Blockchain was invented by Satoshi Nakamoto in 2008 as a public transaction register of bitcoin cryptocurrency. Blockchain has slowly gained traction in the company since its emergence 10 years ago. In fact, at the end of last year we saw digital workplaces using blockchain to share data and collaborate securely.
Blockchain in the mainstream
Some suggest that blockchain will become mainstream in 2019. Elizabeth White, CEO of White Company, a blockchain-based financial services technology company that manages an exchange / wallet service, an encryption and an encrypted debit card, agrees that while the 2019 be the year of mass adoption of the blockchain, it will only be for some key and impact use cases.
The reality, he said, is that most applications considered for blockchain simply do not need the distributed and untrusted register it offers and can run faster and better on traditional databases.
White cites the example of supply management or origin. For this case of use a blockchain is not necessary because there is a small group of users who need access to information and the most important aspect of such information is not transfer, (which is what the blockchain is useful) but rather input (which blockchain does not solve).
"There are certainly blockchain applications that deal with supply management in relation to trade finances," he said. "The main case of blockchain consists of reliable and automated payments, and by exploiting this technology we are building systems for B2B payments that can act as guarantee or conditional payment protocols".
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Blockchain still faces problems, especially in regulatory space. Braden Perry, lawyer for regulation and law enforcement at Kennyhertz Perry, a company that provides legal advice to companies on blockchain projects, has emphasized that blockchain in industry, like blockchain technology itself, is beginnings, but at the height of rapid expansion.
Companies that see the potential and are proactive in its adoption will likely be the first to advance in innovation and ahead of the curve when the benefits are fully realized. There is an opportunity for efficiency in terms of transparency and cost reduction, and some high profile applications are catching on. When the regulatory landscape evolves with technology, more companies will probably follow.
The biggest challenge for the adoption of blockchain, he said, is that regulatory treatment is unclear for many uses of blockchain technology and virtual currency. "It seems that every federal regulatory agency has dealt with blockchain issues, but no one has taken the initiative," he said.
For example, IRS has classified virtual currency as a property and the Commodity Futures Trading Commission (CFTC) has declared it to be a commodity. The SEC has implemented a securities structure that surrounds initial coin offerings (ICOs) and no agency has labeled virtual currency as a real currency. "This is true with blockchain – as long as the regulatory framework is not clear, many companies will hesitate to use technology to innovate their business processes," Perry added.
Companies that seek to innovate and are proactive in its uses will likely benefit in ways we can imagine, and in areas that are probably unimaginable. As the regulatory framework progresses with innovation, companies will benefit from it. But the regulatory framework will likely delay innovation and frustrate those willing to adopt new technologies.
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Blockchain simplifies the trade
Glenn Gow, a CEO and consultant for digital transformation strategies and blockchain, said that one of the drivers of the blockchain in the next year will be the simplification of trade through the use of "digital rights" or token blockchain.
Some activities, he said, are inherently difficult to negotiate and are not liquid. Other examples include precious metals, fine arts, agriculture and other goods. The current owners of these assets may want to raise funds, but it is very challenging.
Blockchain activities could change it. The way to remove costs, simplify tracking, speed up the process and increase the liquidity of the asset is to create a "digital right" to that asset (or part of that asset). A digital right is another word for a token. In this case, the owner of the waterfront property can create an "asset-backed token" that can now sell in a stock exchange.
"In 2019, we will see the proliferation of trading opportunities for assets that were previously difficult to negotiate," Gow said. "Using the blockchain, those who want to exchange resources will see their costs go down, increase transaction speeds, increase capital inflows and increase investment opportunities."
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The human element of Blockchain
However, not all the problems that businesses face with blockchain are technology-based. Alison McCauley, CEO of Unblocked Future, a consulting firm focused on the adoption of emerging technologies, said that while we are talking a lot about the technical challenges of blockchain, there is not enough about the human factor.
"Blockchain is a team sport: the biggest promise comes from use cases that extend through an ecosystem and deep into business processes," he said. "This means that people from different organizations have to work together in a way they are not used to doing. Organizations that might not trust each other could get great value by using a blockchain to collaborate. safely to a business process. "
But this kind of change is really, really difficult. People need to understand why they can trust technology to act as a proxy for trust. They need to change the way they work. And this kind of change takes time, especially at the corporate level.
Over time, as technical barriers fall, human barriers will come to the fore and gain more attention. In 2019, more organizations will understand that they need to dig into the human factor: how do you get parties with different perspectives to work together to get more value?