This past Tuesday, we got to watch Senator Elizabeth Warren flay Wells Fargo CEO John Stumpf alive—which Twitter thoroughly enjoyed—and then Accenture announced a patent filing for a technique that allows for a blockchain to be edited—which Twitter was somewhat less enthused about.
Various fintech enthusiasts like Dave Birch, whose blog was just named one of the top ten fintech blogs to follow (along with BI as it turns out; woohoo!), tweeted and re-tweeted responses to the declaration with different versions of, in the words of self-professed fintech geek Simon Taylor: “Accenture—just stop. You’re making this worse. You got this wrong.”
Creating a “master key/back door,” as Accenture did in this case according to Taylor, leaves the technology open to hackers, for one thing, and there are probably other ways to engineer solutions for banking without going that route.
According to Taylor, while there are a couple of different theories floating around as to what blockchain actually is (like traditionalists who maintain it’s only for bitcoin and anything else is sacrilege), companies like Accenture who are “looking to change the bitcoin code base are doing the wrong thing.”
Taylor told BI,
The original bitcoin blockchain–OB blockchain, if you will, has two key factors: immutability, and decentralization, that make it work for bitcoin but may not be best suited for banks.
Accenture’s David Treat argues on Coindesk that when it comes to OB blockchain , it’s the immutability that’s hampering financial institutions who want to utilize it themselves: What about human error? Or personal information—if a bank processes a transaction for a client will that client’s information stay on the blockchain forever? What if we need to update data? How do we store all of our data? And what if someone commits fraud or does something illegal at the bank—that’s going to be there forever too, and no one wants to be the next Wells Fargo!
But according to Taylor,
What other bits? Well, says Taylor, it’s complicated.
But however messy these questions–what actually is blockchain, how can we use it for banking, etc–are, no one really seems to think that Accenture is going about answering them the right way.
So, to answer the question up above, is blockchain still blockchain if you can edit it?
Well, not the way Accenture is doing it.
To learn more about blockchain, join us at Bank Innovation Israel this November 1-3 in Tel Aviv. Learn more and register here.1 - Reader Likes This Post