blockchain – Michmutters

Has blockchain found a use beyond crypto trading?

The bitcoin boom spawned new billionaires and videos of beach parties and Lamborghinis. The crypto crash brought devastation for small investors and bankruptcy for many companies.

Blockchain technology underpins crypto and has been hailed as a world-changing innovation, but does it have any use beyond creating speculative financial instruments?

– More secure voting? –

A “blockchain-based mobile voting app”, I tweeted, would mean “we won’t have to wait for results, or have any questions on its validity”.

So far, experiments have been very small scale.

“From the American perspective, every single district runs its own voting programme,” he said.

“Centralizing the voting system in one digital place would be pretty risky -– then all you have to do is corrupt the blockchain and you could corrupt democracy.”

Blockchain at heart is a ledger, a way of storing transactions that is — according to fans — secure, transparent and permanent.

Diehl said it was “absurd” that the blockchain was “going back to things that were solved a millennium ago to justify its own existence”.

“The blockchain isn’t solving anything here.”

The blockchain emerged from a 2008 white paper on bitcoin, which was conceived as an alternative to fiat currency.

Bitcoin was the first cryptocurrency. There are now more than 10,000 others sitting on many different blockchains.

Diehl pointed out that cryptoassets are speculative instruments not suitable for payments.

“It just doesn’t happen. You want something that’s going to be stable so the price of your coffee is the price of your coffee next week.”

Want to know where your handle came from? Some supermarkets believe the best way for you to find out is to access a blockchain-based system capable of tracking the fruit from the tropics of Central America to your cornerstore.

Carrefour told AFP earlier this year that shoppers would be able to scan a QR code and discover the provenance of an array of products.

Diehl pointed out that digital supply chain management has been around for years and is perfectly adequate without blockchain.

“If I have a carton of apples and report that I put 100 percent of them on the truck, but then I skim off 50 percent for myself, the blockchain is not going to prevent that.”



Reserve Bank to trial digital currency in ‘limited-scale pilot’ scheme

The Reserve Bank of Australia will trial its own digital currency as part of a research project to evaluate the future of Central Bank Digital Currencies (CBDC) in Australia.

Unlike well known cryptocurrencies such as Bitcoin and Ether, which were created by private entities or individuals, a CBDC is issued and controlled by the central bank just like cash and electronic stores of sovereign currency sitting in bank accounts.

The research project the RBA is undertaking in collaboration with the Digital Finance Cooperative Research Center (DFCRC) will focus on the uses for, and potential economic benefits of, a CBDC.

“The project, which is expected to take about a year to complete, will involve the development of a limited-scale CBDC pilot that will operate in a ring-fenced environment for a period of time and is intended to involve a pilot CBDC that is a real claim on the Reserve Bank,” the RBA noted in a media release.

“Interested industry participants will be invited to develop specific use cases that demonstrate how a CBDC could be used to provide innovative and value-added payment and settlement services to households and businesses.”

RBA deputy governor Michelle Bullock said this project is “an important step” on the path to a potential Australian CBDC.

“We are looking forward to engaging with a wide range of industry participants to better understand the potential benefits a CBDC could bring to Australia,” she said in a statement.

Dr Andreas Furche, the chief executive of the DFCRC which is undertaking the research project with the RBA, said the doubts around CBDCs are mainly focused on how useful they could actually be, and in what ways.

“CBDC is no longer a question of technological feasibility,” he argued.

“The key research questions now are what economic benefits a CBDC could enable, and how it could be designed to maximize those benefits.”

The Reserve Bank said Treasury is involved with the project, which will soon invite industry participants to pitch specific uses for a CBDC that might be selected for trials in the pilot.

The project will then help to understand some of the technological, legal and regulatory issues that arise from a CBDC.

A report on the results of the project is expected in about a year’s time.