Hello,

We noticed you're browsing in private or incognito mode.

To continue reading this article, please exit incognito mode or log in.

Not an Insider? Subscribe now for unlimited access to online articles.

Connectivity

Is an Editable Blockchain the Future of Finance?

Designed to make the technology more attractive to large banks, the change doesn’t seem to be welcomed by purists—but they may have to tolerate it.

Blockchain, the technology that underlies the cryptocurrency Bitcoin, has been celebrated as a way to change the way transactions of all kinds are made. But a suggestion to make an editable version of the technology is now dividing opinion.

The consultancy firm Accenture is patenting a system that would allow an administrator to make changes to information stored in a blockchain. In an interview with the Financial Times (paywall), Accenture’s global head of financial services, Richard Lumb, said that the development was about “adapting the blockchain to the corporate world” in order to “make it pragmatic and useful for the financial services sector.”

Accenture aims to create a so-called permissioned blockchain—an invitation-only implementation of the technology, and the one currently favored by banks. That’s in contrast to permissionless blockchains, such as Bitcoin, which rely on the fact that they can’t be edited as a means of providing an immutable record of transactions. Accenture insists that the feature would be used only in "extraordinary circumstances," so that troublesome errors could be undone.

Blockchain purists, however, seem unimpressed by the idea. Speaking to Reuters, Gary Nuttall of the consultancy Dislytics, said, “An editable blockchain is just a database. The whole thing about blockchain is that it’s immutable, so this just defeats the object.”

It seems unlikely, though, that records of edits would be cast aside. Financial institutions are legally bound to keep complete records of transactions, so even if it were only held privately for the sake of regulatory requirements, the information would probably persist in one form or other.

It’s not the first time that corporate organizations have decided to put their own spin on the idea of a blockchain. While many banks seem to find the technical features of Bitcoin alluring, for example, they’re also developing ways to work around many of its features—using private blockchains to make the system faster and better suited to handling different currencies, for one.

The news is perhaps a welcome reminder that technologies can, and should, be allowed to evolve. Tweaks to the fundamental nature of blockchain may rankle its earliest adopters—but they could also be be what is required for it to graduate from the preserve of nerds to a system used by the world’s banks.

(Read more: Financial Times, Reuters, “Banks Embrace Bitcoin’s Heart but Not Its Soul,” “Why Bitcoin Could Be Much More Than a Currency”)

Tech Obsessive?
Become an Insider to get the story behind the story — and before anyone else.

Subscribe today

Uh oh–you've read all of your free articles for this month.

Insider Premium
$179.95/yr US PRICE

More from Connectivity

What it means to be constantly connected with each other and vast sources of information.

Want more award-winning journalism? Subscribe and become an Insider.
  • Insider Premium {! insider.prices.premium !}*

    {! insider.display.menuOptionsLabel !}

    Our award winning magazine, unlimited access to our story archive, special discounts to MIT Technology Review Events, and exclusive content.

    See details+

    What's Included

    Bimonthly magazine delivery and unlimited 24/7 access to MIT Technology Review’s website

    The Download: our daily newsletter of what's important in technology and innovation

    Access to the magazine PDF archive—thousands of articles going back to 1899 at your fingertips

    Special discounts to select partner offerings

    Discount to MIT Technology Review events

    Ad-free web experience

    First Look: exclusive early access to important stories, before they’re available to anyone else

    Insider Conversations: listen in on in-depth calls between our editors and today’s thought leaders

  • Insider Plus {! insider.prices.plus !}* Best Value

    {! insider.display.menuOptionsLabel !}

    Everything included in Insider Basic, plus ad-free web experience, select discounts to partner offerings and MIT Technology Review events

    See details+

    What's Included

    Bimonthly magazine delivery and unlimited 24/7 access to MIT Technology Review’s website

    The Download: our daily newsletter of what's important in technology and innovation

    Access to the magazine PDF archive—thousands of articles going back to 1899 at your fingertips

    Special discounts to select partner offerings

    Discount to MIT Technology Review events

    Ad-free web experience

  • Insider Basic {! insider.prices.basic !}*

    {! insider.display.menuOptionsLabel !}

    Six issues of our award winning magazine and daily delivery of The Download, our newsletter of what’s important in technology and innovation.

    See details+

    What's Included

    Bimonthly magazine delivery and unlimited 24/7 access to MIT Technology Review’s website

    The Download: our daily newsletter of what's important in technology and innovation

/
You've read all of your free articles this month. This is your last free article this month. You've read of free articles this month. or  for unlimited online access.