By now, almost everyone has heard of Bitcoin and blockchains. Mainstream news, investment platforms, Wall Street, and everyone else is talking about this technology as the most amazing discovery since the internet. Many have called a Bubble on the Crypto Coins and likened it to Tulip Mania, while others caution about the Dot Com Bubble and how this has the same look and feel of that. One thing is for certain: There will be some winners in the technology space, and some form of blockchain technology will live on, just like the dot com did. We all still use the internet and dot com companies as an everyday thing. Can we look at the past “dot com bust” and predict the future of blockchain, cryptos and the future of this technology?
The group of speakers consisted of Lawrence Lerner, (from Rchain), Ryan Strauss (Seattle University School of Law), John Utley (IBM), and Jagan Namani (Madrona Ventures). As the speakers presented, I had a few key questions that I wanted to learn about:
- What’s happening from a regulatory standpoint?
- How is funding done and what are fundamental differences in the blockchain industry that are driving this change?
- What makes a solid business model for blockchain businesses?
- Picks and Shovels vs. Industry solutions – Which drives adoption faster?
I was excited to hear about what IBM was doing in the space, especially because of my curiosity around Stellar Lumens and the IBM CryptoCoin. John Utley from IBM spoke about all of the various ways IBM Blockchain technologies are finding ways to deal with supply chain at Boeing as well as many other companies. On Tuesday, IBM announced it teamed up with the world’s largest container shipping company, A.P. Moller-Maersk, to provide a new platform for conducting global trade using blockchain technology. We tried to get John to share more about Stellar Lumens and some of the banking partnerships IBM has in the South Asia Pacific region, but unfortunately the event ran out of time to get the answer. Hopefully people following IBM will learn more on their next earnings calls.
From the question on what’s happening from a regulatory standpoint, I think there are some insights that were given, but we still are so early on in some of the technology that it’s mere speculation. This week, similar to January 2017 and 2016, the crypto market had another big rollercoaster ride. Fears that the Korean government are starting to regulate crypto currencies as well as China and Russia may have played into the large price drop in crypto currencies. Some of the discussion that did shed light on this is how some companies are now starting to look at smart contracts using blockchains. There’s still no legal established practices in the U.S. today for this, however, we may see some of these changes for blockchains establishing trust in legal frameworks.
One of the more interesting topics that came up during this event was the idea of digital voting using Blockchain. There is a whitepaper from Plymouth University that talks about how voting could be changed and much more secure using a blockchain.
Voter registration could be tied to unique cryptographic addresses for each voter and upon proof of identification and the voter registration QR code, voting could be done with a web browser or at any polling station. The possibility of having voting records on a public blockchain and no longer using paper ballots could be a great reduction in error, voter fraud, and attacks on the voting platform itself.
In the coming years we are going to see more adoption of blockchain technologies:
How can the automotive industry use blockchains?
Today, it’s conceivable that an automaker will be able to track the provenance of a part from inception to disposal. By using a blockchain, a unique ID for each and every part is created and recorded, along with immutable timestamps from the moment of creation. Crypto-enabled tags that speak directly to the blockchain can be embedded directly into the part to add another layer of authenticity protection. This cuts out huge costs to middle men logistical tracking.
Streamlining of the Supply Chain and Business Processes
Every industry from banking to manufacturing has the problem of a complex IT landscape. Whether the IT system complexity came from mergers of companies or through an organic growth of IT systems to meet the needs of business, every large multinational organization struggles to maintain and run IT systems that span the width of mainframe, C/S and cloud apps, different operating systems, and different programming languages.
Blockchain offers the opportunity to simplify. Because blockchains enforce a single source of truth, in real-time, the risk of two systems having conflicting information drastically reduces. Systems and people can act with more confidence, and faster, because they are accessing true and trustworthy data in that moment. Because there’s a single source of truth, there’s less of a need for auxiliary systems to reconcile errors and inconsistencies, offering the hope of reducing system complexity. Because system complexity is reduced, businesses can react faster to market demands to release a new product, provide value-added services or optimize operational efficiency in the supply chain. Blockchains bring simplicity and speed to complex and slow systems, while reducing the costs to run IT. CIOs, CTOs and CFOs should be able to make a strong case for cost efficiencies by implementing blockchain technologies.
Global retail giant Walmart hosted a presentation on its work with blockchain during an annual investor event. The company began working with IBM and Tsinghua University of Beijing last year to test blockchain-based supply chain applications, with a particular focus on China’s massive pork market. In follow-up statements, Walmart indicated it wanted to apply the tech to various areas – and more recently, CoinDesk reported the company is looking at blockchain as a tracking solution for unmanned delivery vehicles. Walmart explained that the technology has helped it reduced the time it takes to track food from days to minutes, enabling more effective response in the event that tainted products are discovered.
This will help enable precise and rapid recalls to preserve consumer trust in the food industry, while increasing traceability and transparency of the food system
In the coming years we are going to see more adoption of blockchain technologies and see the uses expand. While many are seeing crypto currencies as the next gold rush, will the blockchain itself become the next big technology gold rush? One thing is certain, blockchain is here to stay. As regulators and technologists work side by side, we will begin to see new ways that both the cryptocurrency world and the blockchain will form the future.
While we watch the adoption of these technologies, there’s a number of things we believe you might want to consider. Blockchain is not a magic bullet. Unlike the public blockchains, if you are integrating a blockchain into your business, it is a private blockchain. The enterprise owns the blockchain and is writing and verifying each transaction, as well as gives permissions to a limited community. In this model, it’s essentially almost the same as not having a blockchain and running a database. The second thing to consider is this can become a lot more complicated with compliance like GDPR, where users have the right to be forgotten. How would you purge all data from a distributed ledger should a user wish to be forgotten? With this said, blockchain technology has its advantages, but don’t let a hot trending buzzword become your go to solution for security.
To watch the full panel discussion, you can see the video here.