Blockchain technology represents possibly one of the stronger examples of wilful disruption seen since the advent of the internet. By enabling trust in a decentralized network, by making multi-party transactions easier and virtually free by cutting out the ‘platform middle-men’, Blockchain looks poised to disrupt the very business models that disrupted entire industries over the past decade. It is at its core, a distributed ledger technology, specifically one that’s permission-less, public and shared. It’s a network of systems representing an alternate model of trust where each system replicates a copy of the ledger and follows a consensus-based method to maintain an authoritative record of changes to the transactions on the shared ledger.
The key features that Blockchain enables in any transaction are:
Blockchain technology serves to resolve a specific type of issue relating to trust in transactions. It is not a panacea that unlocks value purely through its implementation alone. While it is potentially too important for business leaders to completely ignore, it is not yet mature enough to mandate big-bang investment for incumbent businesses to stay relevant or operate profitably. However, given its transformative promise, businesses looking to experiment on leveraging this technology need to look for the following key characteristics that make for a classic use-case.
Examples of the success of Blockchain implementations include the City of Zug in Switzerland where the local council have successfully launched digital ids for its residents, implemented on a Blockchain. Canada is currently testing a Blockchain based solution to providing transparency to the use of government grants to ease concerns around misappropriation. Similarly, property title insurance, contracts management, document authentication and other such use-cases continue to be implemented and tested in a variety of sectors whilst more ambitious applications of Blockchain technology continue to be researched and evangelised.
With the current levels of technology maturity, business leaders must look beyond the euphoria and assess with pragmatism whether using Blockchain is a sound business decision right now – even in circumstances where a well-defined use-case does exist.