Top five Blockchain Technology Myths the Mainstream Has Fallen For, Bitconnect

Top five Blockchain Technology Myths the Mainstream Has Fallen For

Top five Blockchain Technology Myths the Mainstream Has Fallen For

The legacy banking and financial system think they’re so brainy. They actually think they are much smarter than the Bitcoin community, and to prove it they are racing each other to lift Bitcoin’s blockchain technology away from the digital currency for their own usage. It is unknown just how useful blockchain technology will be without a digital currency tied to it, or if these companies can make it into anything other than the slow database that it is. This may be better than the decades-old systems they presently use but have they found lightning in a Bitcoin?

Gartner is a global insight IT leader when it comes to analytics and technical expertise. With clients in more than ninety countries around the world and more than 1,100 accomplished analysts that cover 1,304 IT topics, they have a good understanding of all information technologies. In a fresh analytic report, according to MIS Asia, Gartner analysts Ray Valdes, David Furlonger, and Fabio Chesini collective several common myths about the Bitcoin blockchain and how they will apply to the world going forward. Let’s look at five of them, shall we?

Five Fingers of Death?

Myth 1: The blockchain is a fresh cloud-based database that will switch the world

Not exactly. The blockchain is not a fresh type of computer or the ideal foundation for “The Internet of Things”, nor is it a “general purpose database.” It is basically a vapid file, or a linear list of elementary transaction records, the analysts said in the report.

"This list is ‘append only so entries are never deleted, but instead, the file (presently about fifty gigabytes), grows indefinitely and must be replicated in every knot in the peer-to-peer network (thereby introducing scalability and latency issues).”

Myth Two: The ledger represents an irrevocable record

This is pragmatically correct, the analysts said, but it is “theoretically possible for a party to accumulate enough hashpower to rewrite the record all the way back to the Genesis block (the very first block of a blockchain).”

"Such an activity would work against the incentives of the usual participants in the Bitcoin ecosystem because it would demolish all user confidence in the blockchain technology and the commercial economy it supports,” the report reads.

In other words, let's say you are commencing a fresh blockchain, and this blockchain is not seven years old. Let’s say that your fresh blockchain does not have more CPU hashpower than any other computer system on Earth, therefore it would be fairly effortless to overpower it with a “51% attack”. If you are a major bank attempting to build a private financial network, how long will it be before a puny group of hackers, that can’t hack tho’ Bitcoin’s blockchain, take your much smaller and weaker blockchain for all its worth?

Myth Trio: Blockchain technology is scalable to the level of a global economy

People who are within the Bitcoin community see very clearly there are scalability issues with Bitcoin’s blockchain, but those outside may not take these issues very earnestly, or believe these are lightly overcome. In the real world, this may not be the case, say the analysts, and it may be even more limited than publicly perceived.

"This number is due to the constraint of a maximum block size of one megabyte, combined with around a 10-minute confirmation delay per block which, depending on the average transaction size, results in a maximum capacity of seven transactions per 2nd (tps),” the analysts said in the report.

“Actually, due to the enhancing size of transaction records, this number has been decreasing and is now estimated at less than three tps, a puny number compared to the peak capacity of, say, the Visa network at 47,000 tps or Nasdaq’s potential of one million tps,” the analysts said.

Myth Four: The blockchain can be decoupled from the currency or digital token

This is the big one, especially when it comes to banks and financial institutions who don’t want to give leverage to a decentralized currency like Bitcoin. In its present form, bitcoin is a key part of the blockchain, the analysts said.

"The blockchain is simply a list of bitcoin-dominated transactions. Also, the design of the consensus mechanism relies on the currency providing the incentive for miners to confirm transactions. Therefore (as some members of the bitcoin community have said), anyone who states that the currency is not significant and can be overlooked in favor of the blockchain, does not understand the technology and how it works,” the analysts said.

Myth Five: Bitcoin transactions are anonymous, instantaneous and absolute.

“In the bitcoin technology stack, participants in transactions are pseudonymous,” the analysts said. “Regarding transaction speed there is, by design, a minimum 10-minute latency in confirming transactions, and pragmatically, one could wait for an hour for confirmation. Transactions on the blockchain are probabilistic rather than absolute, in that it is theoretically possible for an attacker to build an alternative chain (a data fork) that would permit dual spending. Unless the attacker has a majority of hashing power, this will not succeed.”

Author : Evander Wise

Evander Brainy worked for many years as a Wall Street banker, and has learned how the economy is self-destructing from the inwards. His travels, practice and research have led him to Bitcoin as the best way forward for the common man. He looks to spread the word on how Bitcoin can help anyone break the fetters of economic slavery being created by global establishment coerces. Evander gets you thinking about what money indeed is, and how it will work for you going forward. The world of finance is getting ready for incredible switches, and he is getting ready for what's coming next. Are you? Learn more about "The Future of Money" @ Bitcoin Movie University

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