{"id":2302,"date":"2020-03-05T03:58:32","date_gmt":"2020-03-05T03:58:32","guid":{"rendered":"http:\/\/kusuaks7\/?p=1907"},"modified":"2024-01-02T11:17:25","modified_gmt":"2024-01-02T11:17:25","slug":"is-blockchain-transitioning-to-a-more-mundane-and-useful-era","status":"publish","type":"post","link":"https:\/\/www.experfy.com\/blog\/fintech\/is-blockchain-transitioning-to-a-more-mundane-and-useful-era\/","title":{"rendered":"Is Blockchain Now Transitioning to a More Mundane and Useful Era?"},"content":{"rendered":"\t\t
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\n\t\t\t\t\t\t\t\t\tBlockchain<\/a>\u00a0was created around a decade ago as the public, distributed ledger for the\u00a0Bitcoin<\/a>\u00a0cryptocurrency.\u00a0\u00a0Most everyone agrees that it\u2019s a\u00a0truly brilliant<\/a>\u00a0architecture, built on decades-old fundamental research in cryptography, distributed data, distributed computing, game theory and other advanced technologies.\u00a0\u00a0When it first came to light, blockchain had no\u00a0broader goals<\/a>\u00a0beyond supporting Bitcoin.\u00a0\u00a0But, as was the case with the Internet and World Wide Web, blockchain soon transcended its original objectives.\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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\n\t\t\t\t\t\t\t\t\tIn 2016,\u00a0blockchain made the list<\/a>\u00a0of the\u00a0World Economic Forum<\/a>\u2019s\u00a0Top Ten Emerging Technologies<\/a>.\u00a0\u00a0The WEF\u00a0report<\/a>\u00a0compared blockchain to the Internet, noting that \u201cLike the Internet, the blockchain is an open, global infrastructure upon which other technologies and applications can be built.\u00a0\u00a0And like the Internet, it allows people to bypass traditional intermediaries in their dealings with each other, thereby lowering or even eliminating transaction costs.\u201d\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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\n\t\t\t\t\t\t\t\t\tThat\u00a0same year<\/a>, blockchain made its first appearance in Gartner\u2019s\u00a0yearly hype cycles<\/a>, where it\u2019s remained for the past three years.\u00a0\u00a0In 2017, Gartner\u00a0noted<\/a>\u00a0that \u201cblockchain<\/a>\u00a0might seem like it\u2019s just around the corner.\u00a0\u00a0However, most initiatives are still in alpha or beta stage\u2026 Long-term, Gartner believes this technology will lead to a reformation of whole industries.\u201d\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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\n\t\t\t\t\t\t\t\t\tIn a recent\u00a0article<\/a>\u00a0in the\u00a0MIT Technology Review<\/a>,\u00a0associate editor\u00a0Mike Orcutt<\/a>\u00a0succinctly summarized the current state of blockchain: \u201cIn 2017, blockchain technology was a revolution that was supposed to disrupt the global financial system.\u00a0\u00a0In 2018, it was a disappointment.\u00a0\u00a0In 2019, it will start to become mundane\u2026 After the Great Crypto Bull Run of 2017 and the monumental crash of 2018, blockchain technology won\u2019t make as much noise in 2019.\u00a0\u00a0But it will become more useful.\u201d\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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\n\t\t\t\t\t\t\t\t\tMost potentially transformative technologies go through the kind of\u00a0adoption cycles<\/a>\u00a0that Orcutt has (metaphorically) compressed into three years.\u00a0\u00a0Has there been too much hype surrounding blockchain?\u00a0\u00a0Absolutely.\u00a0\u00a0Quite a bit of that hype has now turned into disappointment, – perhaps outright disillusionment, – as people realize that blockchain is still in its\u00a0early phases<\/a>\u00a0of adoption, and\u00a0much remains to be done<\/a>\u00a0if it\u2019s to successfully transition from early adopters to mainstream markets.\u00a0\u00a0The key question is whether experts still believe that, over time, blockchain has the potential to become a truly transformative technology.\u00a0\u00a0And, with few exceptions,\u00a0the answer is positive<\/a>.\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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\n\t\t\t\t\t\t\t\t\tDecades ago, the great science fiction writer\u00a0Arthur C. Clarke<\/a>\u00a0famously\u00a0said<\/a>\u00a0that any sufficiently advanced technology is indistinguishable from magic<\/em>.\u00a0\u00a0I still remember the feeling of magic when the\u00a0Internet first took off<\/a>\u00a0in mainstream markets in the mid 1990s.\u00a0\u00a0People talked about the emergence of a whole new\u00a0Internet economy<\/em><\/a>.\u00a0\u00a0Clicks<\/em>\u00a0and\u00a0eyeballs<\/em>\u00a0would now replace old-fashioned business models based on revenue, profit and cash.\u00a0\u00a0Cities\u00a0would decline<\/a>, as people could now live, work and shop online from their more relaxing, affordable outer suburbs or small towns.\u00a0\u00a0As the\u00a0dot-com<\/a>\u00a0frenzy picked up intensity, all kinds of startups were brought to market, – some quite innovative and some rather silly, – many of which did not survive the\u00a0dot-com crash<\/a>.\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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\n\t\t\t\t\t\t\t\t\t\nA new\u00a0Internet-based digital economy<\/a>\u00a0has indeed emerged over the past couple of decades, but, as is generally the case, it\u2019s taken a lot more time and investments than originally anticipated, – as well as major additional innovations, such as smartphones, IoT, Big Data and cloud computing.\u00a0\u00a0A similar story can be told about electricity, the internal combustion engine, and now\u00a0artificial intelligence<\/a>.\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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\n\t\t\t\t\t\t\t\t\t\nWhat about blockchain?\u00a0\u00a0In his\u00a0article<\/a>, Orcutt offers three reasons why blockchain is ready to\u00a0leave the hype behind<\/a>\u00a0and transition to a more mundane and useful era.\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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\n\t\t\t\t\t\t\t\t\tPilots will go into production<\/em>.\u00a0\u00a0The article cites the example of\u00a0Walmart<\/a>, which is wrapping up a\u00a0two-year pilot project<\/a>\u00a0with IBM on the use of blockchain-based ledgers to manage the supply chain of food projects from farm to shelf.\u00a0\u00a0A few months ago Walmart announced that by September of 2019, all suppliers of leafy green vegetables to its Sam\u2019s and Walmart stores\u00a0are required<\/a>\u00a0to input detailed information about their food into a blockchain database, so it can better keep track of its massive distribution network for fresh produce.\u00a0\u00a0Over 100 Walmart farm suppliers are expected to participate.\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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\n\t\t\t\t\t\t\t\t\t\nTracking the source of produce is today a labor intensive, manual process.\u00a0\u00a0In an\u00a0experiment<\/a>\u00a0conducted by Walmart, it took its employees seven days to trace the source of sliced mangoes and locate the specific farm in Mexico where the fruit was grown.\u00a0\u00a0With blockchain, the source of the mangoes could be tracked in a matter of seconds.\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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\n\t\t\t\t\t\t\t\t\tThe new technology\u00a0will help Walmart<\/a>\u00a0\u201cpinpoint the sources of food-borne illnesses much faster than it can today, which could save lives as well as money.\u00a0\u00a0A recent\u00a0E. coli<\/em>\u00a0outbreak affecting romaine lettuce killed five people, according to the Centers for Disease Control, and forced Walmart to throw out every bag until it located the source.\u201d\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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\n\t\t\t\t\t\t\t\t\tThe article also mentions that two blockchain-based platforms will soon go into production to support the management and trading of digital assets.\u00a0\u00a0In August of 2018,\u00a0Intercontinental Exchange<\/a>, the parent company of the\u00a0New York Stock Exchange<\/a>,\u00a0announced<\/a>\u00a0its plans to create a new company\u00a0Bakkt<\/a>, to enable consumers and institutions to safely buy, sell, store and spend digital assets.\u00a0\u00a0And, a few months later,\u00a0Fidelity<\/a>\u00a0announced the creation of\u00a0Fidelity Digital Assets<\/a>, a full-service, enterprise-grade platform for storing, trading, and servicing digital assets.\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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\n\t\t\t\t\t\t\t\t\tReal-world smart contract applications.\u00a0\u00a0<\/em>Beyond the management of distributed ledgers and digital assets, blockchain platforms are being designed to support distributed applications based on the concept of\u00a0smart contracts,<\/a>\u00a0that is, programs that are automatically executed when a set of pre-specified conditions are met.\u00a0\u00a0Once agreed upon and stored in a blockchain, smart contracts are irreversible, and are intended to digitally guarantee the enforcement of a contract between two or more parties, thus reducing the need for intermediaries.\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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\n\t\t\t\t\t\t\t\t\tBut, as Orcutt points out in a\u00a0second recent article<\/a>, \u201cbefore smart contracts can do anything really useful, they need a reliable way to connect with events in the real world.\u201d\u00a0\u00a0For example, a flight insurance policy that automatically pays out if a flight gets canceled is an example of a simple smart contract application.\u00a0\u00a0However, such an automated flight insurance application requires a trustworthy source of flight data, otherwise hackers could feed it fraudulent data and claim payouts.\u00a0\u00a0This problem is now\u00a0being addressed<\/a>\u00a0by companies like\u00a0Chainlink<\/a>, a startup that\u2019s developed a tamper-proof system that securely feeds the necessary data to smart contracts on a blockchain.\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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\n\t\t\t\t\t\t\t\t\tLegal applications are another potentially important area for smart contracts.\u00a0\u00a0\u00a0A number of companies, such as\u00a0Open Law<\/a>, are looking to reduce the costs and frictions of creating and enforcing binding legal agreements by embodying all or parts of the agreement in a smart contract.\u00a0\u00a0\u00a0Established firms as well as startups are seriously exploring how to incorporate smart contracts and other blockchain technologies into their core legal practices.\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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\n\t\t\t\t\t\t\t\t\tState-backed digital currencies.\u00a0\u00a0<\/em>Bitcoin<\/a>\u00a0began life as a kind of techno-anarchist project to empower and protect individuals who shared a deep distrust of governments and large companies.\u00a0\u00a0It aimed to create a universal currency and an alternative global financial system not subject to interference from governments or banks.\u00a0\u00a0Some of its strongest supporters hoped that, over time, Bitcoin would replace traditional fiat currencies and become\u00a0the\u00a0<\/em>world currency.\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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\n\t\t\t\t\t\t\t\t\tSo far, it hasn\u2019t quite worked out that way.\u00a0\u00a0But, a number of central banks are taking a serious look at embracing some of the technologies pioneered by Bitcoin and launching their own\u00a0national digital currencies<\/a>.\u00a0\u00a0There are a number of reasons for this trend, including the shrinking role of cash in our increasingly digital economy; the potential to reduce the costs of managing and replacing physical banknotes; better security, privacy, and consumer protection; and the ability to better reach the hundreds of millions around the world who don\u2019t have a bank account or access to financial services.\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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\n\t\t\t\t\t\t\t\t\tThis is, in many ways, \u201cthe opposite of the revolution the original cryptocurrency pioneers envisaged,\u201d notes Orcutt in conclusion.\u00a0\u00a0\u201cBut revolutions don\u2019t always unfold the way the revolutionaries had in mind.\u201d\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"

Like the Internet, the blockchain is an open, global infrastructure upon which other technologies and applications can be built.  And like the Internet, it allows people to bypass traditional intermediaries in their dealings with each other, thereby lowering or even eliminating transaction costs. In 2019, it will start to become mundane… After the Great Crypto Bull Run of 2017 and the monumental crash of 2018, blockchain technology won’t make as much noise in 2019.  But it will become more useful.<\/p>\n","protected":false},"author":612,"featured_media":3898,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"content-type":"","footnotes":""},"categories":[192],"tags":[98],"ppma_author":[3320],"class_list":["post-2302","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-fintech","tag-blockchain"],"authors":[{"term_id":3320,"user_id":612,"is_guest":0,"slug":"irving-wladawsky-berger","display_name":"Irving Wladawsky-Berger","avatar_url":"https:\/\/secure.gravatar.com\/avatar\/?s=96&d=mm&r=g","user_url":"","last_name":"Wladawsky-Berger","first_name":"Irving","job_title":"","description":"Irving Wladawsky-Berger, a Guest Columnist at WSJ CIO Journal, is Research Affiliate at MIT Sloan School of Management, Adjunct Professor at Imperial College, London, and Chairman Advisory Board at r4 Technologies."}],"_links":{"self":[{"href":"https:\/\/www.experfy.com\/blog\/wp-json\/wp\/v2\/posts\/2302","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.experfy.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.experfy.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.experfy.com\/blog\/wp-json\/wp\/v2\/users\/612"}],"replies":[{"embeddable":true,"href":"https:\/\/www.experfy.com\/blog\/wp-json\/wp\/v2\/comments?post=2302"}],"version-history":[{"count":5,"href":"https:\/\/www.experfy.com\/blog\/wp-json\/wp\/v2\/posts\/2302\/revisions"}],"predecessor-version":[{"id":35306,"href":"https:\/\/www.experfy.com\/blog\/wp-json\/wp\/v2\/posts\/2302\/revisions\/35306"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.experfy.com\/blog\/wp-json\/wp\/v2\/media\/3898"}],"wp:attachment":[{"href":"https:\/\/www.experfy.com\/blog\/wp-json\/wp\/v2\/media?parent=2302"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.experfy.com\/blog\/wp-json\/wp\/v2\/categories?post=2302"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.experfy.com\/blog\/wp-json\/wp\/v2\/tags?post=2302"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/www.experfy.com\/blog\/wp-json\/wp\/v2\/ppma_author?post=2302"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}