RE: Could we be wrong about cryptocurrency? Blockchain without a currency!
I really don't like the term "private blockchain."
To me, it's synonymous with "private database."
The core fundamentals of what makes a blockchain a blockchain involve teokenomics and game theory based on a financial value (or perceived future financial value) of the token that secures it. When people claim they can have a secure blockchain without a valuable token to secure it, I have to think they don't fully understand blockchain technology yet and may benefit from reading the original white paper a few more times.
Without the open, dynamic, market-driven, byzantine-fault tolerant nature of the system, then it no longer qualifies as a blockchain. Distributed databases have been around for a long time and they provide value for their existence that exceeds their operational costs. That's nothing new. A blockchain without a cryptocurrency is easily attackable.
Is it possible other distributed ledger technologies might evolve in the future such as DAGs which could eliminate the idea of a token and just deal directly with some other source of "work"? Maybe... but to me, it would still serve the same service the token currently serves.
I agree with the statement that it could be seen as a distributed private database, but I disagree that it is no blockchain cause there is not cryptocurrency involved.
It could use from all the benefits of the consensus, timestamping, security, smart contracts and so on. I also don't understand why it could not use the byzantine-fault tolerance, there are no coins needed for that. If the tokenless blockchain does has 10 nodes, all of the above could be implemented. The rewards of being part of the blockchain should be high enough though to keep it running.
I have to admit that I did not read the bitcoin white paper (will do soon). The example above can hardly be compared with a decentralized database, in my opinion.
One of the biggest reason why the bitcoin use case is so great, cause it aims to eliminate middle men and double spending. This can of course only be guaranteed if the bitcoin is created and maintained by the blockchain. But I can better read the whitepaper first :)
Thx for your insight, really appreciated it. Although we are not completely on the same page :)
All the examples you list already exist in private, distributed databases (though “smart contracts” would be called table triggers in SQL). I say this as someone who has worked with databases for over two decades. Can you clarify exactly what you mean when you say “blockchain”? If you haven’t yet read the defining document for that term, maybe you have unexamined opinions?
While I do understand the basis of the blockchain, I did not read the BTC whitepaper until 5 minutes ago.
If we do compare the standard distributed database with the private blockchain, there are IMO completely something different. Almost all DDs (distributed datase) are based on replication or duplication, which both have their pros and cons. If in a duplication the master has been compromised, the slaves will also be compromised. If in the replication a hacker intrudes into one of the database, the fault record would/could be copied into the others.
In a private blockchain, the consensus mechanism is still in place (even in blockchain without a token). A new block is only approved if their is consensus in the complete blockchain. In the original whitepaper the first transaction in the new block, is the transaction which rewards the coin to the creator of the block, in a token less blockchain, this would not be necessary.
But to respond to your question:
A network of nodes, where information (important to the use case) is gathered and stored in block. Each block will have a hash based on the content of the block. The next block in the chain will refer to the previous block, creating the chain. New blocks are proposed to the network and will only be accepted if there is a consensus between the nodes in the network. When one of the older blocks is tampered with, it will not be accepted by the network cause the chain will be broken ( the hash will be changed). To succesfully attack the blockchain, the hackers must be capable of hacking enough nodes, and rewrite the complete block after the tampered block on all nodes, before one of the other nodes creates a new blocks. You can add to this the timing mechanism, the smart contracts, and so. By doing this there is no need for a third party to trust each other but the trust is based in the cryptography of the blockchain.
This is short what I would call a blockchain.
In my opinion each of this could be perfectly feasible with or without a native crypto currency. And not all of the above could be done on a distributed database.
If I do have some things wrong, please do not hesitate to correct me. I can only learn from it.
The mechanisms you mention regarding consensus are what distinguish a private database from a blockchain because a private database obtains consensus via controlling the nodes where a blockchain is uncontrolled and wide open to attack. It's that open nature, to me, that separates a blockchain from a database. The only thing protecting it is the incentive provided to the block producers to be rational actors in the best interests of themselves and the network. That incentive only comes through the distribution of a valuable token. I have yet to see any other mechanism for providing that incentive. I have seen blockchains with tokens of little value be 51% attacked. If the token is not valued enough, not enough miners will mine the blockchain to reach useful, secure consensus which means it will fail. I say "mining" here but similar economic incentives exist for DPOS as well.