However, these uses of the block-chain system still suffer from many of the same problems as Bitcoin itself does: notably, the 51% attack (someone with more than half the CPU power of the network can take control of the block-chain); growing energy consumption as the block-chain grows larger; the eventual massive size of the block-chain in the years ahead being too large for consumer computers to store; etc. This is why I think alternative crypto-currencies are so interesting. Not so much the trivial ones like Litecoin and Dogecoin, but those that actually make significant improvements to the block-chain algorithm to try to fix these flaws, such as Peercoin (which supplements the proof-of-work system with a proof-of-stake to try to reduce energy consumption and solve the 51% problem).

Block-chains and Bitcoin Tuesday, December 24, 2013 @ 11:49am