Bank of America Tech Chief Is Skeptical of Blockchain Even Though The Company Has the Most Patents For It (cnbc.com) 82
Bank of America tech and operations chief Cathy Bessant said she is bearish on blockchain, the technology underpinning cryptocurrencies. "I will be curious to see what the actual volume of usage is on the JPM Coin in a year," she said. Slashdot reader technocrattobe shares a report from CNBC: "What I am is open-minded," Bessant said recently in an interview at the bank's New York tower. "In my private scoreboard, in the closet, I am bearish." Bessant is wading into the debate about the blockchain, whose proponents have claimed will be as significant as the internet. A blockchain is an encrypted database that runs on multiple computers, potentially cutting out the need for centralized authorities like banks or governments to settle transactions between parties.
The technology got a boost from rival J.P. Morgan Chase, which revealed last month that it created the first cryptocurrency backed by a major U.S. bank to facilitate blockchain-related payments. But Bessant, who oversees 95,000 technology workers and was named the most powerful woman in banking last year, is a pragmatist. She started out at Bank of America in 1982 as a commercial banker, eventually rising to a series of top roles, including head of corporate banking and chief marketing officer. She has run the bank's global technology and operations division since 2010. Most of what she sees doesn't make sense for finance or significantly improve upon existing methods. She said it's a technology in search of a use case, rather than something designed specifically to solve existing problems. "I haven't seen one [use case] that even scales beyond an individual or a small set of transactions," Bessant said. "All of the big tech companies will come and say 'blockchain, blockchain, blockchain.' I say, 'Show me the use case. You bring me the use case and I'll try it.'" She added: "I want it to work. Spiritually, I want it to make us better, faster, cheaper, more transparent, more, you know, all of those things."
The report notes that Bank of America "has applied for or received 82 blockchain-related patents, more than any other financial firm, including payment companies Mastercard and PayPal."
The technology got a boost from rival J.P. Morgan Chase, which revealed last month that it created the first cryptocurrency backed by a major U.S. bank to facilitate blockchain-related payments. But Bessant, who oversees 95,000 technology workers and was named the most powerful woman in banking last year, is a pragmatist. She started out at Bank of America in 1982 as a commercial banker, eventually rising to a series of top roles, including head of corporate banking and chief marketing officer. She has run the bank's global technology and operations division since 2010. Most of what she sees doesn't make sense for finance or significantly improve upon existing methods. She said it's a technology in search of a use case, rather than something designed specifically to solve existing problems. "I haven't seen one [use case] that even scales beyond an individual or a small set of transactions," Bessant said. "All of the big tech companies will come and say 'blockchain, blockchain, blockchain.' I say, 'Show me the use case. You bring me the use case and I'll try it.'" She added: "I want it to work. Spiritually, I want it to make us better, faster, cheaper, more transparent, more, you know, all of those things."
The report notes that Bank of America "has applied for or received 82 blockchain-related patents, more than any other financial firm, including payment companies Mastercard and PayPal."
Re: We need to save all WindBournes lies (Score:1)
Bessant is an ass licking, publicity seeking, idiot.
Iâ(TM)ve met her, and she is a complete dipshit when it comes to understanding technology.
This is the same cow that went on Dancing with the Stars and made a fool out of herself. I would have fired her for that stunt. Brian Moynihan is her bastard boss, and he delights in having her front everything so he looks clean.
Re:the real beauty of crypto? (Score:5, Informative)
You don't get anonymity with blockchain currency unless you make significant efforts to hide who owns each wallet. This costs money in transaction fees (a lot of money, of you want it to effectively provide privacy), and is usually called money laundering in the non-blockchain world.
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Didn't know I was money laundering when I was paying my hairdresser.
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blockchain ins't anonymous. In fact, there are companies that exist for the sole purpose of finding out who did what and when.
The blockchain is too American (Score:4, Interesting)
The blockchain exudes technological determinism [wikipedia.org]. It's built on the assumption that changing society is done by changing its technologies.
We've been here before. The distributed nature of the internet was meant to create a more egalitarian society, in its image. The project failed, and birthed surveillance capitalism. Do you think the technologists learned their lesson? No, they double down and created a new technology that's even more distributed. Surely this time it will work!
All this neo-liberal American nonsense about needing a blockchain because institutions can't be trusted, people can't be trusted.. It's built on such a negative world view. The truth is it's just as important to be engaged in creating better democratic institutions.
We lost our faith in god in the enlightenment, we lost our faith in politics last century, and we lost our faith in the invisible hand of the economy in 2008. I understand technology may feel like the best place to place your hope for a better future. But in the long run, the only thing that ever truly creates a better society is investing in the people, and shared ideas that slosh around its cultural playground. What we need now from Silicon Valley is critical thinking and self reflection.
Unfortunately, if the blockchain shows us anything, it's that the Califonian Ideology [wikipedia.org] has become Californian Fundamentalism.
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The blockchain exudes technological determinism [wikipedia.org]. It's built on the assumption that changing society is done by changing its technologies.
We've been here before. The distributed nature of the internet was meant to create a more egalitarian society, in its image. The project failed, and birthed surveillance capitalism.
The internet also created a level playing field where large fortunes could be made and entire very disruptive (to the established capitalist elites) industries built up while the established capitalist elites were able to do a relatively little to use their money and connections to appropriate or squash those industries. The current Republican efforts to kill net neutrality and censor the internet are to a large degree an attempt by the 'old money' to gain control of this level playing field and cement thei
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Alternative hot take: The push for "net neutrality" is an effort by the new billionaires to use government to force their business partners into subsidizing the new billionaires' network traffic.
The greatest trick the devil ever pulled was getting the world to believe "don't be evil" was his rule.
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Google, and well every publicly funded company are not evil, but by definition they are their number on priority is to their shareholders, if would be unethical for them not to try to make as much money as LEGALLY possible. Think about it if you where a debt collector and just wrote off debts of people who you thought where truly in need your employer would have every right to be angry with you.
The governments role should be to state and enforce what is legal. The problem is that through lobbing and campaig
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Do you think the technologists learned their lesson? No, they double down and created a new technology that's even more distributed.
Criticizing Technologists on a platform created by and for technologists. You never had these free speech option before so instead of complaining about them, you could just say thanks.
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A small correction, but we lost our faith for a short time in the financial market's ability to self-regulate through self-interest. We also lost our faith in the idea that it'd work to allow failure to happen on the sort of scale that'd result in a market correction because 1929 showed us how that turned out. The result was, honestly, a very quick rebound. Nothing much was actually learned. The very new rules to try to correct yet another d
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Silicon Valley regards them as deplorable.
Not at all. We are a basket overflowing with money, can't spend it fast enough. Need more upgrades, right now!
Re:The blockchain is too American (Score:5, Insightful)
Every major change in society is predicated on technological advancement. Those who believe in religions and ideologies don't like this truth, because they would prefer that the belief virus that they serve receive all the credit, but human nature only changes on evolutionary time.
The charlatan above is no different. He's imparting an ideology onto (presumably failed) technology so he can sell his ideology as the alternative.
This is precisely what the adherents of the so-called "Californian ideology" believe the internet would enable. He's actually no different than they are, he just thinks we are all sloshing around the wrong ideas.
Technology doesn't know the motives of those who invented it, but it can be used by anyone, including the people you don't like. That's what really grinds the gears of these ideological crusaders, and what the early internet utopians should have understood before they started writing declarations of independence of cyberspace.
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The Internet has improved society in many ways, and 'surveillance capitalism' goes back decades prior to the internet.
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The distributed nature of the internet was meant to create a more egalitarian society, in its image. The project failed, and birthed surveillance capitalism.
Not quite, it simply provided a new tool for everyone and didn't alter basic human nature or the tendency of bureaucracies and organizations to grab power as they grow.
Despite the doomsayers, the entire world is living much better than before on virtually every imaginable measure.
Nearly 1.1 billion fewer people are living in extreme poverty than in 1990. In 2015, 736 million people lived on less than $1.90 a day, down from 1.85 billion in 1990.
https://www.worldbank.org/en/topic/poverty/overview
In fact, the "west" is living so good that our main issue now is mental health which is a result of a lack of any real existential threats to the individual. The internet helps (ec
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From the perspective of a banker, her arguments make perfect sense, and her attitude would serve her well in other roles where directing product development is important.
I'd hire her.
You don't have to think that banks are a good thing to admit that she's got the greybeard attitude.
A blockchain is an encrypted database (Score:2)
I though blockchain was a photographically signed database.
Apart from that, I completely agree with this.
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Obviously, I pretended to write cryptographically signed, damn autocorrector!
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A blockchain is an encrypted database that runs on multiple computers, potentially cutting out the need for centralized authorities
How could it possibly run on multiple decentralized computers, if those computers don't know what the data is in the database since it is encrypted? And if it is encrypted and everyone knows the encryption key then it is not encrypted it is encoded.
It is true that parts of the block chain can be encrypted, but nothing in block
"Encrypted Database" (Score:5, Informative)
Read to this point. Whoever wrote this article needs to do a little bit of research before pretending to know anything about blockchains.
The part that makes it "crypto" is the fact that cryptographic signatures are used. No encryption involved.
"Spiritually, I want it to make us better..." (Score:3)
Yep, she's a banker.
Bitcoin not Blockchain (Score:5, Informative)
Blockchain Causes Global Warming (Score:1)
Look at any of the mining sites and you'll see the only calculation made is the amount of energy consumed per coin mined. The big mining operations consume huge amounts of energy.
Fixed that for you (Score:2)
"Spiritually, I want it to make us better, faster, cheaper, more transparent, more, you know, none of those things."
There, fixed that for you.
Dear Cathy,
You can abolish the whole concept of usury today. As we speak. You know, charge a fee for actual work, like all real economic activity out there. That alone would instantly achieve all the goals you lied about. Oh, and if you want to be transparent, stop calling it "that what is in between" in latin.
Patents are likely cheap in this context. (Score:5, Insightful)
It's speculative behavior, not startup-that-believes-it-is-changing-the-world stuff; but making a modest investment because it has a low probability of a huge payoff is hardly irrational or unusual among people who can afford to lose the investment if the most probable outcome occurs; which likely covers BoA.
It's another gambling chip (Score:3)
A lot of successful people like to gamble and compete. They are risk takers, entrepreneurs and the like. Crypto's are another gambling chip, like a non-voting, non-dividend paying stock. From the "customer is always right" file, if people want another game to play, and there's profit in it, give them what they want. Perhaps some emergent properties of this market will appear which may be socially useful. Of course the opposite could occur too. Remains to be seen.
Doesn't really discredit the skepticism. (Score:5, Insightful)
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Patents are a useful way to prevent others from becoming successful with the technology. So, even if you don't use it yourself, you can prevent others from competing.
win-win!
Did the author not know how transactions work? (Score:2)
Banks and governments do not "settle transactions". Banks provide financial services like loans and storage. Governments provide and back currencies. Central banks manage money supply. Banks and governments work together to create central banks.
Banks and central banks together created the Automated Clea
Re:Did the author not know how transactions work? (Score:4, Interesting)
Right; this is what a lot of the bitcoin fanatics don't understand the fractional reserve component of banking is their real role in the economy. I am not saying banks don't generate revenues in various ways off transaction processing but that isn't the core business. I am sure they won't like that part of the pie taken from them and will find ways to leverage their existing market positions in the space to keep themselves there. \\
Which is another thing you bitcoin nerds to realize it IS GOING TO ZERO. Even if some blockchain based cryptocurrency does become as ubiquitous as the dollar its NOT going to be bitcoin. Don't let the fact the goldman and few others are playing in the space. They are there to make some money speculating off suckers perhaps if they can but its really about developing the methodologies and infrastructure to do blockchain trading in whatever the ultimate currency is. Bitcoin is a research EXPENSE in their view not a profit center.
So why is Btc doomed? Think for a second currency is only valuable in terms of what real property or services it will purchase. Banks hold at least the title to awful lot of real assets. Do you think think they are going to surrender those assets to purchase some new currency? Why would they do that; what possible motive would they have to make a bunch of internet speculators and handful of crypto experts super wealthy? None.. Not when they can simple hire some other smart people (plenty of those) for a fraction of the cost to build them their own currency; which they can back with their existing assets.
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" back currency"
hmmm... no, no it does not do that.
Chief Technology Officer (Score:1)
Has no technology background. Take your Business Admin defree and shive it up your ass.
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Biased stakeholder (Score:2)
Bank executive is bearish on technology that could make banks obsolete.
Film at 11.
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Blockchain will never make banks obsolete.
95,000 Technology Workers (Score:1)
Can anyone answer her question? (Score:3)
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Blockchain feels like there should be a better killer app. When reading the white papers I feel like there is some idea just out of reach.
I suspect someone smarter the me will come along and figure something else out. Then all of us will be like That's obvious!
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people have been thinking of that for over a decade but we have no compelling use case for it. if you want a bottlenecked architecture for cryptocurrency transaction database that makes the thing illiquid under high load it's perfect.
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Indeed, verifying provenance is about the only viable use case. There are additional variants beyond art,
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I often point out that a blockchain is WORM storage. Once data is written, it's there forever. In finance,