Why Blockchain Is Important to Businesses in 2020—Here's Why
Blockchain technology is evolving as businesses learn to leverage it. Here's why blockchain is important for business and the skills you need to stay on top of the trend.
Trust. We all need it, wherever we live and work—especially in our professional lives. Blockchain data is hard to violate or copy. It makes digital money easy to transfer and exchange, quickly and cheaply.
That’s why blockchain, in a world where data is increasingly monetized, is relevant to business. It’s an act of faith, digitized.
Unfortunately, there’s hype and talk of “revolution” around the tech. It pays to be clear-eyed about what it’s good for and where it’s less convincing. Blockchain is not a total cure-all. It has its limits.
Beware the blockchain evangelist.
Blockchain Fundamentals in 10 Seconds
First, let’s look at how blockchain is useful for business in 2020. Blockchain is often talked about in the same breath as Bitcoin—its vertiginous rise and fall—and other cryptos although blockchain is a technology that stretches way beyond crypto applications.
Blockchain is the underlying technology or ecosystem that digital currency Bitcoin sits atop, as do many other cryptocurrencies. Very simply, it’s a digital ledger sitting across multiple networked computers.
A digital ledger is controlled not by central managers or administrators—roles common to traditional banks, for example—but by the owners of the data. It is consensus-driven because the many thousands of computers on its network have to agree or verify any data entered. This data cannot be tampered with or edited.
Immutable, Invincible, and Private?
From government records to healthcare to financial data, trust is regulated and policed. We all want our own digital privacy to be safe (or safer). As blockchain tech is completely decentralized, its privacy advantages are significant.
But it is not invincible. Blockchain cannot tell if the data recorded is accurate. So it still relies on human judgment and input. And while the underlying technology is claimed to be safe, its data is still traceable.
So do you put your trust in humans? Or technology? Or both? Blockchain shifts the trust further from humans to technology. That is fine as long as the technology is trustworthy.
The Trust Factor
Many businesses do trust blockchain technology. At the end of 2019, tech research firm Gartner said blockchain was one of the “top 10 strategic technologies for 2020.” Better trust, more transparency, etc.
Sifting the evidence, Gartner divided the tech into three archetypes, all with distinct risks and opportunities. “Enterprises,” warned the consultancy, “can easily make missteps that will leave them out of position to capitalize fully on blockchain.”
This is how Gartner thinks blockchain solutions will evolve in the next five years:
- Blockchain-inspired solutions, which have surfaced since 2012, will continue to arrive but will tend to focus on existing technology and processes.
- Blockchain-complete solutions that capitalize on blockchain’s full potential will pick up speed around 2023.
- Blockchain-enhanced solutions that are likely to land around 2025 will pull in artificial technology and the internet of things (IoT), supported by greater decentralization and more smart contracts, which are “self-executing” contracts verified and enabled by digital protocol.
The Fit Factor
Businesses will need to scrutinize where they feel the technology fits within their operations, and there may be serious scalability issues. Some privacy legislation—think medical records and the healthcare industry, for example—is a poor fit with public access.
There’s also concern about how the technology sits with legal, accounting, and tax structures. How will governance standards need to change or adapt to blockchain’s practices? Intermediaries are sometimes necessary.
So business context is all.
Businesses Set to Plug Into Blockchain: 4 Examples
Think critical power plants, industrial energy supply chains, and risk to public health. Much of these industries remain vulnerable to cyber hacking due to legacy IT architecture. Hacking risk could be cut if blockchain is applied, thanks to cryptographic data verification.
A transparent, encrypted blockchain can track internet campaign auditing accurately. This has benefits for advertisers, helping them build more accurate customer profiles, in turn driving more targeted advertising and saving money. If you can verify ad spend more accurately through a supply chain, you can weed out where your ad spend is not delivering value.
Academic certification remains a largely manual process. ID management is not just about digital diplomas, degree verification, or weeding out fraud. It’s also about bespoke learning opportunities working, for example, alongside artificial intelligence (AI). Academic performance (or behavior such as sharing, writing, and discussing—even skill learning) could be rewarded via tokens. A token is essentially a crypto used for a specific purpose.
From deeds to lettings management and planning permissions, the property market is awash with paper. Blockchain smart contracts could speed up conveyancing and land registration. This presents opportunities around the rental of physical space. Think of the potential for much shorter-term commercial rental contracts. As data becomes more commoditized and easier to link together, these opportunities will become easier to identify.
Finance Takes the Lead in Blockchain Technology
For now, though, the financial industry, deeply enmeshed in the crosshairs of data analytics and AI, is taking a blockchain lead. Corporates like MasterCard, Intel, Bank of America, and IBM are making serious investments in blockchain applications in data storage and smart contracts.
In other words, blockchain has moved away from its cryptocurrency-supporting origins to be a durable digital business enabler in its own right. Forbes contributor Bernard Marr pointed out in January 2020 that blockchain and distributed ledger tech is in its infancy.
“Only a relatively small number of organisations,” he wrote, “have achieved a sufficient level of maturity in their digital operations that they are in a position to successfully leverage it.”
For 2020 and beyond, the value of blockchain has yet to be fully realized. Ready to learn about its next jump?
Preparing for the Future of Blockchain
The learning and education curve will be steep. Online courses tackling these areas that support your own professional discipline help—or help you move across to a new sector if a career pivot is needed.
EmergingEd, for example, offers blockchain toolkits where students have direct access to experienced practitioners deploying blockchain training skills. Students can download PIN (professional impact now) resources including ready-to-go methodologies, checklists, and tools.
The point is to be prepared as the next level of blockchain disruption emerges, bringing new opportunities for market power, privacy, and trust. If you want a truly grounded economic perspective on blockchain’s potential, then online training is cost-effective and rewarding.