Where are we with Blockchain? And is it living up to the hype?

What is Blockchain?

We hear the term consistently in the media and instantly relate it to Bitcoin.

Well, Blockchain is a technology that uses cryptography, peer-to-peer networks, and consensus algorithms to form a digital ledger of transactions. Ten years ago, Blockchain was combined with other technologies to create cryptocurrencies, and the first Blockchain-based cryptocurrency was Bitcoin.

Every participant in a Blockchain can view verified transactions, which are recorded in a chain of information. This built-in transparency allows Blockchain participants to conduct business transactions directly with each other, eliminating the need for trusted third parties.

How can Blockchain be used?

Businesses and smart cities can use vast repositories of live data and interactions guaranteed by Blockchain to automate routine tasks and execute business processes. For example, imagine that every property in a city had an entry on a Blockchain used as the council’s digital ledger. The data recorded in the register could reflect everything from property ownership to transactional data such as utility use, rates, ownership, building consents and sales data spread across a network.

Using Blockchain, organizations would have a verified, trustworthy way to perform transactions through digital platforms which would enable these organizations to perform end-to-end processes using integrated solutions, from the end-to-end digital principal. The digital principal would connect the organization with people, business networks, sensors, and Big Data, and manage prime operations.

Through a connected solution it would build on a simplified data model to combine business systems and processes with business intelligence able to engage with customers at all levels allowing for example, self-extracting contracts between buyers and sellers.

Recently ASB Bank claimed a first with a new Blockchain-based “single trade window” service used to organise a meat export trade deal for one of its customers, meat exporter ‘Greenlea’. The bank highlighted the fact that the Blockchain-based service  completed the digital payment and paperwork for the deal within an hour – compared to the two to four days it would have taken to process through more traditional means.

To circumvent the use of multiple software applications to collect and process information, organizations can use Blockchain to build inherently transparent systems that reduce the effort of authenticating documents, thereby eliminating redundant data collection processes. Furthermore integrating data across applications in compliance with data-sharing business rules, which can lead to an increase in employee efficiency, simplify IT landscapes, and deliver a higher level of data security for organizations and their partners.

A number of organizations have embraced Blockchain and according to a recent survey by CapGemini In survey 3% had large-scale use, 10% were piloting it, while 87% had only tested Blockchain proofs of concept.

It is by no means the next ‘coming’ and it will not solve all problems. If people try to tamper with that information, it becomes obvious, but as history has shown where new technology is pre-mainstream there is a tendency by organizations to want to apply it to every business area in every way imaginable. The possibilities are boundless and the surface has not even been scratched yet.

• There has been some interest from very large organizations to use the technology for example to develop a platform for food manufacture and shipping industry to track the status of goods and processes across the entire supply chain, providing a real-time visibility into the location and condition of goods, monitoring process milestones and automatically triggering actions where necessary.
• Large pharma looking to comply with drug serialization and reporting requirements to manage a secure supply chain, improve patient safety and to verify the authenticity of pharmaceutical products and combat counterfeits.
• Banking to improve finance and banking process, fight counterfeiting and illicit trade with the ability to add serialization into their processes and improve customer service and reduce paperwork for importers and exporters.
• International insurance organizations are pioneering the use of Blockchain to replace inefficient legacy systems, to break free from excessive government bureaucracy, and comply with U.S. and European data sharing regulations.

Chinese e-commerce retail giant Alibaba is using Blockchain with its subsidiary payment platform Alipay, while fellow e-commerce giant JD.com is selling Blockchain services to other organizations.

As with new, not yet understood technology, there is fervent scepticism about Blockchain, with some critics highlighting in particular that Blockchain is distributed, anonymous in nature and quite slow and with a large energy consumption making it difficult to scale up. It has also been pointed out that this peer-to-peer transfer system eliminates the middleman with nobody knowing where they will disappear to.

You don’t know what tomorrow will bring as the tech is still in its very early stages, but Blockchain has a lot of believers.

Some technology vendors are focusing on Blockchain as more than just the technology buzz, purporting to ensure their services are paramount in providing business value around impacted processes, data quality and integrity from the get-go.

Business leaders pursuing new digital initiatives must successfully embrace opportunities afforded by Blockchain technologies to support collaboration, e-commerce, and data sharing. Taking advantage of these new types of technology opportunities can assist business leaders to stay ahead of the innovation curve to meet their policy obligations, while better competing with other organizations.

A flexible digital technology platform that can meet changing business requirements can help businesses scale efficiently and cost-effectively and better serve their stakeholders.

Creating a future-proof technology infrastructure requires out-of-the -box thinking where integration supports collaboration across organizational silos to build out a digital strategy to include mobile apps, the cloud, Big Data, artificial intelligence and machine learning.

Integrating Blockchain into software applications may be a daunting prospect for some business leaders and organizations, but combining your organization’s digital integration with an active business network may be key to your Blockchain success.

There are organizations out there actively infusing Blockchain tools into their existing infrastructure. These new capabilities are said to be currently available from trusted software vendors around the world.