SoylentNews is people
SoylentNews
Nobel Prizes are given for making important — preferably fundamental — breakthroughs in the realm of ideas and that just what Satoshi Nakamoto has done according to Bhagwan Chowdhry, a professor of finance at UCLA, who has nominated Satoshi Nakamoto, the creator of Bitcoin, for a Nobel prize in economics. Chowdhry writes that Prize Committee for the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel, popularly known as the Nobel Prize in Economic Sciences, has invited Chowdhry to nominate someone for the 2016 Prize and he started thinking about whose ideas are likely to have a disruptive influence in the twenty first century.
"The invention of bitcoin -- a digital currency -- is nothing short of revolutionary," says Chowdhry. "It offers many advantages over both physical and paper currencies. It is secure, relying on almost unbreakable cryptographic code, can be divided into millions of smaller sub-units, and can be transferred securely and nearly instantaneously from one person to any other person in the world with access to internet bypassing governments, central banks and financial intermediaries." Satoshi Nakamoto's Bitcoin Protocol has also spawned exciting innovations in the FinTech space by showing how many financial contracts -- not just currencies -- can be digitized, securely verified and stored, and transferred instantaneously from one party to another.
There's only one problem. Who is Satoshi Nakamoto? Suppose that the Nobel Committee is convinced that Satoshi Nakamoto deserves the Prize. Now the problem it will face is how to contact him to announce that he has won the Prize. According to Chowdhry, Nakamoto can be informed by contacting him online just the same way people have communicated with him in the past and he has anonymously communicated with the computer science and cryptography community. If he accepts the award, he can verifiably communicate his acceptance. Finally, there is the issue of the Prize money. Nakamoto is already in possession of several hundred million U.S. dollars worth of bitcoins so the additional prize money may not mean much to him. "Only if he wants, the committee could also transfer the prize money to my bitcoin address, 165sAHBpLHujHbHx2zSjC898oXEz25Awtj," concludes Chowdhry. "Mr Nakamoto and I will settle later."
(Score: 2) by JNCF on Monday November 09 2015, @06:44PM
I think there are multiple prerequisites for a network like Bitcoin to succeed, and a strong community is certainly one of them.
I'm not sure why you think the scheme (by which I think you mean the blockchain) isn't special or useful. Do you have an alternative suggestion for a completely decentralised ledger system that protects against double-spends?
(Score: 2) by JoeMerchant on Monday November 09 2015, @10:38PM
If you posit thousands of nodes cooperating to validate transactions and prevent double-spends, then sure, lots of alternatives to block chains can be made.
The whole "can't forge it because it's too much work" aspect is a short sighted fallacy, IMO. I would prefer something reputation based where actors cryptographically positively identify themselves and then gain reputation for accurate/fair dealing as they process transactions - more like credit scores in the real world, but in the world of crypto-currency there would be a much lower (say: zero) tolerance for cheats... Instead of effectively breaking hash codes for cash rewards, servers can demand progressively higher transaction fees for high availability and low latency accurate reputation reporting. If you want to develop a credit score, you can put some cash on deposit with a respected reputation server who will cover your transaction incase you fail to do so - as your reputation is established, other reputation servers might compete for your business with lower transaction fees and/or smaller marginal deposit requirements.
Of course, this, or any scheme will fall apart if the people that make up the core network charge too high of fees, or simply don't exist to provide the necessary services. Therein lies the Satoshi genius: harnessing the "something for nothing" greed of people, people who have the resources he needs, and getting them to provide those resources willingly, in sufficient quantity to provide the infrastructure. Without that exceptionally strong motivation piece, most schemes will be doomed by greed, overtaxing by the service providers, and lack of interest as people pursue competing strategies.
🌻🌻 [google.com]
(Score: 2) by JNCF on Tuesday November 10 2015, @12:28AM
I don't think you're talking about a ledger system, I think you're talking about a web of trust reputation system with an insurance system backing it up. Besides not being a ledger system, this relies on governments to make the private insurance companies cough up payment when it is due.
A blockchain is completely decentralised. Once a bitcoin has been transfered and has a reasonable number of confirmations, you don't have to rely on any government or corporation. The math says that your cryptographic signature is required to move the digital asset, and any block that tries to move it without your signature will be rejected by the network.
Also, your web of trust reputation system relies on the existence of trusted communication channels. With a blockchaim you don't have to trust a source of information to confirm that it is giving you an accurate view of the ledger. The amount of work required to fake a reasonable number of confirmations is the same amount required to do a double spend attack, so even if you only have one shady connection to the Bitcoin network you can tell whether or not it is giving you copies of the consensus ledger.
I remain convinced that the blockchain is a unique and useful invention.
(Score: 2) by JoeMerchant on Tuesday November 10 2015, @03:43AM
While I am talking about a web of trust, I am not talking about government enforced insurance payments - I am talking about trusted "insurance providers," who, in essence, are putting their own trust reputation on the line when they back a transaction. If you are new to the system, you can either get a friend to vouch for your ability to pay (for free), or pay a provider to do it for you, through deposit, fee, or both. Government is not required, a transparent system that accurately reports transaction success and failure is. If you want to participate in the system, you prove yourself to be a trustworthy actor. This is an idea I have mostly hatched in the back of my head with no real development, as opposed to Bitcoin which has been raked over the coals by the world for nearly a decade now - so, let's not get too critical of the lack of detail here. The main departure point from Bitcoin, in my opinion, is the lack of dependence upon a particular computing problem being a particular kind of "hard" (and, yes, I know about the increasing complexity...) and the setting of a rather large amount of energy expenditure required to successfully validate a transaction, coupled with a large pool of competitors looking for that solution. Take the hash table scheme and try to validate every cash transaction in a modern city in a day, and you've completely trashed the system. If every time you spend money on lunch, gas, groceries, etc. etc. etc. were to run through a Bitcoin style validation, it would be impractically complex and energy demanding.
The web of trust's main weakness, as I see it, is guaranteeing the identity of the actor - this would be done with traditional cryptographic techniques, and, assuming the web validates, say, 100 identities in an average transaction, significantly less complex than searching for a single hash collision.
I'm not saying that a blockchain is useless or obvious, I am saying that it is not a practical replacement for cash or credit as we practice them today. It is a clever system with a large hidden cost that would be inevitably exposed if it were scaled up to try to replace cash and credit.
🌻🌻 [google.com]