Bitcoin analysis is an attractive prospect to explore further over the coming years, as it will help provide valuable insights as to how people are using the digital currency. Some people will hold Bitcoin as a long-term investment whereas others use it as a regular currency to pay for goods and services. Riders is a new service that seeks to link some form of credit rating to Bitcoin addresses by using blockchain analysis.
Also read: Coinbase Trading Below Average Bitcoin Price Creates Arbitrage Opportunitiy
Blockchain Analysis As A Reputation System
One of the things Bitcoin transactions seem to lack is a form of reputation system based on the information provided by the blockchain. Even though it is entirely possible to see a Bitcoin address’ history regarding sending and receiving funds, there is no indication how this money has been used. Not that that is a bad thing per se, but it would be helpful if this technology could be wielded to create a reputation system of some sorts.
The developer of Riders.io is working on a platform that will use blockchain analysis to create a credit rating system for Bitcoin users. Or to be more precise, Riders will act as a Bitcoin ranking engine by using blockchain analysis. Whether or not this platform will turn out to be the Standard & Poor’s of digital currency, remains to be seen, but it is an interesting concept for sure.
Since Bitcoin does not have “credit” in the traditional sense, it is impossible to create a credit rating system for the digital currency. But that does not mean there is no valuable big data to be extracted from the blockchain, as this public ledger can be quite helpful in established a financial reputation system of some sorts.
Keeping in mind how all Bitcoin transactions linked to a particular address are recorded on the blockchain in real-time, Riders want to use this data to deem parties “creditworthy”. When dealing with others in the Bitcoin world, it is hard to determine whether or not they are genuine. Riders might not be the perfect solution for this problem, but the platform creates an attractive option.
Rather than sifting through tons of transactions belonging to one address, Riders will provide users with all of the necessary information they need. The number of completed transactions, how long the address has been used for, and a ranking “score” are all linked to a particular Bitcoin address. All in all, this service wants to provide a way to determine whether or not the owner of that specific address is trustworthy [for as far as that can be determined].
Future goals for the Riders platform include using blockchain analysis for identifying address owners. Not by trying to find out a person’s real name or location, but rather exploring the ability to use blockchain analysis for discovering correlations between different Bitcoin addresses, and what they are used for primarily.
Source: Reddit
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