and how it's being used and what's next
Blockchain broadly refers to any distributed electronic ledger that uses software algorithms to record transactions with reliability and anonymity[i]. In a digital economy, there are clear attractions of a technology that enables transactions and interactions to be recorded securely and transparently in addition to being auditable, efficient and resistant to outages.
The technology chronologically records and links every piece of ‘information’ created across the network[ii], where the ‘information’ could represent transactions, contracts, assets, identities, or anything else that could be scribed in digital form. Use in the supply chain is therefore a natural fit; just 6 percent of relevant executives have full transparency of their entire supply chain, while 65 percent have limited visibility or none[iii].
Blockchain technology can be used beyond improving current processes, however. Deloitte suggests that ‘…like the Internet reinvented communication, blockchain may similarly disrupt transactions, contracts, and trust—the underpinnings of business, government, and society[iv].’ It has also been suggested that the potentially transformational impact of blockchain is ‘…like the early Internet. There’s an inability to know in advance all the uses it could be put to[v].’ What the net was and is to information, blockchain could be for notions of value. The business value-add of blockchain is forecast to reach $176bn by 2025, and then exceed $3.1Tn by 2030[vi]. Ultimately, there are very few industries that could not in some way utilise the blockchain, especially when one considers the twin emergence of data analytics and the IoT as these technologies could accentuate the possibilities of blockchain. Indeed, by 2019, 20 percent of all IoT deployments are forecast to have basic levels of blockchain services enabled[vii].
As with many technologies, the real change is strategic (and related to business and organisational models) rather than purely technological. Computer systems and networks must be agile enough to be able to scale up to handle ‘…an immense volume of transactions as industries and governments begin using the technology to handle their core organisational processes — and complete their tasks in seconds rather than minutes[viii].’ Building the skills, partnerships and models appropriate for harnessing blockchain will take time, but as ever, use cases are being tried and tested now. The best of blockchain may still yet lie in the future, but those wishing to harness it need to start their own exploration now.