchain's real life use cases (lemmy.ml)

submitted 1 month ago by [email protected] to c/[email protected]

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[–] [email protected] 24 points 1 month ago (14 children)

A banking system running on Blockchain

Is an astronomically terrible idea. It:

would use as much electricity as an entire country
payments/transfers would be both much slower AND much more expensive than via a bank
would have no protection against fraud. You got scammed? Your money's gone. You paid for something online and it never arrived? Too bad
would have no way to stop money laundering
would have no way to help people who forgot their password, they'd just lose their life savings permanently
would tie up a bunch of capital, preventing reinvestment and growth. There would be no way to get a bank loan to buy a house for example
the list goes on

[–] RedDoozer -3 points 1 month ago (7 children)

All your points are about an obsolete idea of Bitcoin, a PoW public blockchain. A PoS private blockchain with private keys not handled by the users would invalidate your entire list.

[–] [email protected] 5 points 1 month ago (2 children)

You mean PoS, which feature is literally that the more you have, the more you can stake, and the more you can earn in return? So basically the system that has built-in wealth concentration?

[–] RedDoozer 1 points 1 month ago (1 children)

Yes, but if we are talking about a private permissioned blockchain, there's no need to obtain returns from staking. It can be even a Proof of Authority tokenless network for what banking care.

Banks are already paying for servers to process and store information. A few validators or collators (quite cheap for a private network) provided by several banks would cost a fraction of what they pay now and they'll keep owning the data, they could reverse transactions, be covered by several layers of public encryption, guard the user's wallet/login, etc.

Don't mix blockchain with the speculative world built on top of it. That's only an unfortunate use of the technology.

[–] [email protected] 1 points 1 month ago

Banks are already paying for servers to process and store information.

Yes

A few validators or collators (quite cheap for a private network) provided by several banks would cost a fraction of what they pay now

How? They'd be doing extra compute work for no reason (validating already valid transactions), and storing extra data (lots of hashes) for no reason, so it can only make infra costs more expensive. Plus the added complexity meaning you have to hire an extra team just to understand it.

Don't mix blockchain with the speculative world built on top of it. That's only an unfortunate use of the technology.

That speculative world as shitty as it is, is the only proven use case of the technology, if you take that away then blockchains are even less useful

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