If someone has a use case they feel strongly about, I'd be interested in discussing it. I'd *like* to see a good application of block chains.
Here is an upcoming use-case for blockchain from a payment processor. Straight from the whitepaper https://cdn.omise.co/omg/whitepaper.pdf:
The primary role of blockchains are to solve coordination problems among multilateral
<snip>...</snip>
By shifting these business processes traditionally placed into a single corporation, it
is possible to provide eWallet providers an entire interchange process in a decentralized
high-performant open network.
I know I cut alot of stuff out of the quote... the point I'm want to look at here is the "high-performant open network"
Let's talk about performance. When I started studying BitCoin last week, I though "hey, another peer to peer network. i know how this works - add another node, the capacity goes up." Horizontal scalability, right?
But that's not quite how it works. When you add another node, the trust in the BitCoin network goes up with the capacity of the node, at least for some definition of trust. However, the capacity of the bitcoin network, in terms of transactions per second, actually goes down a bit. Every time someone creates a transaction, that transaction is delivered to every node in the network. Every time a new block is created, that block has to be delivered to every node on the network. So increasing the number of bit coin nodes actually *decreases* the aggregate capacity of the network, because it takes a little bit longer to handle these broadcasts.
This suggests that people who advocate using bitcoin on an internet scale just don't understand the mechanisms. Even though BitCoin is a p2p system, it doesn't scale the way BitTorrent does (for example).
I finally had time to get through the white paper, press releases, and peruse their website a bit. Not convinced this is a good example of a generally useful blockchain application, or that OMG solves a problem uniquely suited to blockchain. The "problem statement" in the white paper starts with a description of what blockchains can do and how this might be applied in certain situations. Starting with what technology can do rather than a strong focus on a problem is a huge red flag, not a good start.
Lacking clarity on the precise problem being addressed, the rest of paper meanders and is difficult to track (the entire time, asking myself, "but why?"). Also, the white paper and descriptions on their website struggle to communicate what exactly is being proposed and how it all works. It has the air of someone trying to impress using acronyms and dense terminology. As a software engineer/computer scientist I've read my share from Journal of the ACM and other academic journals - if someone cannot clearly explain something they probably don't really understand it. There are hints of this in the white paper, with hedging (we may do such and such) and areas that are yet to be defined (e.g. "It may be on our roadmap to allow for delegating validation to third-parties, whereby a limited amount can be slashed at a time before re-delegation is required (the exact mechanism is not yet specified for security modeling)") which gives the overall impression of being highly speculative.
One problem the paper touches on a bit is the unbanked, mostly in Asia, with discussion about difficulty of establishing credit history for credit cards. Yet it's a huge logical leap to assume that blockchain is the magicsauce for this specific problem. What a about cash cards, micro banking, pay by text....there are many viable solutions that don't require a Rube Goldbergesque distributed blockchain solution. In other words, what does blockchain uniquely address for this problem that nothing else can, or not as well? Not at all clear.
Also, odd that the organization's focus now seems to be "unbanking the banked" - e.g. a non-bank solution for those who already have banking. But again, for those who already have banking, what's the value proposition for this new platform?
Finally, they are making the
vast assumption that eWallets and payment platforms are difficult and/or fragmented only because integration requires "bespoke contracts" and/or because there is no incentive to cooperate with others. This is a partial explanation at best. Payment platforms are mostly difficult because there are tons of financial regulations, and these vary by locale. No sane legitimate business wants to violate these regs or they risk having their network being used for money laundering, fraud, funding terrorism or rogue states, and so on. The barriers to payment systems are largely legal rather than technical, and the legal safeguards are a good thing.
IMO, OMG appears to primarily be a blockchain solution to a cryptocurrency problem. Namely, why cryptocurrencies remain largely unused for commerce. I don't think it's going to be successful in addressing this. I do think they will create a system that handles lots of transactions, but my prediction is that it will primarily be used to exchange cryptocurrencies - essentially people speculating on relative cryptocurrency values.