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The financial sector's enthusiasm for blockchain technology might be misplaced, according to a pair of Australian distributed computing experts.
The problem: if everyone in a consortium trusts each other, they don't need blockchains to protect themselves; if they don't, current blockchain protocols have a flaw that allows a bad actor to game the system.
The warning comes from CSIRO/Data61 researcher Vincent Gramoli, lead author of an arXiv paper describing what he and colleague Christopher Natoli call "The Balance Attack" (the name comes from one aspect of their attack, that it's deployed against subgroups of nodes with balanced mining power).
In the finance/banking context, Gramoli says the problem is that blockchains are probabilistic, but for something like an inter-bank transfer, you need determinism. If the system enters a state in which it can't guarantee all transactions, downtime is the best solution.
Gramoli told The Reg "if the assumptions are not met, users should get a message that 'the system is not available, please try again later'".
Source: The Register
(Score: 4, Insightful) by Nerdfest on Tuesday January 17 2017, @04:36PM
I'm sure this won't actually be a problem. What are the odds that members of the financial sector are not going to be trustworthy, or will try to game the system.
(Score: 2) by Scruffy Beard 2 on Tuesday January 17 2017, @04:45PM
It has happened before. Some miners don't actually check the previous block before working on the next one. In my experience (with a pentium D) you can save ~13 seconds doing that (of a 10 minute, or worse, 30 second (P2Pool) block interval)
(Score: 2) by arslan on Tuesday January 17 2017, @11:43PM
Actually that happened last year. Not so much they aren't trustworthy in principle, but they got hacked. The whole debacle about the SWIFT network last year pretty much shows this. The weakest link in the payment network was haxored and the attackers used them to generate transactions.