Help me understand, if the blockchain has 100% uptime, how would there be outages in the infrastructure? To take down a large blockchain, you'd have to take out the entire network, or basically the whole internet.
What errors would occur if all the rules for transfer of assets were encoded on-chain? Crypto is already moving hundreds of billions of dollars worth of tokens 24/7 every single day. There's no central bank entities or clearing houses. The collateral for loans is completely tracked on-chain and fully auditable on the ledger. Tell me why that's not superior.
Re outages, it is not about the blockchain itself necessarily, but all the services and systems that interface with it.
Errors occur because humans are humans and fat finger trade details.
That aside, as I mentioned in original comment, instantaneous settlement has other problems, e.g netting is important in managing liquidity.
And to your point about crypto managing billions of dollars of tokens - it's an absolutely trivial amount compared to what's moved in the markets every day. Blockchains are incredibly inefficient and transaction rates orders of magnitude lower than what'd be needed.
You may not be familiar with the layer 2 innovations in crypto enabled by zero knowledge proofs, but blockchains such as Ethereum are about to get several orders of magnitude more efficient. It will absolutely be able to accommodate these transactions in the not too distant future. I get the tech needs to mature and get to a battle tested point first, but blockchain based stock trading is inevitable.
There’s just a single database that ultimately registers trades and ownership. [1] It’s not a technical limitation that creates the “constraints”. That’s what the parent is trying to explain.
That leaves me with more questions than answers with regards to DTCC's role in the future of finance. To me, it looks like an archaic, centralized institution that was set up to solve a problem they had in the 1960s with paper securities transfers. Smart contracts didn't exist then, so they weren't even an option. This central clearinghouse concept is going the way of the paper ticker. It has no place in the long term future of finance.
Yes, and they could "technically" build a scalable instantaneous system with a usable API. What prevents any movement in that direction is the messy interconnected web around it. A blockchain isn't going to help with it even if it's a technologically superior solution (it may not be).
Unlike what a concerning number of crypto enthusiasts appear to believe, "sorry for your loss" is often not an acceptable response in the mainstream world of finance.
But just like most players in the space have magically discovered the need for KYC if they want any real mainstream adoption, I expect that they'll also spend the next few years discovering why chargebacks and fraud protection are a thing.
We know, the Fed will step in at any time to back stop the losses. Don't kid yourself into thinking that such a system is without systemic risks. There's a reason why the big wigs spend their time in Davos dreaming and scheming about The Great and Orderly Reset.
As for KYC, crypto is well aware of it. Any centralized exchange you deal with in US has it in place already.
As for fraud protection and chargebacks, that is really just an insurance problem. And that's got solutions in the works.
What errors would occur if all the rules for transfer of assets were encoded on-chain? Crypto is already moving hundreds of billions of dollars worth of tokens 24/7 every single day. There's no central bank entities or clearing houses. The collateral for loans is completely tracked on-chain and fully auditable on the ledger. Tell me why that's not superior.