Ripple Unveils Next-Generation System for Digital Transaction Consensus

Decentralized systems like digital currencies rely on consensus. This enables the network to agree that certain events – transactions, in the case of bitcoin – have taken place.
Miners are certainly needed to generate new bitcoins. Yet, their role is far more critical in confirming that bitcoins were actually sent from one place to another, thus maintaining an agreed-upon ‘truth’ in the network. This keeps the block chain reliable and, arguably, underpins its very existence.
However, maintaining consensus in a decentralized network isn’t simple. The risk of bad actors disrupting transactions or fabricating new ones is an old problem and the subject of much debate and study. Some, though, argue that the bitcoin network’s size and compensation mechanisms account for this possibility.

This post was published at Coin Desk on September 4, 2014.