This is what, at its core, state channels are. Imagine we wanted to play a game of Starcraft and have a smart contract that pays 1 ETH to the winner. It would be ridiculous for each participant to have to write on the main Ethereum network each time a Zergling was killed by a Zealot, or when a Command Center was upgraded to an Orbital Command. The gas cost (Ethereum gas, not Starcraft gas) and time for each transaction would be prohibitive.
Counterfeiting items is a $1.2 trillion global problem, according to Research and Markets 2018 Global Brand Counterfeiting Report. The rise of online commerce and third-party marketplace sellers have made the crime more prevalent in recent years. Blockchain technology can help consumers verify what they ordered online and what they receive in the mail is what they intended to purchase.
This segment is where we have seen the most rapid metamorphosis in the past year, mostly in financial services. These solutions are industry-specific, and they are based on private blockchain or ledger infrastructures. A caveat here is that some of these are not full blockchains. Rather, they are distributed ledgers, which are a subset of blockchain capabilities. And some don’t even include a consensus element, which takes the implementation another level down from distributed ledger tech.
@gendal I am discussing private chains with prospects, so my interest is not superficial and theoretical. I see the benefits for the organization in using the private chain as another form of internal database, with better security properties. It can also be used where a service bus product would be today, to facilitate integration, conformance, monitoring, audit. Private chain can also, via a two way peg, be connected to the main chain, achieving a form of public/private network divide that routers created for us in the early stages of the Internet development. Anything else on the benefits side that I missed?
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thank you for the clear explanation of this. so in essence, by locking bitcoins to a particular address we’ve created an asset (collateral). then on the other sidechain (marketplace) we get issued shares against the asset, which we can sell. anyone holding a share can then redeem it against the asset. I think that’s an analogy that finance types would get
The second option will be to use sidechains. Blockstream first announced side chain in 2014 and published its whitepaper (https://blockstream.com/sidechai...). I believe in the future, bitcoin will have its desired flexibility with its sidechains. The idea of the sidechain is you can innovate and design your solution freely in the sidechains. These sidechains are independent, if they are failed or hacked, they won't damage other chains. So damage will be limited within that chain, for that reason you can be less conservative. Otherwise you would be more risk averse, if you had 42.5 billion dollar market cap like Bitcoin.
“Amit Goel is the Founder & Chief Strategy & Innovation Officer for MEDICI. Amit’s vision is to build a strong FinTech market network that involves financial institutions, banks, startups, investors, analysts & other key stakeholders across the ecosystem – helping each one of them in a meaningful way by removing the asymmetry of information and providing a platform to engage & transact.\ \ Amit is passionate about bringing actionable FinTech-focused insights, innovative products & services for the FinTech ecosystem. Some of his work involves startup scores, bank scores/assessments, predictive viewpoints & other innovations that have helped MEDICI’s customers and the ecosystem. He has been named amongst the Top 100 FinTech thought leaders/influencers in the world & Top 10 in Asia multiple times by reputed agencies, consulting firms as well as financial institutions. Amit has built MEDICI (formerly LTP) as a new-age, tech-enabled advisory/research firm, which is now considered the #1 global research & innovation platform for FinTech in the world.\ \ Amit has been writing pioneering viewpoints on financial technology space that have been ahead of the curve since 2010. His data-driven predictions have helped the customers as well as the ecosystem. His past work experience includes a strong background in strategy & market analysis and advisory to clients (from big business houses to Fortune 500 firms) in payments, commerce, financial services & IT/technology. In the past, Amit had also founded a successful consulting & research practice called GrowthPraxis and has worked at Boston Analytics, Frost & Sullivan, and Daimler Chrysler in strategy & research.”
Nikolai Hampton pointed out in Computerworld that "There is also no need for a '51 percent' attack on a private blockchain, as the private blockchain (most likely) already controls 100 percent of all block creation resources. If you could attack or damage the blockchain creation tools on a private corporate server, you could effectively control 100 percent of their network and alter transactions however you wished."[9] This has a set of particularly profound adverse implications during a financial crisis or debt crisis like the financial crisis of 2007–08, where politically powerful actors may make decisions that favor some groups at the expense of others,[51][52] and "the bitcoin blockchain is protected by the massive group mining effort. It's unlikely that any private blockchain will try to protect records using gigawatts of computing power—it's time consuming and expensive."[9] He also said, "Within a private blockchain there is also no 'race'; there's no incentive to use more power or discover blocks faster than competitors. This means that many in-house blockchain solutions will be nothing more than cumbersome databases."[9]
Byzantine fault tolerance (BFT) is what keeps the blockchain fundamentally secure. For simplicity, let’s say there were 100 nodes in a blockchain network (there are currently about 10,500 full Bitcoin nodes in the world). What happens when one node wants to tamper with the latest block and say other Bitcoin users sent him a whole bunch of Bitcoin when they really didn’t?

This type of permissioned blockchain model offers the ability to leverage more than 30 years of technical literature to realize significant benefits. Digital identity in particular, is fundamental for most industry use cases, be it handling supply chain challenges, disrupting the financial industry, or facilitating security-rich patient/provider data exchanges in healthcare. Only the entities participating in a particular transaction will have knowledge and access to it — other entities will have no access to it. Permissioned blockchains also permit a couple of orders of magnitude greater scalability in terms of transactional throughput.

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