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Because we should not fear the blockchain

The pace of change in modern society is facilitated by rapid advances in technology. One of the most recent technological phenomena to stimulate thinking about how to reorganize society is the blockchain: encrypted registration of transactions using technology based on distributed master books. The protagonists of blockchain support its implementation at all levels of society to increase transparency and decentralize power. However, the adoption of this type of technology has been low in light of its birth, in addition to the fear of change between modern organizational structures, both public and private. Those who consider blockchain additions are however cautious, but what should they fear?

The fear of change is evolutionary in humans, but further evolution is determined only by change itself.

Organizations fear change

The organization of the company moving from a system focused on man to machine-driven one means the automation of processes facilitated by technology. However, organizations are cautious in making hasty decisions to adopt the latest technological trends and then suffer when a new, more complete and advanced product hits the market, making their new integrated system obsolete.

Creating Standards

As such, organizations are cautious in adopting the blockchain due to the fact that there is currently no clear standard for the operation of different blockchains: in terms of transaction speed, latency, security, etc. Until such a benchmark is defined by the market as technology becomes proven, most activities will delay the integration of blockchains, if at all.

However, early adoption of a key technology gives organizations the advantage of the first mover that can then repay dividends. A Harvard Business Review study shows that resistance to change is the biggest obstacle to technology adoption in any area, with 34% citing legacy systems presenting themselves as an obstacle. However, the same study shows a strong correlation between the adoption of technology at an earlier stage and the improvement of business outcomes.

Misconceptions about the blockchain

The fact that the blockchain is misunderstood hampers its adoption, and many believe that the blockchain is in essence a cryptocurrency. However, cryptocurrency is based on blockchain and not vice versa. This misunderstanding has even reduced the blockchain to the technology of distributed accounting books and the synonymous use of terms.

The negative reputation that the cryptocurrency has acquired all over the world means that it has broken the sphere of the blockchain, hindering the adoption. The reality is very different: the blockchain-based systems do not require the emission of cryptocurrency.

  Why we should not fear the Blockchain

Blockchain as a business tool

Put simply in terms of business implementation, blockchain is a type of software that increases the efficiency of business processes. Decentralized technology, such as blockchain, which relies on a community of participants increases the performance of business processes due to a massive cost reduction of different organizations interacting with each other, as everyone can participate in a single data sharing ecosystem , which does not require verification by third parties. Because of this, compared to many traditional internal investments to improve process efficiency, a higher return can be expected.

Loss of control

Putting faith in a common system that forms a "trustless" environment means that organizations are forced to give up centralized control of their data, instead of trusting in a distributed book system that records cryptographically and chronologically.

Just as the fear of change is part of the human condition, so is the fear of losing control.

Decentralization involves greater transparency as a compromise for control. Greater transparency also means further process efficiency since records and transactions can easily be verified within an automated system.

Lack of a legal framework

Without clear regulatory oversight, organizations place less trust in a system by determining who is responsible for security for data breaches or loss of data to become problematic. Furthermore, the recent implementation of the GDPR of the EU requires personal data on EU citizens to be archived within the borders of the 28 Member States. These are two of the major legal problems that hinder the adoption of blockchain between the business community. However, we must not forget that blockchains can be public (without authorization – open to all) or private (authorized – open only to a defined group of individuals / organizations) and businesses have more use for private networks where they can be accessed to information from authorized counterparties.

One thing must be clear: the adoption of technology depends a lot on industry and the type of organization. For example, an & # 39; organization could use the blockchain to streamline internal processes during data validation. The countless opportunities that the blockchain offers organizations as a tool for further development with greater efficiency should not be ignored, never worry.

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