Two banks in Australia have successfully used Blockchain on their commercial property...

[William Gayde]

Blockchain technology is commonly associated with Bitcoin and other cryptocurrencies, but it also has considerable uses in the financial services sector. Two major banks in Australia have put the technology to the test by successfully implementing blockchain for bank guarantees on their commercial property transactions. What is blockchain you might ask? Blockchain is a decentralized and distributed digital ledger that is used to record transactions across many computers, so that the record cannot be altered retroactively without the alteration of all subsequent blocks and the collusion of the network.

Image credit: BusinessInsider

The banks in question, ANZ and Westpac, worked in collaboration with IBM to digitize their guarantee process. This replaces the old process of issuing, tracking, and claiming guarantees with a modern single source of information. The small trial was based on the Distributed Ledger Technology and Hyperledger Fabric, a project hosted by the Linux Foundation.

Unlike traditional pen and paper deals which can be forged or even modern computer systems that can be hacked, a blockchain based system is virtually impossible to fraud. The digital signature of each block, which stores transaction information for the network, can be used to encrypt the next block. This means that if a hacker wanted to create a phony record, they would need to modify every subsequent block and need everyone using the blockchain to agree on the fraudulent transaction which makes it much harder to accomplish.

The banks are encouraging other industries to pursue blockchain-based technologies to help heighten security, save money, and increase efficiency. IBM believes blockchain has the potential to drive production across many industries in Australia if it is adopted. Blockchain as a Service (BaaS) platforms like Stratis have also shown significant future potential.

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https://www.techspot.com/news/70061-two-banks-australia-have-successfully-used-blockchain-their.html

 

[Evernessince]

Imagine a future where transactions are verified by anonymous computers who donate their resources. That's the concept Crypto currency and block chain bring to the table. It would drive the transaction fees down and make is so that anyone can have access to payment verification. Right now you need a middle man who is skimming off the top, around 2.5 to 3.5%, of every transaction made.

 

[merikafyeah]

Bitcoin transaction fees depend on a number of factors and can get somewhat complicated, but all you really need to know is that no matter what, the Bitcoin transaction fees will always be much lower than traditional processing fees by the likes of PayPal, Western Union, Visa, etc.

The vast majority of Bitcoin transaction fees are less than 1 USD, often what amounts to pennies per transaction.
http://bitcoinfees.com/

 

[mbrowne5061]

Bitcoin transaction fees depend on a number of factors and can get somewhat complicated, but all you really need to know is that no matter what, the Bitcoin transaction fees will always be much lower than traditional processing fees by the likes of PayPal, Western Union, Visa, etc.

The vast majority of Bitcoin transaction fees are less than 1 USD, often what amounts to pennies per transaction.
http://bitcoinfees.com/

This article has nothing to do with bitcoins.

 

[merikafyeah]

This article has nothing to do with bitcoins.

My post wasn't really about Bitcoins either but the transaction fees incurred by blockchain-based transfers. If a bank wants to use the blockchain, even without fees being sent to miners, there is still a small overhead associated with every transaction. Will the banks simply eat this cost?

Also, which blockchain will they use if not the Bitcoin blockchain? Fork their own? Who else would use it? The blockchain is only robust because many people are using it. If the bank uses a blockchain which only they use, then a malicious actor with more computing power than the bank could potentially take over the chain and insert bad entries.

 

[mbrowne5061]

My post wasn't really about Bitcoins either but the transaction fees incurred by blockchain-based transfers. If a bank wants to use the blockchain, even without fees being sent to miners, there is still a small overhead associated with every transaction. Will the banks simply eat this cost?

Also, which blockchain will they use if not the Bitcoin blockchain? Fork their own? Who else would use it? The blockchain is only robust because many people are using it. If the bank uses a blockchain which only they use, then a malicious actor with more computing power than the bank could potentially take over the chain and insert bad entries.

This article is not about the bitcoin blockchain. These banks attached the Australian dollar to an experimental blockchain they are working with, nothing more. Since it is their own blockchain, that they are using for R&D, they can simply not implement the overhead costs in their transactions (yes, it still costs energy - so does a normal Bank Guarantee).

Blockchain tech is just a mathematics proof when you get down to the nitty gritty of it. Anyone can make their own blockchain for whatever purpose they like, and they can structure to suit their needs to some degree. Banks will probably come together, define their own blockchain(s) for managing transactions in the near future. It will have nothing to do with the bitcoin, or any other cryptocoin, blockchain. It will function as a transaction ledger, rather than an 'organic' economy (as cryptocurrencies do), and it will be very difficult for any one actor to come by more computing power than a single bank.