back to article It only took Oz govt transformation bods 6 months and $700k to report that blockchain ain't worth the effort

An Australian government agency given AU$700,000 (just shy of US$500,000 or £380,000) to research applications of the blockchain has delivered its answer: don't bother. Anything you want to do with blockchain, you can already do better with existing technology. For every use of blockchain that you would consider today, there …

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  1. Korev Silver badge
    Thumb Up

    An Australian government agency given AU$700,000 (just shy of US$500,000 or £380,000) to research applications of the blockchain has delivered its answer: don't bother. Anything you want to do with blockchain, you can already do better with existing technology.

    On the face of it, it sounds expensive... However, that 700kAUD is money well spent if it means that their techies can swiftly eliminate blockchain from various proposals by pointing at the report instead of letting the PHBs get fooled and waste a load of money in the process.

    1. TimR

      Agreed

      I wonder if Peter Alexander could be seconded to GDS for a while?

    2. Blank Reg

      You could probably add several 0's to the cost had the PHB decided to just go ahead and use blockchain everywhere because they had heard it was the latest thing so we must use it.

    3. Brian Miller

      Done it for cheap

      It's a one liner to auto reply for any "does blockchain fix this" email.

      "No."

      Done.

      1. GnuTzu Bronze badge

        Re: Done it for cheap

        Chuckle, chuckle. A hammer in search of a nail. I.E. Development done backwards.

    4. Anonymous Coward
      Anonymous Coward

      But...

      Wasn't blockchain supposed to be the answer to life, the universe and everything?

      I guess not then.

      As most of the world have not yet even heard about this particular ponzi scheme, then we might have escaped lightly but there are some people promting it like mad.

      https://cleantechnica.com/2018/10/23/power-ledgers-solar-solution-demystifies-blockchain-cryptocurrency-cleantechnica-interview-part-1/

      {there are more people in the so called 'green' world pushing blockchain in multi billion $ proposals}

      1. Ian Michael Gumby Silver badge
        Boffin

        @AC ... Re: But...

        Its not a ponzi scheme, its someone trying to re-invent the wheel while not really understanding the technology. There are two components, the actual blockchain, and then the distributed ledger.

        There is a niche where blockchain can make sense. but most of the examples touting blockchain are outside of the niche. Maybe this is one reason why IBM's stock is way down?

      2. herman Silver badge

        Re: But...

        "Wasn't blockchain supposed to be the answer to life, the universe and everything?" - No, you are thinking of 3-D Printing.

    5. paulf Silver badge
      Happy

      Lets get this right. A Government IT project was completed within 6 months, for less than seven figures and came up with a tangible result. I'll put that down as an unqualified success, especially when compared to the myriad multi-million multi-year failures.

      Bonus points that it actually debunked the latest buzz-word fad, and consigned it to the circular file.

      1. IceC0ld Bronze badge

        Lets get this right. A Government IT project was completed within 6 months, for less than seven figures and came up with a tangible result. I'll put that down as an unqualified success, especially when compared to the myriad multi-million multi-year failures.

        ===

        here's hoping they used a blockchain app in their process too

        1. Bronek Kozicki Silver badge

          Actually there is a use of blockchain. It is a distributed consensus algorithm (or, in other words, totally ordered broadcast protocol) which happens to be also resilient against Byzantine failures, unlike other consensus algorithms like Paxos, Raft etc. Of course, being a distributed consensus algorithm does not make it intrinsically valuable (as some "investors" would like you to believe), but it could be potentially useful to store and update a distributed database across a large number of untrusted devices (say, privately owned computers or mobile phones). Or it could be used to track a path of a physical thing in the supply chain (where individual suppliers cannot be trusted). It would be also rather inefficient and very laggy. Oh, and the whole "proof-of-work" is a total non-starter, unless you are into speculation with "instruments" which they are not.

          1. J. Cook Silver badge

            Actually there is a use of blockchain. It is a distributed consensus algorithm (or, in other words, totally ordered broadcast protocol) which happens to be also resilient against Byzantine failures, unlike other consensus algorithms like Paxos, Raft etc.

            Yes and agreed; however the report was largely shooting down "we put blockchain in [totally not appropriate usage]!" claims.

            It's a little expensive, but I still think it's a valid use of the funds.

          2. Ian Michael Gumby Silver badge
            Boffin

            Or it could be used to track a path of a physical thing in the supply chain (where individual suppliers cannot be trusted). It would be also rather inefficient and very laggy. Oh, and the whole "proof-of-work" is a total non-starter, unless you are into speculation with "instruments" which they are not.

            Uhm no... not really.

            Take farm goods. Are you going to place a sticker on every watermelon and then try to track it?

            If you said yes, then you have no clue about farming or watermelon growers. Then consider the fact that you may track the carton used, but that doesn't mean you couldn't have cross contamination along the way. There's more to this.. but blockchain doesn't help.

            1. Phil Kingston Silver badge

              Already happening. Wine being one use-case I've heard of.

              1. Jassop

                I also use wine by the case.

                Pardon? What are we talking about again?

          3. katrinab Silver badge

            For a government project, you probably don’t want distributed consensus. You probably want the government making the decision and communicating it to the people concerned.

            1. Bronek Kozicki Silver badge

              For a government project, you probably don’t want distributed consensus.

              Yes and no. Yes, because centralised solution (i.e. non-distributed) for most problems is what any government would naturally gravitate towards. No, because DARPA was a government project, with the explicit goal of creating distributed, highly available system.

              If a government wanted to build a distributed, highly available database for its citizens or for international community, then perhaps blockchain could be a part of the solution. Admittedly, that goes strongly against typical governmental thinking, so there you go.

            2. onefang Silver badge

              "For a government project, you probably don’t want distributed consensus."

              Voting in a democracy is a distributed consensus.

              1. katrinab Silver badge

                You have a Returning Officer who is officially responsible for the result.

                1. Anonymous Coward
                  Anonymous Coward

                  Wow, a comment and 20 replies with not a single downvote. This can't be right. Not on the register. I must do something to restore normality.

                  Brexit.

                  That ought to do it.

                  1. onefang Silver badge

                    "Wow, a comment and 20 replies with not a single downvote. This can't be right. Not on the register. I must do something to restore normality."

                    Sorry, I don't vote for ACs, since votes for them don't count. You are at 0 0 currently.

      2. Ian Michael Gumby Silver badge
        Trollface

        @paulf

        "Bonus points that it actually debunked the latest buzz-word fad, and consigned it to the circular file."

        Sure, but does the solution that you debunked use AI? Maybe that's why it failed. ;-)

  2. Stork Bronze badge

    Now we just hope

    That other governments will use this as starting point before they throw money away (on this at least).

  3. Def Silver badge

    In all fairness

    The Australian government isn't exactly the brightest example of forward looking, progressive thinking people.

    I'm not saying they're wrong here, but I honestly wouldn't take any advice they may have about future technologies at face value either.

    1. Eddy Ito Silver badge

      Re: In all fairness

      Alexander also didn't slam the door tight and merely implied it was insufficiently mature and at this time there are better tools for the respective jobs. At least that's how I took the comment of "blockchain is an interesting technology that would be well worth being observed, but... for every use... today, there is a better technology".

    2. Ian Michael Gumby Silver badge

      Re: In all fairness

      The Australian government isn't exactly the brightest example of forward looking, progressive thinking people.

      Is that because the sheep have revolted and are now buggering unsuspecting male farmers rather than the other way around? So the smart Aussie is always looking over his shoulder?

  4. Reader2435

    Just 'Unnecessary'? What about 'Wouldn't Work'?

    Bitcoin works because a) there are many copies of the blockchain around which can be compared to each other and b) it's intentionally very difficult to solve (or corrupt/replace) blocks.

    a) only happens because people are incentivised to maintain copies - because there is 'real' (potential) value in their Bitcoin holdings, recorded in that very blockchain.

    b) can only be made so difficult and yet folk still crack it because the miners accept that that is exactly where the 'value' (read rarity) of the mined Bitcoin appears from.

    In most of these other applications, neither a) nor b) would hold. So the whole darn thing quickly unravels like a chocolate teapot. I would be happy to be proved wrong if anyone can provide a detailed explanation so that I can finally understand how these other applications are supposed to work but as far as I can see, for *most* applications it is not only unnecessary but it wouldn't even provide the features that its proponents claim it can.

    1. Jim Mitchell

      Re: Just 'Unnecessary'? What about 'Wouldn't Work'?

      bitcoin != blockchain. You shouldn't base your opinion of blockchain solely on bitcoin.

      1. Reader2435

        Re: Just 'Unnecessary'? What about 'Wouldn't Work'?

        @Jim Mitchell

        Well, I guess that is another way of asking the same question I asked in my post - how *can* blockchain be gainfully used without the blockchain being the ledger for something of value (e.g. Bitcoin or any other cryptocurrency) which only has value due to the difficulty in extending the blockchain.

        In other words, can either exist without the other?

        Can the two be separated and still offer value?

        Of course a blockchain can *exist* without Bitcoin... like my wallet exists if I remove all its contents... the difference is that my money doesn't lose all value if removed from my wallet!!!

        I'm happy to accept that there may be some other application for blockchain other than currency that derives its value from the extension of the blockchain... I just haven't seen one yet that makes sense. Or would work. By 'work', I mean: deliver the features promised. Again, I would be genuinely happy to have one explained to me! Just one...

    2. phuzz Silver badge

      Re: Just 'Unnecessary'? What about 'Wouldn't Work'?

      I think the idea for something like a land registry, is that not only would the government hold a copy, but so would all the large property firms, maybe individual local councils too, etc. Then each can keep the others honest, and have a local copy for quicker lookups.

      I'm not saying it's a great solution just looking for a blockchain, just pointing out that in some circumstances your point a) is covered.

      As for point b) it's theoretically impossible to replace or corrupt a block (in the same way that cracking a suitably large encryption key is impossible, ie barring taking the length of the universe, or a massive breakthrough in quantum computing or something). I think the idea is that in a non-currency blockchain, that adding a new block will not be as difficult as it is for bitcoin, and will be done each time one of the participants adds a transaction.

      At the end of the day, it's still not something that can't be done with just a database and a little trust.

      1. Def Silver badge

        Re: Just 'Unnecessary'? What about 'Wouldn't Work'?

        I think the idea for something like a land registry, is that not only would the government hold a copy, but so would all the large property firms, maybe individual local councils too, etc. Then each can keep the others honest, and have a local copy for quicker lookups.

        You're missing the point here. In the land registry example, there would be multiple copies of the data, yes, and they would be publicly readable, but only the *owner* of an item in that registry, I.e., the land owner, or more likely - but not necessarily - his solicitor and/or proxy (or basically any named parties who have access to the encryption keys), would be able to reassign ownership to another party.

        That transaction could also be cryptographically connected to transfer of funds in the opposite direction, so it wouldn't be possible to perform one without the other. I think I'm right in saying this is what smart contracts are aiming to be in the Ethereum world.

        1. Persona

          Re: Just 'Unnecessary'? What about 'Wouldn't Work'?

          "You're missing the point here"

          The Land Registry would need to escrow a copy of the key so the title could be transferred if the holder had died taking the key with them, or to permit compulsory purchase. This makes using a blockchain utterly pointless …….. as is often the case.

    3. steven_t

      Re: Just 'Unnecessary'? What about 'Wouldn't Work'?

      The only thing about this I disagree with is the manner of the unravelling. Chocolate teapots tend to melt or, if dropped before use, shatter. I think it unravels more like a toilet roll in a tumble drier.

  5. trevorde

    A solution looking for a problem

    Blockchain has been around for over 10 years. If it hasn't found wider application by now, it probably never will.

    1. JohnFen Silver badge

      Re: A solution looking for a problem

      I don't know if I'd go that far. History is chock full of inventions that looked useless at the time, but became very useful much later than 10 years on.

      1. Pascal Monett Silver badge

        I believe that that is generally due to technology catching up with the idea. Da Vinci imagined the helicopter and it took centuries before technology could create the engine and the blades and the rest that was needed to actually make a usable version.

        As far as blockchain is concerned, it's software, so the tech is here now. So yeah, if no one has found a different use today, there's not much chance of finding a better use in a decade.

        1. Def Silver badge
          Facepalm

          ...it's software, so the tech is here now. So yeah, if no one has found a different use today, there's not much chance of finding a better use in a decade.

          So basically what you're saying is because software exists today, we shouldn't expect any more innovation from software in the future?

        2. Nano nano

          Who, not where ...

          I presume you mean Leonardo of that town .....

    2. katrinab Silver badge

      Re: A solution looking for a problem

      Blockchain (also known as Merkle Trees) has been around since 1979, making it almost as old as me.

  6. Teiwaz Silver badge

    £380,000?

    Bargain.

    I can easily imagine the UK gov would spend waste a lot more to eventually reach the same conclusion (which would be returned late and cost more than initially conceived).

    1. Chris G Silver badge

      Re: £380,000?

      In the UK that figure would probably only represent the cost of tea, biscuits and a couple of hours of consultation with someone who can explain blockchains in language fit for a primary school classroom.

      Several million more would be needed to arrive at an inconclusive result followed by a purchase that would never work properly in spite of a decade or two of money and 'consultants' being thrown at it.

  7. BoldMan

    This article reminded me that I haven't seen any reposts from The Conversation masquerading as articles on ElReg for a while - thank god!

  8. Aristotles slow and dimwitted horse Silver badge

    Oh no....

    But what about all of the snake oil salesmen? Won't anyone think of them and their gravy train...

    Seriously though, I'd pretty much reached the same conclusion on Blockchain.

  9. This post has been deleted by its author

    1. Anonymous Coward
      Anonymous Coward

      Re: Currency backed by the people

      Human beings aren't that special. There are billions of us, mostly made at home by unskilled labour. Fortunately no one is trying to make procreation reliant on a blockchain.

      1. Teiwaz Silver badge

        Re: Currency backed by the people

        Human beings aren't that special. There are billions of us, mostly made at home by unskilled labour. Fortunately no one is trying to make procreation reliant on a blockchain.

        Some officious numpty will want to tie the entire population into one at birth at some point, and even then ,there'll still be the inevitable same amount of paranoia and confusion over whether they think you should be allowed to live here or not, valid blockchain or no.

  10. Anonymous Coward
    Anonymous Coward

    link please

    Is there a recording or a written record of this ? my google-fu has not uncovered anything. It would be of much use.

  11. Phil Endecott Silver badge

    ‘Cannabis + Crypto.’ The two single HOTTEST Sectors of the Market right now

    Found by John Hempton, https://brontecapital.blogspot.com/2018/09/crypto-pot-stock.html :

    “On Feb 1, the company announced the Acquisition of a 49% Stake in CannaNUMUS Blockchain Inc. - developers of a cryptocurrency which will represent the performance of a suite of portfolio cannabis companies.

    “With a 49% equity stake in this blockchain platform, Abattis could see a significant upside from any CannaNUMUS liquidity event, including a reverse take-over of CannaNUMUS or an ICO,”

    “Yes, there are already Marijuana-based CryptoCurrencies. And while none are especially noteworthy, it's worth mentioning that CANN(CannabisCoin) has seen 20,000%+ GAINS and now boasts a $5.5 MIL Market Cap, POT (PotCoin) has seen 3,300%+ GAINS and enjoys a $35 MIL Market Cap, and THC (HempCoin) has seen a monsterous 114,000%+ Gain with a $28 MIL Market Cap!

    1. katrinab Silver badge

      Re: ‘Cannabis + Crypto.’ The two single HOTTEST Sectors of the Market right now

      So basically bearer shares, which are illegal in every country in the world except Scotland, and the specific implementation here looks like it wouod be illegal in Scotland as well.

  12. Destroy All Monsters Silver badge

    Our position today, and this is an early write-up, is that blockchain is an interesting technology that would be well worth being observed

    Like a famous cat, it is neither alive or dead until observation happens.

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