Blockchain provides the ability to perform peer-to-peer, real-time, immutable and trusted transactions without the requirement of a third party. Cryptocurrencies – with Bitcoin as a trailblazer – have been the first and largest success of blockchain implementations so far.
Besides currency, many businesses have been considering, and implementing, blockchain-based solutions. Efforts around cross-border payments, trade finance, and supply chains have seen notable successes. The cost-benefit opportunities, along with the opportunity to generate new revenue, is now attracting all sectors, from banking to healthcare to food safety. The business case is not always obvious but the possibility of a more transparent, faster and cheaper transaction platforms drives significant investments and activities.
"While blockchain technology is still progressing at high speed and new opportunities are identified every day, key challenges are emerging as well"
The organizations that win on this front will not come from having the best technology or the best description of the blockchain benefits, but in differentiating from others from their ability to effectively deliver solutions.
From Shared Ledger Technology to Trust Economy
While CIOs and other IT veterans express doubts about cryptocurrencies’ future, very few question the value of blockchain and its potential.
The long-term impact of blockchain technologies will be dramatic in many ways. As a non-human trustee, blockchain will displace various players providing trust in transaction activities such as notarization, payments, exchange of value, transfer of data and contract execution, among other uses.
Private and public organizations, governments, central banks and communities are adopting blockchain with high hopes and many times with overblown expectations.
Hurdles to Overcome
Blockchain technology and how it can be used continues to evolve rapidly across the world. However, the technology itself is no longer the main challenge— many others beyond the programmers are critical in order to successfully implement successfully blockchain platforms.
Since blockchain is about the transfer of value, it requires multiple parties like business partners and competitors to interact. They must agree to use a single decentralized platform – which can prove to be hard – so creative incentive structures must be in place to generate adoption, build consortia and decide on effective governance and operating models. In addition, the regulatory and legal frameworks around the globe differ and are in development, which can slow down projects. Finally, the industry needs to grow a larger population of blockchain experts across skillsets, platforms and industries.
Blockchain cannot be ignored anymore. Many organizations are already building the future of transaction fabrics and in few years we will use blockchain the same way we use the internet today. We will not even notice...except for those who are not taking action today.