Topic: "European Central Bank: Still Too early for Blockchain Technology" (Read 1176 times)

Trying to use a private blockchain is like trying to use intranet.

it just doesn't offer much value at all over old systems. 

the power of blockchain (and the internet) is the accessibility. If you try to close it down, it loses its purpose.

Could you explain in simple words what advantage it gives them?

As I understand this banks don't make payments directly to themselves, they basically use their accounts in the Central bank to effect such payments. The blockchain technology as it can be applied to banks (at least, in the sense you mean it) would mean excluding the Central bank from the process altogether. And why would the CB want to endorse that? Banks can't do that on their own since that would mean inevitable and inexorable recall of a banking license

Well I agree with the first part.
The second about pos and terminal I think it's out of question for a few or more or a lot more years to come.
It would mean such a radical change and just take a look at the credit card "revolution" in the us where it a headache to add a damn pin number.

And, sticking to the subject, it was the European central bank making the statement, and the ECB is not a commercial bank.
For them it will be far easier to implement the technology.

This is really similar to what I wrote few weeks before, that it's possible that the clients won't notice that anything has changed or not behind the scenes. Banks only needs to change the 'software' that runs in the background, people will use the same UIs. If banks start to use an international blockchain system, clearing the payments for themselves (not for the clients'), the clients will only notify anything if the process times becomes shorter. If the process times won't be shorter, blockchain technology could be still interesting for the banks if they can cut down some of the costs with this kind of new system.
One thing could be also interesting to banks, it's the POS network. Most of the banks have a lot of POS terminals at the merchants, shops, and if bitcoin becomes mainstream somehow, they can just update their POS terminals' software to accept bitcoin payments, and they can redirect the payments to given addresses. In this case, they can make some profit on the fees, because they already have the hardware, so it won't cost them more.

You're talking about bitcoin blockchain not the blockchain technology.
They will not use a blockchain that requires people to hash, they will use an internal blockchain not a public one.

There will be no hashing the way we know it, there will be no reward block.

They just aim at replacing their internal databases with this. It will not affect the the way they deal with clients.

The blockchain technology is of no use to the government

As well as to banking systems, especially those built around a Central bank (read all fiat banking systems in existence today). This technology is useful in circumstances where people don't trust each other but trust the consensus (i.e. Bitcoin network). In the case of a banking system with a Central bank in the center, the Central bank is the blockchain ("I'm the law"). The same basically pertains to government. As you can see, there is no viable application where the technology could be of any help for centralized systems. It is excessive for them, they don't need it

DARPA is where usually new technologies come to life studied, developed, figuring ways to use it as weapon-in military and after 20-25 years they release the tech to the world, we can't possibly know what they have now, what kinds of extraordinary gadgets-applications-hardware-software they're using because that's the way for every country though not just US.

Bitcoin was like a shock to the tech communities and still is, there are people specialized in searching and finding for ideas and new tech constantly and that's the reason why Satoshi vanished after less than 2 years of blockchain launching.

Bitcoin should've stayed in labs, private and used for private sectors at least 15 years and then released as an open source and essentially free technology, and that's why price is high, community trust the system-concept because we all can see what sacrifices Satoshi made for the good of the people, his intentions were pure.

Now why would we care what some central bank thinks or uses? hell with them, because of them we're in crypto jungle, as decentralization is equal to a lawless jungle.

it's no use for them now, they have their system which work good and don't have scaling issue, like bitcoin, if they are going to implent their own coin this coin would have the scaling issue, because could not handle what visa can today, and segwit isn't helping, segwit with LN could help bu still it's too new for them to grasp how it really work

I assume the blockchain technology they are talking about would be a private blockchain that they would create. I would expect that it would not be an open ledger but instead would be private.

The great thing about the Bitcoin blockchain is that it is an open ledger so it is public information. This is fundamentally different than some private blockchain that a bank or government would create.

The blockchain technology holds a great promise and enormous potential but the way I see it we can understand that it is never perfect and there are still so many things to do and improve to make it as it should be in the future. The current debate on the problem of scalability is something like a little of a black eye for Bitcoin. I am sure that soon things can be good for the blockchain technology as it can be evolving making it perfect for anyone to use and adopt.

Really, I can not understand, even though I live in Europe, why the ECB is so cumbersome compared with the central banks of other countries. Probably because it is the central bank of the 19 EU countries that have adopted the euro and the board which is the key of the ECB decision-making body is composed except from the six executive board members and from the governors of the national central banks of the 19 countries which belong to eurozone area.

European Central Bank has other problems and others priorities currently than to adapt Blockchain technology. It is not something you can decide to adopt in 1 week, and less something you can implement without be sure of the results. As they started to study the technology so it does mean they are not closed mind, at least they checked it. European politic  and economy are old school by nature

The European Central Bank will always stand on the protection of Euro positions. To this end, he exists. Why do they need to promote technologies that can lead to destabilization of the Euro? Besides, the European politicians are very conservative and bureaucratic. I think that the era of bitcoin will start with Asia.

Ledger is based on the blockchain technology. If the European central bank should be embraced the ledger technology which means they're adopting the blockchain technology.
This is just a hate speech by the ECB about the blockchain technology while other big companies such as JP Morgan, Microsoft, IBM have made a partnership with Ethereum to develop his future blockchain.
ECB must pay a lot in the future for use it. Ledger just a further development from the blockchain itself.

I read all of these posts, and I thought why everyone is obsessed with government recognition of BTC, cus' they are the ones who losing this game.

We are creating value for a number that smart people is willing  to control and operate, and we call it Bitcoin. That is the same thing as real money, a number which we believe and to make changes with that "believing value", which we change for our time, we developed possible dollar or any other currency on paper.

People trust the money because it's builded in such a way as to cover its value with gold, while gold at one point it was no longer mandatory coverage because the new monetary system is developed.

A scenario I see here on BTC revolution is same, but in our case, everything worth going in the total capitalization of BTC, and most is paper money.
Translated, people currently build trust in a brand new monetary system with funds that were created prior of Society of slavery (Egyptian mentality).
BTC is definitely a revolutionary thing for the reason that changes the direction of humanity and opens the door to a completely new lifestyle and change existing standards and principles in human life.

Will the natural course of changing in the priorities of the value to be realized fully, let's wait another few years and see for ourself's.

Whether in Europe there has been no support from his government.

This looks more like First April's joke

If you didn't think it up yourself, or course. In any case, I would like to see the source where you dragged this "citation" from. Obviously, without computers and means of communication (including but not limited just to Internet), the current banking system with its thousands of transactions per second would be completely unsustainable. Other than that, the banking sector has always been conservative, so you shouldn't blame Bitcoin for being like that too. In matters regarding money, it is always better to be safe than sorry

I agree with all your points

In other words, there is no need for banks to externalize their operations either through the blockchain technology or somehow else. On the other hand, I've read about an idea that banks could potentially use the technology between themselves, i.e. make a system which would exclude a Central bank out of equation completely (since with a Central bank the whole idea seems to be pretty meaningless). Anyway, this is not my idea (personally, I'm rather skeptical of it), so take it for what it is worth

I actually think they are right I mean the blockchain technology is great and it is a step toward replacing fiat with digital currency, but the problem is that it can’t handle the more volume like visa and besides that it will be hard to set people to do wait for the confirmation for the transaction while it will go on in the world, besides people are still not even ready for fully replacing the fiat with bitcoin.

"We here at the European Central bank feel that computers are a fad and we will not be using them. Hail to the typewriter."

That is a direct quote from the same people. They really don't like moving forward to bigger and better things. 

It is not question whether they should or shouldn't  - they simply cannot do it at all. How exactly would that work?
Blockchain which is not backed by significant number of hashing power is nothing more than glorified name for  standard database.
Do you think that few government servers would be enough to provide serious level of security for this tech?
Because I can't imagine that central bank would share their database with citizens or allow them participate in this project.

It is pointless to make a debate like this,blockchain is not all about crypto currencies but there are things that can be achieved at a lower cost because of it and any company would look into ways of making profit rather than paying for what they use and if there is a technology that could save them millions then they will try to profit from the technology .

I still see no points for institutions and centralized enclosures trying to profit from the blockchain technology. Why not just use proprietary software and internal databases for instant modifications of the data? Why do they need anything but good ol MySQL? this seems like a fad.
Real blockchain is cryptocurrencies period.

Using block chain does not literally mean that they are embracing bitcoin ,it is far from that,it can be used as a open ledger to store the data and it can cut down on costs in the future,banks really wont shed off its centralized nature when it comes to the economic side of things but block chain on the other hand will help them saving them dimes if they can utilize the potential .

They should. But they are not ready yet, so the timing is not good for them. This is why they're trying to put the whole technology out of the focus of their speech.
There could be several reasons:
- they're working on a similar technology (but centralized), and they're not ready yet, and they need time
- they don't want people to start investing in bitcoin or altcoins, because of the price volatility and possible margin calls, lost investments, etc.
- maybe they want to prevent people from the above mentioned problems, because if people have problems with the blockchain technology, the central bank's new, similar technology will be also be resisted or rejected by the people

As a Bitcoin user, I have to say that I still not understand fully what the Blockchain is and how it works although I have been heard for at least 2 years. However, I think that Banks are trying to refuse the decentralized system which appears in the Blockchain and as every knows, they still want to control the money and the property that we have. Moreover, I believe that the government is behind everything

Yes.

Why? Because it is of benifit to themselves.

Even China is thinking of doing it and already taking action upon it. I can't believe Europe isn't.

Fact is that it'll be easier for them to keep track of everything(except in countries like Switzerland i guess where privacy laws are strict), easier for them to create and distribute currency, and transactions are immutable.

Dunno why they don't like the idea.

A distributed ledger technology as you call it is not suitable for centralized entities

Strictly speaking, it is in direct antagonism with the very nature of such institutions like Central banks ("central" is a keyword here). Apart from that, if they actually create something like a decentralized distributed ledger (let's assume that for a moment), who exactly is going to make up the decentralized part of it and would they ever want to participate in the whole shebang? Right now, miners get a reward and fees, but even without these if mining were easily available to anyone, a lot of people would be running full nodes to support the network since they are interested in keeping Bitcoin alive and ticking. Why would they ever want to keep government money alive if they already have Bitcoin?

I'm surprised that they're opting to go with the "too early" response, maybe it's because of the required amount of energy to confirm everything but considering that the EU wants to control everything about its citizens and it wants to know everything that's going on, I would assume they would be more behind something that lets them keep tabs on literally every financial transaction.

Maybe they're trying to figure out how to control the mining system so only the government mines and can keep the difficulty steady so that there are no competitors.

The European Union's central bank today once again shot down the idea that it might use distributed ledger tech as part of its market infrastructure in the near future.

Published alongside the latest annual report from the European Central Bank, released on  tuesday, was a feature on the tech. While largely written in broad strokes, the paper reiterates a position expressed in the past by ECB officials – namely, that the central bank isn't likely to tap distributed ledgers in the near future.

Do you think eurozone central banking should embrace distributed ledger technology?