"financial innovation" entries
Andreas Antonopoulos urges the Canadian Senate to resist the temptation to centralize bitcoin.
Editor’s note: our O’Reilly Radar Summit: Bitcoin & the Blockchain will take place on January 27, 2015, at Fort Mason in San Francisco. Andreas Antonopoulos, Vitalik Buterin, Naval Ravikant, and Bill Janeway are but a few of the confirmed speakers for the event. Learn more about the event and reserve your ticket here.
We recently announced a Radar summit on present and future applications of cryptocurrencies and blockchain technologies. In a webcast presentation one of our program chairs, Kieren James-Lubin, observed that we’re very much in the early days of these technologies. He also noted that the technologies are complex enough that most users will rely on service providers (like wallets) to securely store, transfer, and receive cryptocurrencies.
As some of these service providers reach a certain scale, they will start coming under the scrutiny of regulators. Certain tenets are likely to remain: currencies require continuous liquidity and large financial institutions need access to the lender of last resort.
There are also cultural norms that take time to change. Take the example of notaries, whose services seem amenable to being replaced by blockchain technologies. Such a wholesale change would entail adjusting rules and norms across localities, which means going up against the lobbying efforts of established incumbents.
One way to sway regulators and skeptics is to point out that the decentralized nature of the (bitcoin) blockchain can unlock innovation in financial services and other industries. Mastering Bitcoin author Andreas Antonopoulos did a masterful job highlighting this in his recent testimony before the Canadian Senate:
“Traditional models for financial payment networks and banking rely on centralized control in order to provide security. The architecture of a traditional financial network is built around a central authority, such as a clearinghouse. As a result, security and authority have to be vested in that central actor. The resulting security model looks like a series of concentric circles with very limited access to the center and increasing access as we move farther away from the center. However, even the most outermost circle cannot afford open access.