Blockchain database; technical background and a reconnaissance on an implementation within the banking industry
Abstract: All human interaction can be depicted as exchanges. We exchange trivial information, feelings, assets and more. Valuable exchanges have one thing in common; they all require some degree of trust. In today’s society we rely on institutionalized trust when commencing an exchange of value. Typically, this role is filled by a vast ecosystem consisting of commercial banks, clearinghouses and other third parties. The recent rise of Bitcoin, Ethereum and consequent attention on the underlying technology, blockchain, questions the future of current ecosystem. This report aims at uncovering what blockchain is, what different implementations are currently available and how it would affect today’s ecosystem. It does so through semistructured interviews with actors within the current ecosystem as well as weighing in the views of blockchain evangelists. It highlights five key aspects that are crucial when implementing blockchain technology within the existing banking paradigm. Today’s organized societies require law and order which, to a large extent, is limited within the realm of public blockchain technology. With the insight of society’s infrastructural limitations, this paper argue that the current transaction system of our society favors a permissioned implementation with trusted nodes. Such a system would result in more efficient financial markets and lower costs of transacting. However, this paper acknowledge the virtues and reasons behind the rise of public blockchains. Given recent developments within the field and interesting concepts, the report does not dare to exclude a future of banking relying on public blockchain technology as the underlying database.
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