Private Blockchain - An Oxymoron?
We usually get puzzled and confused looks from newcomers to the cryptosphere when we talk about a centralized party looking into "Blockchain Technology", or a consortium of banks trying to find best solutions to stay in the game or governments trying to "BAN" cryptocurrencies to save themselves from the wrath. Assuming most newcomers have bitcoin as their gateway cryptocurrency, they read and listen to a lot of fancy and disruptive words like "decentralized", "open-source", "trustless", etc. Any person (including us) are swayed away easily by these as many hopes and dreams and alternate realities play out in our minds and suddenly the future seems so exhilarating.
As they dive deeper, they end up discovering lots of other inside designs; smart contracts, ICOs, dApps, DAOs. The list increases every day with continuous advancements. Soon enough, sides are chosen, some are blown away by Vitalik's incredible vision, some find escape in the disruptive technology of Ripple, some become diehard supporters of Tron or EOS or Stellar due to early emotional attachments. But one thing is common among all, they all are excited to see a future where they have a direct say in how they want the space to develop. Any person can voice their opinion in the consensus-based community of most blockchain projects.
That's why most of them are absolutely clueless when asked about the future of 'Private Blockchains'. Somehow it feels contradictory. How can a private enterprise take control of something that is open-source, community-based and decentralized by definition? How can consortiums be formed to look into corporate solutions? How can governments try to take charge of the innovation?
Sure we don't have answers right now. But to find them, we sure need to ask the right questions.
- SB
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These are all wrong and stupid questions. Private blockchains are not anything new. They are around for years. One of most known platforms for building private blockchains is MultiChain.
Whatever is open-sourced and community driven, it can be closed-sourced and corporate ran. And a technology can be internally decentralized inside a company. For which reason Microsoft couldn't fork bitcoin and use it for their own internal purpose inside the company?
Also stupid question. Did you ever hear about Hyperledger? It's a umbrella project of open source blockchains and related tools. It is also around for years now. You know who's behind it? It's a consortium with big players like Intel, IBM and SAP. Some of Hyperledger technologies can be used for private blockchains.
Not all governments are corrupt and run by incompetent mediocres. For example, do you know how Norwegian government impacts big corporations to change their policies for greater good. By investing in shares of Apple, Microsoft, Tesla Motors and other tech companies Norway affects their polices and contributes to innovations.
You bring up some great points. Your explanations are on point. But I think you missed the essence of the post
We are simply highlighting the fact that people who hear of blockchain and DLT hear about it as a new revolutionary piece of tech that will help power finally exchange hands of the institutions to the individuals. This is the most widespread misconception.
If you look around the world, more and more companies are adopting DLT to improve their costs and efficiencies. They want to be the beneficiaries of this technology and pass on a small amount of the benefit to the end user. This is the case for any piece of tech.
Instead of ranting about how this and that are stupid questions and viewing everything from a pseudo elitist perspective, please understand these are questions we have witnessed (first-hand) newcomers stumble all over and get confused over.
Nevertheless, your feedback is greatly appreciated!
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There is nothing "pseudo elitistic" in stating simple facts. Other side of this story is that some people are not able to understand what blockchain is and what is difference between blockchain and cryptocurrency. That's why now we have our grandmas, aunts and local butchers trading bitcoins.
You wrote a post about years old topic. Yes you will still find some people not understand it and not able to comprehend this topic. But instead of stating these irrelevant question it would be more beneficial for all of us that you explained what private blockchain is and what are the use cases. And how decentralization can still exists in corporate and government environments.
Hi @reverseacid.
Found you through @crypto.piotr. Following you..
Anyways, great post. You make it even more interesting by putting questions towards the end..
Thanks
@questionthetrend
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Thank you! Your support is greatly appreciated
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Absolutely true, even here on steemit initially when I heard about the platform it looked like an easy way to earn a few bucks but I've been here for over a year and the community here is amazing and the future this platform holds in the cryptocurrency world is also really exciting. People like @crypto.piotr are the backbone of the community.
And did you earn a few bucks?
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that is so ridiculous- PRIVATE BLOCKCHAINS? I just do not know if this is going to be a reality someday but if it does become a reality, I am jumping ship back to where I started- fiat- because basically, they will be the same I think.
And, another question, how can a blockchain possibly become private? how can the ledgers and nodes "agree" in order to make a transaction if it is not accessible to the public?
I believe a lot of people out there share my outrage over this "idea" because if indeed, there is a private blockchain, then, its useless to mine, transact or even assign values to our alt coins. Who know? Perhaps someone already spent my coins in a transaction as per crypto whitepaper.
Dear @nurseanne84
I'm not sure how private blockchains would work and this is first time I'm hearing about them. But why would you ever consider moving back to fiat? Blockchain has still many advantages.
I've been also wondering about it.
Yours
Piotr
Now that there's a rumor about it- even vague references, we have to be "alert. "
It was the first time that I heard from @reverseacid and, I wanted to address that part because a blockchain, is a public "document." As far as I can understand.
Yes. If the cryptoworld will start doing private blockchains, I will get all my money and run! Because basically, its the same with fiat. At least with fiat, they have gold reserves..........
Don't worry as of now, its not like a near future plan. Its more of a distant possible option if the going gets really, really bad.
You are mixing up blockchain and cryptocurrencies.
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Please elaborate further on their difference.
Thanks.
Here is where you can find that answer http://bfy.tw/LvbL
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hey @crypto.piotr, check the link above!
There are multiple usecases for private blockchains:
Read more here: https://www.multichain.com/blog/2016/05/four-genuine-blockchain-use-cases/
Hi @nurseanne84, thanks for commenting and supporting our work.
First off, just to get it out of the way, with the underlying blockchain itself being a transformative power for data transfer, a private blockchain still works more efficiently than other private databases. Of course, control is centralized, but the point of these anyhow is not to create open systems but to supplement a closed system
A blockchain like Bitcoin is a public protocol. A blockchain run by IBM to track their supply chain is a private protocol. These private protocols need not have "nodes" in the traditional sense as they do not require consensus as such. The nodes in this case (IBM) will be their suppliers and other intermediaries. It's kind of like small scale consensus. There's no incentive to mine and their may or may not be a token that it runs on. It may simply be an immutable database for ease of maintaining corporate relations.
Hope this helped you in some way!
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Private blockcains is the same vision as private intranet in the old days!
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My sophomoric understanding was that private blockchains are basically just a means to keep a ledger or run numbers in a need to know only basis community.. Such as any private company that may wish to maintain internal transparency but not leak their financial transactions to competition or the general public. An accounting safety net if you will...
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In a simple word, a private blockchain is a private database with a consensus integrated that runs by a central entity or a company to benefit from this technology!
Absolutely. Essentially, just a way to keep control (centralized version) within an enterprise while leveraging the immutability and ease of data analysis of a blockchain
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private intranet ?
How did it even work? I've never hard about it till now.
Cheers, Piotr
A private intranet is the same as the internet but works inside in a private network. The same thing will happen with private and public blockchains.
Yours,
Chesatochi
And is that bad or good think in your opinion @chesatochi?
It seem that many do not like idea of private blockchains.
Yours
Piotr
I believe is a natural progression of this technology toward many industries out there. It will bring value for companies to save money toward many processes that rely on too many checkpoints.
The information will be easy to verified with private blockchain. I know is not the same philosophy of public blockchains like bitcoin or ethereum. :)
Yours,
Chesatochi
Thank you @chesatochi for your comment.
My pleasure.
I think WEKU is a private blockchain
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I don't know about this forked Steemit clone! :(
Dear @reverseacid
Interesting read buddy.
Good point. Asking right questions is what we must do :)
Cheers
Piotr
Indeed @crypto.piotr
We will never know the answer to the questions of tomorrow, but we can figure out what happens by analyzing the answers to yesterday's questions. Studying the evolution of each field from technology and science to language is how we attempt to prepare for the future.
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Love your comments big time @reverseacid :)
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STOPTo support your work, I also upvoted your post!
If it comes to the governments it is not that hard. They set rules/the law... if you want to buy or sell you need to be registered, ID, bankaccount and pay taxes...
If it comes to the rest time will tell.
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True, but government control is potentially necessary for private chains. For them it's the same process used today with better technology supporting it; for public protocols its new tech supporting a new system. It's very likely the govt tries to over regulate public protocols too, and that's where the real revolution will begin
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