Are traditional technology companies embracing or creating blockchain bubbles

Entering this year, blockchain technology has undoubtedly become a hot spot in the industry. Even the industry has begun to discuss the subversion of blockchain technology for traditional technology companies, that is, traditional technology companies will embrace the blockchain as soon as possible, or be subverted. On the surface, some traditional technology companies (such as Microsoft, IBM, Amazon, Google, etc.) are indeed "hugging" blockchain, but the facts are far from being as real and simple as the industry sees.

Here, we may wish to briefly introduce the characteristics of the lower blockchain.

It mainly includes decentralization, transparency, security, and open consensus. Among them, decentralization means that the blockchain is composed of many nodes to form an end-to-end network, and there is no centralized equipment and management organization. Open and transparent means that all data information of the blockchain is also public, and each transaction is broadcasted to make all nodes visible. Safe and reliable means that the modification of the database by a single or even multiple nodes cannot affect the database of other nodes unless it can control more than 51% of the nodes to modify at the same time. Open consensus means that anyone can participate in the blockchain network, and each node can get a complete copy of the database. The nodes maintain a common blockchain through competitive computing based on a set of consensus mechanisms.

It can be said that these characteristics of the blockchain are almost in sharp contrast with the technology and business models of the current traditional technology companies, especially in the decentralization.

Mentioning embrace, Microsoft and IBM seem to be strong supporters of blockchain technology. For example, Microsoft opened blockchain-related services on its Azure platform in 2015 and officially opened it in 2016. BaaS (Blockchain-as-a-service) service; IBM's blockchain project began preparations as early as 2014 and 2015, and later launched the blockchain platform service.

Here, we may wish to take a look at IBM's main blockchain project, which has a certain reputation and influence in the industry.

At the end of 2015, IBM announced its participation in the Open Ledger Project, an open source blockchain project led by the Linux Foundation (now renamed the hyper-book "Hyperledger" project); at the end of 2017, IBM blockchain and technology partner Stellar .org and KlickEx Group work together to build a new “transnational payment solution”. The solution is IBM's first use of public blockchain technology for production to facilitate cross-border payments across multiple monetary systems.

According to coindesk, the solution was implemented using Stellar's blockchain. Stellar's digital currency stellar coin was created based on Ripple's technical code modifications, so it is also a payment network system. In the stellar payment network, users use stellar coins as the base currency; in January this year, Comcast Ventures, a venture capital arm of IBM and Comcast Corp., will become the largest startup investment fund to help companies use blockchain. supporter. IBM will provide support services for start-up companies invested by blockchain investment fund MState, which will provide funding.

In addition, IBM has a global network of 380,000 people, including a “small” team of 1,500 employees in dozens of offices working on blockchain technology, which has led many blockchain startup teams. Dwarfed. Most of these employees are working to expand IBM's proprietary blockchain platform, as well as the open source Hyperledger Fabric.

Looking at Microsoft, as early as 2015, Microsoft launched the "Azure Blockchain as a Service (BaaS)" program. The program introduces “blockchain” technology to Azure and provides BaaS services to financial industry customers using Azure Cloud Services, enabling them to quickly create private, public and hybrid “blockchain” environments; in 2016, Microsoft announced the launch A plan that Microsoft calls "an open, modular blockchain component" is driven by Azure.

This program is called Bletchley, which is "Create a blockchain enterprise ecosystem with Microsoft's own architecture." In August 2017, Microsoft introduced the Coco Blockchain Framework, an enterprise-class open source blockchain base platform. To build a confidential large-scale blockchain network that meets corporate standards.

In this regard, Mark Russinovich, chief technology officer of Microsoft Azure, said: "Coco brings another way to the book construction, providing enterprises with the scalability, distributed governance and more needed. High confidentiality without sacrificing the inherent security and immutability they expect."

I wonder if the industry has seen the above-mentioned major projects of IBM and Microsoft in the so-called blockchain. What we see is that these so-called blockchain projects are based on traditional centralized cloud computing (such as Microsoft's Azure) or a centralized open source platform (such as the IBM 1.0 open source platform developed by IBM).

In this regard, there are questions raised by the industry. For example, as an early member of the Linux Foundation's Hyperledger project, IBM's help in developing Fabric 1.0 is one of the three open source platforms for the underlying development of the blockchain in the world. In the large-scale commercialization, the Fabric 1.0 version cannot meet the demand, just a "hanging" The development platform of the blockchain name.

As for Microsoft, Azure, based on its centralization, not only violates the decentralization of blockchain technology itself. Based on the so-called blockchain application built on it, it is possible to get rid of the shadow of Azure centralization. Both Microsoft and IBM are trying to build a decentralized platform on their own centralized platforms (such as Microsoft's Coco Blockchain Framework and IBM's majority blockchain team to expand their proprietary blockchain platform), which is itself A paradox, even the suspicion of "hanging sheep head selling dog meat."

Compared to Microsoft and IBM, Amazon Cloud Services (AWS) takes a cautious approach. Despite the rumors that Amazon has partnered with related companies to blockchain technology, Amazon Cloud Services CEO Andy Iasi said at the company’s annual conference in Las Vegas earlier this year that Amazon AWS will not It is too likely to provide blockchain based services.

When it comes to the reason, Iasi's explanation is that Amazon has not seen many practical use cases of blockchains to prove that its scope of use is much wider than using distributed ledgers. Amazon does not build a technology because it is very trendy (unrealistic). It is more concerned with whether building this technology is the best solution to solve customer problems. The reality is that most of the customer cases that turn to blockchain technology can be solved with other technologies, and these technologies are already within the existing capabilities of AWS (this seems to prove the above-mentioned IBM and Microsoft blockchains from one side) The technology of "hanging the sheep to sell dog meat", that is, the traditional centralized cloud computing can solve the problem, we must install a blockchain name).

Here, people in the industry can't help but wonder why the centralized IBM, Microsoft and Amazon have different attitudes toward blockchain technology. In fact, as long as you look at the current cloud computing market, Amazon's AWS is far ahead of Microsoft's Azure and IBM. It's easy to understand that Amazon will not let the current centralized AWS be replaced by a decentralized blockchain. Microsoft and IBM hope to use the blockchain's gimmick to assign their own centralized cloud computing to narrow the gap with Amazon, although its essence is traditional centralized cloud computing.

As for Google, according to a recent investment report by market research firm CB Insights, corporate investment blockchain projects have reached record highs in the past 12 months, while Google’s parent company Alphabet is the second in the world. Large corporate investors, the blockchain companies they invested in include Ripple and the trading platform LedgerX, which are closely related to the encrypted digital currency. That is to say, Google’s action in the blockchain is still based on investment, however, The industry is still skeptical about this type of investor because they believe that the involvement of traditional technology companies may not lead to real innovation, and even the possibility of killing blockchain technology. After all, the core of Google's business support is also central.

It’s also a coincidence that when a centralized traditional technology company represented by IBM, Microsoft, Amazon, and Google refused to enter or enter the blockchain market, IBM recently conducted a 12854 event from 112 countries. Surveys involving top executives (such as CEOs and finance executives) show that large companies are the dominant players in the industry, not startups. According to the survey, in some industries, digital giants (such as Google, Apple, Facebook) are becoming more and more influential, and 72% believe that the most innovative and established companies are the dominant forces of “destruction”. IBM pointed out , found destroyers, swallowed destroyers, established companies become more and more savvy. IBM's survey is a good summary of the ultimate goal of the above-mentioned traditional technology companies entering the blockchain.

If the above is the objective impact of the traditional technology companies entering the blockchain market on the future development of blockchain technology, then the recent blockchain enterprises related to blockchain technology and the traditional enterprises adopt the block. The fact that chain technology occurs is subjectively influenced by the development of future blockchain technology.

For example, at the beginning of this year, an article by the BitMEX research team entitled "The Ripple story" stated that from a technical point of view, Ripple (published by Ripple, a blockchain company) does not seem to have encryption like Bitcoin or Ethereum. The technical characteristics of the token. An important factor in its evaluation stems from the fact that the company's "distributed" (decentralized) consensus mechanism is an "unnecessary and meaningless smoke mirror" that is fully controlled by the Ripple server. In the eyes of BitMEX, this is the most shocking misleading that the Ripple team has driven.

As we all know, since 2014, Ripple has been explaining its “distributed” consensus mechanism. But from the pictures it publishes, this seems to be an iterative process - the server first makes a request, and if the legal conditions are met, the node will only accept those requests. Among them, the 80% threshold of the server is considered to be a critical level, and once this threshold is exceeded, the node will treat the request as terminated. While this picture describes some of the complexity of the whole process, in BitMEX's view, it can be summarized as -- barely revealing how Ripple's so-called "distributed" consensus mechanism actually works. At the same time, according to BitMEX's analysis of Ripple's outwardly disclosed transaction information and currency records, it was found that the early classification books of Ripple appeared to have lost 32,570 blocks, and the nodes could not repair and obtain the data. This also means that Ripple's entire blockchain and the full path of 100 billion Ripple coins will not be audited.

At the same time, in January of this year, the US veteran photographic equipment manufacturer Kodak announced that it has cooperated with Wenn Digital to release Kodakcoin to release its own bitcoin mining machine and currency program and KodakOne blockchain, but not long after The hedge fund company Kerrisdale Capital has released a 22-page report that shows that Kodak is on the verge of bankruptcy and that the blockchain program is only for the better sale of company stocks (after claiming its own blockchain, Kodak The stock price has tripled).

According to Kerrisdale Capital, Kodak's blockchain and encrypted digital currency plans are just hot and not reliable. At the same time, blockchain and database experts, lawyers, and founders of digital content organizations are skeptical about the Kodak blockchain project. The report also pointed out Kodak’s vulnerability in encrypting copyrights.

The first is to encrypt the image in the form of a blockchain, which does not better protect intellectual property. Although the head of the Kodak Blockchain Program has consistently emphasized that "blockchains can provide a permanent proof of ownership," this does not apply in the field of graphics. Imagine a scene where these small change blockchains don't "know" if a photo is slightly adjusted for the following resolutions or contrasts; secondly, Kodak does not store all images in the blockchain, it takes up too much data. And reduce performance. Instead, a hash of the image will be stored in the blockchain, which means that the portal will need a separate system to store the actual image.

Blockchain experts say "the cost of deciphering blockchain books is high, the index is poor, and they don't have the advantage of modern database software." Popularly speaking, this is impractical, and every time someone needs more searches. As a result, you need to decrypt the entire Kodak blockchain. Instead, Kodak may use a fast database engine that may be partitioned (partitioned) localized and hosted in Amazon AWS.

I don't know what the industry thinks about these two examples. What we see is that both the blockchain enterprise itself and the traditional enterprise using blockchain technology have intentionally or unintentionally returned to centralization, such as Ripple's pseudo-distributed and Kodak's KodakOne blockchain because Cost and technology reasons ultimately depend on Amazon's AWS, a traditional centralized Ripple server.

This shows that the blockchain technology itself is quite immature; the second is that in some practical applications, the cost and technology are not guaranteed (relative to the centralization); finally, is the blockchain technology itself actually adopted and verified for The customer has basically no solution. Under such a reality, traditional technology companies, from the perspective of cooperation with blockchain enterprises (such as the above-mentioned IBM cooperation Stellar.org adopts Ripple's architecture), or its service customers, is undoubtedly a gimmick far greater than the essence.

thinking and business model of traditional technology enterprises.

In summary, we believe that in view of the fact that blockchain technology requires the support and participation of traditional technology companies, both in terms of capital and final technology promotion and implementation, due to the deep-rooted thinking and business model of traditional technology enterprises, The blockchain technology and the enterprise itself are extremely immature and the customer's return to the centralized mode in the application process. The so-called embrace of traditional technology companies is actually just like God. The final blockchain technology is likely to be centered in this. Assimilation, that is, centralization occurs in the name of blockchain, blockchain technology is notorious, and forms a real bubble.