Blockchain for business – your questions answered
Last week, MWD Advisors presented a free webinar entitled Blockchain for your business – what does it mean, and what should you do about it? In it we covered the genesis of blockchain and distributed ledger technologies to highlight some of their key characteristics and issues; what different types of blockchains are good for, and applications they’re being put to across industries far wider than financial services; a look at what vendors are up to and the most important open source projects; and a summary of what we can learn from the earliest of adopters.
It’s a fast-moving space, and we weren’t able to cover all your questions in our live Q&A – so we decided to follow-up on some of the points here to keep the discussion going.
One thing we were asked about was what blockchain isn’t particularly good for.
In answer it’s worth remembering that, whilst a blockchain can serve as a database for recording transactions, it’s not a replacement for every type of database. It’s not without pain to set it up, and its distributed nature slows it down. So if your problem actually seems to be well enough suited to a centralised traditional database – one that operates under the control of a single authority; or you can run it perfectly well with replication or on multiple databases… then walk on by. Similarly, if all your business processing is happily taking place within the boundaries of a single organisation… then blockchain’s not for you.
We also had someone ask that, since there’s now so much focus on private permissioned blockchains, does this mean that there’s no future for public blockchains in business use cases any more.
To answer that, I’d say that business blockchains don’t follow a simple mantra like “private good; public bad”, it’s more nuanced than that. Not all business scenarios require the use of a private, permissioned blockchain. Some B2C or Government-to-Citizen relationships might map on well to a public blockchain because of the nature of the trust environment, for instance. However, if you do need a network that better maps onto real world B2B relationships in a members-only network… you’ll really be needing a private, permissioned blockchain which can be better tuned to fit, and which can leverage those real world relationships to its advantage.
Finally, it was pointed out that we didn’t cover every industry in our run-down of blockchain applications; asking whether this was because there’s nothing happening in those markets.
The answer is that, rather than there being nothing going on at all, it’s really more of a case that there’s nothing yet being done that’s particularly novel. That’s not to say there aren’t still instances of projects deploying some of blockchain’s common, cross-industry characteristics, etc.; and organisations seeing value in that.
For instance, many telco applications for blockchain have their roots in financial services use cases (such as the elimination of third-party intermediaries when charging across networks), or manufacturing (such as providing a platform for mobile IoT transactions to be recorded and micropayments made in respect of services). In retail, you’ve got some marketplaces that take cryptocurrency in payment for goods; and other examples where the use case tends to be linked to the customer-facing ends of manufacturing supply chains. Education use cases (such as combating CV fraud, or accrediting prior learning and experience) often mirror the scenarios found in government applications that take similar advantage of blockchain’s suitability for ‘digital identity’ or ‘access to data’ type projects, for instance.
But over time we expect that to change, as each industry fine tunes its ability to get value from blockchains, and in some scenarios whole business ecosystems could find themselves disrupted by players who aren’t even in the market yet.
You can find more information about the project types we’re using to categorise these cross-industry use cases, and a ‘tracker’ where we’re capturing the details of new blcokchain projects each week, on our interactive research tool.
Also, if you missed the webinar, you can easily access the replay using a free site account.
What’s more, in the coming weeks we’ll be publishing reports that delve into what blockchain is, and why you should care about it, in more detail; plus an overview of the vendor landscape. Watch this space!