I’ve spent far to much time researching this only to find that one podcast episode explains it perfectly.
“I’ve never seen so many people searching so hard to find a problem for their solution.”
This podcast is being read from an article in Dutch so there may be some grammatic differences to traditional English.
Always trust the Dutch when they whistle blow on banking and crypto. They have literally HUNDREDS of years dealing with corrupt banking systems.
In the most basic of terms, blockchain is a method of encription that works from standardized increments of a puzzle that all the users of the same system share and feed in to in order for any changes to occur.
That is virtually no different than a network spreadsheet system or shared data systems for medical coding, shipping or literally any share data management.
The only real differences in blockchain aren’t any different from major issues of identity, data and security that earlier versions of the internet suffered decades ago. This has ultimately served as a break in the armor in getting blockchain to catch on as it’s creators and proponents had hoped.
Proponents such as the all time golden boy of the idiocracy Elon Musk.
The first and foremost being that no data added to a blockchain can be removed from it with any sort of reasonable ease. It literally becomes the blockchain. Through the evolution of crypto currency blockchain, a massive amount of child porn and other horrifically illegal content transactions and contributions made their way into the blockchain from malicious users and ultimately became a standardized portion of the process. Because there is no administration process to filter or alter content and no system of available editing. Nothing can be done with any ease to remove malicious content.
This is a problem people ran into in the early days of administrating and using early dial up networks with shared files and databases over systems moving under 300b over standard telephone lines. THAT WAS IN THE LATE 1970’S FFS!!
Meaning in this aspect, blockchain has simply brought a very old and stupid issue with the earliest form of the internet into this era of the information age and at much higher speeds.
The other major issue is easily pilferable identity you have as a user of the blockchain.
You have a number as a user and if you use social network and email which may have carried any portion of your activity on the blockchain you use, your identity is far easier to find than with traditional banking and security software.
The podcast and article go on to describe how Many of he Clinton Email hackers were identified by easily identifiable bitcoin account activity which gave authorities all of their identifying information.
AGAIN, this is another issue that early dial up network systems suffered when people were being assigned group access accounts on early file and database sharring systems.
The 1982 movie Tron notes a perfect example.
One issue being when the MCP locks an entire group out of the system then later Alan and Flynn forge a higher group access account with some simple trickery to the antiquated network access systems. Individual identities can be far to easily exposed or forged.
Researches investigating Blockchain have been able to find TENS OF THOUSANDS of Bitcoin users and their entire identities from cross referencing their social network activity.
By use of snyping and transaction trackers, you can easily find the identities of blockchain users from online transactions.
The theft of blockchain system currency and data is also permanent as the transactions become permanent and inarguable once completed. With standard banking virtually every transaction can be halted and reversed.
Currently, even with bitcoin making up less than 1/6th the online transaction and banking activity of the world, nearly 15% of all bitcoin by volume has been stolen.
Blockchain also has a massive environmental issue.
The complexity of this incremental puzzle system which results in an absolutely useless and entirely unsafe operation uses a MASSIVE amount of power in processing and database operations.
For the two largest cryptocurrency providers in the world (Bitcoin and
Ethereum) it takes just as much power to operate as is used by the entire country of Austria.
That is a significant carbon footprint for a method of cyber security that doesn’t provide any actual security.
For a more direct comparison:
A single transaction with visa requires 0.002KWH of electrical power.
A single transaction with bitcoin requires 906KWH (NINE HUNDRED AND SIX KILOWAT HOURS) of electrical power.
This is more than HALF A MILLION times the electrical power of a visa transaction.
It is enough electricity to power a two person home for THREE MONTHS.
Each and every operation of a blockchain system is a planet killing nightmare the larger the system and volume of users are.
This may be why NASDAQ and the Dutch central bank in recent years have abandoned prospects to integrate blockchain as a form of security software.
Proponents of Blockchain have touted that it could solve corruption issues with governments, the porn industry and municipal law enforcement.
However the reality is that Blockchain is only a database and a database at the mercy of far to much intrusion. Once data is changed it can not be changed back and if corrected, there is still a power drag on the system from massive amounts of junk materials that still can not be moved from the process of power consumption, corrected or removed from the system entirely.
There are also no corrective measures for the system when dealing with bad and fraudulent information and activity.
“Data should reflect reality.” is the other most notable quote from the podcast.
In the end, blockchain can not properly account for the reality of any real world system it attempts to accommodate or any go-between system like bitcoin.
Lies can be told, trash data used as valid, identities not secure and a rampant wasteful usage of the power grid to boot.
Not to mention all of the people out there who are so ignorant of basic finance that they are committing suicide and losing millions because they cant understand fraudulent user agreements or remember a password.
Now, the typical pseudo intellectual futurist, Elon Musk worshiping fanzoid will of course argue back, “well what better encryption systems have been developed other than blockchain.
The answer, SEVERAL.
In the mid 1990s cyber security developers began playing with the idea of using real world random variables such as livecast captures of lava lamps in order to generate random numbers that couldn’t be predicted by hackers.
The concept took time to develop but today roughly 10% of all internet activity is safe guarded by Cloudfire systems which use a number of different livecast capture methods with lava lamps, radiological decays and random clockwork pendulums.
This same method is now being used by the NSA and development is continuing toward a real time peer to peer transaction method.
This is not unlike the real time capture encryption method used in the movie Johnny Pneumonic.
In the movie, the people downloading the information to Johnny’s mind, encrypt the information by pulling random images from different channels on the TV. Then binding the images to the download and sending the images to a receiver who would then use the images to unlock the files when Johnny makes it physically to his destination with the files.
This process creates a secure gap between point A and B creating a peer to peer gateway that can only be accessed at one point and with one specific and randomly generated key.
Of course in the movie the entire sequence of images did not arrive at the receiving source and not all of the images were destroyed at the sending source which gave the bad guys a portion of the encryption.
The use of television images also gave anyone who wanted access an available backlog which would not take much effort to recover and formulate as long as they knew the relative time and available broadcasts the images were pilled from.
Hence, the use of a more real world and organic system like the motion of lava lamps, would make a better source medium for generating an encryption base for both database structures and a peer to peer security transfer system.
Blockchain is simply a very old, costly and dumb idea.