None of these features require a blockchain and can be done trivially by a central authority issuing append-only cryptographically signed ledger entries.
> Large value transactions can be done between untrusting parties directly...
What's the benefit of this when the bank has to accept a cleared record for a party to withdraw funds anyway?
>None of these features require a blockchain and can be done trivially by a central authority issuing append-only cryptographically signed ledger entries.
Why would you want to depend on a central authority when you can have a network of trusted blockchain users all signing and broadcasting their transactions to each-other in real time, without an intermediary?
Why hamstring yourself with a database and the upgradability woes therein, when you can use a blockchain?
>What's the benefit of this when the bank has to accept a cleared record for a party to withdraw funds anyway?
With a permissioned blockchain, the funds can be cleared much faster (instantly?) than in the current system.
I left another comment about this. These technologies are very powerful and not thoroughly explored in a permissioned context for use by traditional finance.
> Why would you want to depend on a central authority when you can have a network of trusted blockchain users all signing and broadcasting their transactions to each-other in real time, without an intermediary?
You're already depending on a central authority to back your funds. So forcing a blockchain into the mix just introduces that additional complexity and risk, not a new dependency on a central authority.
> Why hamstring yourself with a database and the upgradability woes therein, when you can use a blockchain?
You're conflating "blockchain" with "distributed database". For example, a trivial example is a git repository storing ledger entries. It's distributed, can be used in an append-only fashion (and enforced at a higher layer), and such a system probably doesn't have the "upgradability woes" you're worried about. It's not a blockchain.
> With a permissioned blockchain, the funds can be cleared much faster (instantly?) than in the current system.
> Why would you want to depend on a central authority when you can have a network of trusted blockchain users all signing and broadcasting their transactions to each-other in real time, without an intermediary?
The choice here is between:
1. A known intermediary with a physical address to which a judge/magistrate can have a summons mailed and which my local elected government officials can at least in principle regulate, or
2. An unknown number of unidentified intermediaries, at least some of whom are almost certainly beyond jurisdictional reach.
If I'm fucking around with gambling money, whatever. If we're talking about national payment infrastructure, the choice is obvious.
> [databases and] upgradability woes therein, when you can use a blockchain
I think you misunderstand. The answer is most likely
3. A consortium of permissioned parties. I'm assuming at least the 3 major banks and some if not all of the 70 companies.
This is similar to Diem (aka Facebook Libra). PoA (Proof-of-Authority) as opposed to PoW or PoS.
The point is that the parties keep each other in check, and collectively have some level of fault tolerance. At the scale of a national economy, it's desirable to not have a single point of failure on an institutional level.
If you think "Signed Git+Raft/Paxos", that's pretty close.
I'm curious if they'll allow some level of unpermissioned access to the chain and/or for individuals to manage their own keys. The pessimist in my thinks no, but one can dream.
Blockchains rely on intermediaries to process transactions. The difference is, in a blockchain-based system, the end user has no freedom at all to choose which intermediary they want to use. The intermediary is chosen at random, according to how much useless computations they have done. And because of these useless computations, the system is also less economically efficient, in other words more expensive, compared to alternatives.
> None of these features require a blockchain and can be done trivially
what can be done and what is done -- different. You might want to tell those companies that charge a fee to guarantee the transaction, that they can just trivially stop doing that now.
> Large value transactions can be done between untrusting parties directly...
What's the benefit of this when the bank has to accept a cleared record for a party to withdraw funds anyway?