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Comment by lawn | Hacker News Reader

> The pilot will run until February 2021 and will use block-chain technology, the Riksbank said.

Will it really?

Riksbanken can have a central server to resolve any double spends, which is only really a problem in a decentralized network. Once you have a singular authority you can just let them decide, and you'll have no need for an inefficient cryptocurrency.

> which is being developed by consulting firm Accenture

Accenture is quite famous for developing bullshit solutions for made-up problems, so I guess this is a good fit for them.

> The sharp decline in the use of cash and competition from alternative currencies, such as Facebook’s Libra, has also prompted central banks around the world to consider issuing their own electronic currencies.

This is poor reporting, as e-krona predates Facebook's Libra, which is still far from being launched. They probably mean the perceived competition from Bitcoin.

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> Accenture is quite famous for developing bullshit solutions for made-up problems, so I guess this is a good fit for them.

Came here to see what consulting firm was behind this tomfoolery.

> Once you have a singular authority you can just let them decide, and you'll have no need for an inefficient cryptocurrency.

Unfortunately the mass of confused language around blockchainism has made its own miniature political weather system, and consequently there is a growing niche for such Potemkin Decentralization models.

I would even buy the argument that all decentralization models turn out to be mere smokescreens that misdirect the focus of critical attention on to one aspect of a complex system, only to obfuscate de facto centralization accumulating in a different part of that same system.

By the time this concentration of leverage has become too dominant to hide, the new Potemkin Decentralization system has made serious inroads into the incumbent it seeks to displace.

Problem with a central server for money is that it makes the whole state vulnerable. If everybody use central bank e-currency you can just attack their sever to destroy the flow of all money.

But if it is distributed like real crypto currency, you have to be able to attack and take down hundreds or thousands of severs geographically spread.

I don’t know why your comment is being downvoted. That was my understanding as well. A distributed ledger is much harder to tamper with, which is why “blockchain technology” is actually a reasonable solution to this problem, IMO. I am open to being proven wrong, though

I did not downvote him, but a cryptocurrency is only tamper proof because the entities that decide the rules are distributed (in Bitcoin it's the miners who extend the blockchain). So to being down the Bitcoin network you need to bring down all the miners, which is basically impossible.

But here there's only a single entity that decides the rules. So if you shut down riksbanken's servers, the servers that are deciding which transactions are valid, you essentially shut down the network.

Sure you can have thousands of servers around the globe sharing the last seen state or new but not yet verified transactions, but that's not a very useful network. They would instantly be discarded once riksbanken's servers come online to sort out the mess.

You can have this problem in Bitcoin too, if you isolate a majority of the miners from the rest of the network, essentially splitting it in too. But that's much harder to do.

Edit: Here I refer to deciding double spends, which the critical problem any digital currency needs to solve. Without it anyone can print money out of thin air.

I don’t disagree with you, but central server for money is what we have had since the beginning of time right? We have central banks, where banks have cash, and and central securities depositories, where they have their securities.

Yup, this is nothing new.

When one of these banks inevitably gets hacked, we're talking billions stolen overnight.

Part of the appeal of Bitcoin was it's decentralized authority, giving people more confidence in a currency that was digital.

It seems inevitable that when the buzzwords wear off some executive will ask "So we have this central server we trust right? Why not just use that?"

Nah, they'll just kill the project when it fails and move onto the next buzzword

External Auditing. I can't audit the central bank's server but I can audit the publicly published blockchain.

This can be solved by making all ordinary transactions public. Blockchain is not needed in 100% of the cases when central authority is in place.

There is a difference between deciding all transactions will be published and making them public by design constraint. Blockchains make transactions public by design, and this design cannot be easily subverted by the people running it.

Not really. Ever heard Monero or Zcash fe?

I certainly have. But this system is not designed like them.

All transactions in both Monero and ZCash are public, and we can verify that they're valid.

But what we cannot do is see all transactions details, such as the transaction amount.

These are two different things.

> There is a difference between deciding all transactions will be published and making them public by design constraint.

In a "blockchain" with a centralized validator set, there's no constraint forcing transactions to be public. The network will keep running even if the validators decide to stop publishing transactions. It's very much still a social contract.

Tampering (adding false transactions) is the only thing that could be hampered thanks to the requirement of client signatures: transaction/partial information censoring will still be possible. But in reality such a system will have the design constraint that funds must be seizable by the government, which in turn negates the only remaining technical advantage of a "centralized blockchain".

All that's left is the now empty word "blockchain". It's going to fit perfectly next to "democracy".

Right, but users would know when a secret transaction has been added. And no, your example does not negate the only technical advantage. Governments are not the only entities that might tamper. And most importantly, a blockchain forces even government tampering to be transparent, whereas a private database does not.

Yes, it's less black and white than I suggested, but the improvement is still a minimal increment compared to what someone would expect when hearing "blockchain". I guess I'm afraid the public record would just end up looking like this:

https://upload.wikimedia.org/wikipedia/commons/0/09/Redacted...

with citizens unable to discern between abusive and reasonable interventions.

It's buzzwords being thrown around again. Blockchain is highly inefficient for anything other than decentralized consensus.

For sure, doesn’t seem like there’s a need to solve for adversarial Byzantine style attacks here. Even a permissioned proof of authority blockchain is overkill for this (which is most likely what Accenture is building/configuring for them)

Maybe the blockchain is meant for "offline" transactions, when neither part is in contact with the Main Server.

Disclaimer: I dont know

Blockchains are highly inefficient for decentralized consensus as well.

But they are the most efficient known solution to the problem. Efficiency is relative.

No, they are the most efficient known solution to global consensus for double-spend. There are alternatives that relax the constraints using extra information such as connections in the network to get a relatively good approximation of the global consensus. See Safecoin, for example.

Are blockchains inefficient if you’re not using proof of work? I thought it was the latter that was a source of inefficiency, and you don’t need PoW on a permissioned network.

If you're not using proof of work, blockchains start to look more like distributed storage with an audit trail and immutable row level db constraints

- if it's a Proof of Authority is like a way to deal with who has access to write to the db

- the distributed consensus part is well researched (Raft, Paxos etc)

The only advantage that I can think of is interoperability: you will be able to communicate with the public blockchain for point in time "backups". Also, building your internal smart contracts you can use an existing language like Solidity.

Even if you use some other consensus mechanism they're still inefficient. All full nodes in the network still have to propagate, validate and store all transactions forever.

This is indeed much more inefficient compared to a centralized solution and it's very difficult to create a decentralized network that can handle the amount of transactions that VISA processes for example.

I believe Riksbanken want it to be decentralised though. They don’t want to have to bother with Know-Your-Customer stuff. I believe they don’t want to have to store personal data. At the same time they don’t want it to be anonymous.

That’s why a solution where the commercial banks drive the chain, and keeps the KYC, allocating “anonymous” blockchain addresses, or accounts at the riksbank, has been proposed. The customers bank know the customer, the Riksbank does not. But the Riksbank, can still issue interest directly on the currency directly to the customer.

There are several ways that the nodes, or commercial banks, or whoever it might be, can make the whole think pseudo-anonymous for the customer. Would also let commercial banks offer services around it, making it easier to get the banks on board.

> Once you have a singular authority you can just let them decide

There are still a few benefits of crypto here:

- the “service” can stay up even when gov’t servers go down

- you can even make some transactions without network access at all

- transparency about money supply

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