Will the blockchain train ever arrive?

empty-train-platform

Blockchain, the distributed ledger technology developed to support bitcoin, will revolutionize how enterprises across multiple industries increase the security, speed, and accuracy of financial and data transactions while reducing costs.

Or maybe not. For all the money being spent on blockchain development by organizations and investors — not to mention the blockchain-related jobs boom that many already see happening — there are signs that blockchain’s real value might not live up to its hype.

First, here are some international development professionals who identified 43 blockchain use cases through internet searches, with the intent of presenting a successful case at a Monitoring, Evaluation, Research and Learning (MERL) Technology conference.

Most of the use cases, the researchers wrote in a blog post, “were described with glowing claims like ‘operational costs… reduced up to 90%,’ or with the assurance of ‘accurate and secure data capture and storage.'” However…

We found no documentation or evidence of the results blockchain was purported to have achieved in these claims. We also did not find lessons learned or practical insights, as are available for other technologies in development.

It gets worse…

We fared no better when we reached out directly to several blockchain firms, via email, phone, and in person. Not one was willing to share data on program results, MERL processes, or adaptive management for potential scale-up.

“Despite all the hype about how blockchain will bring unheralded transparency to processes and operations in low-trust environments, the industry is itself opaque,” the researchers concluded. “From this, we determined the lack of evidence supporting value claims of blockchain in the international development space is a critical gap for potential adopters.”

Meanwhile, Forbes contributor Bernard Marr wonders whether the sharp decline in value of cryptocurrencies — blockchain’s initial playing field — and hints of scammery in the cryptocurrency world is diminishing interest in the digital ledger technology.

“While these issues bear little relationship with industrial blockchain concepts, which often use private blockchains, the large amount of negative press has undoubtedly led to organizations becoming more careful,” Marr writes.

Maybe the blockchain hype is just that — all hype. Or maybe the technology merely is entering what Gartner calls the “trough of disillusionment” — the period in a technology’s hype cycle that follows “peak of inflated expectations” and precedes the “slope of enlightenment,” in which “more instances of how the technology can benefit the enterprise start to crystallize and become more widely understood.”

Will the blockchain chain be derailed by unrealistic expectations and lack of provable success in the real world, or is it merely behind schedule but certain to arrive?

Comments

  1. Ron Walters says:

    The problem with most blockchain use case discussions is the persistent drift to monetary conceptualization. It’s not just bitcoin. If we think more abstractly, earned value can be obtained in managing a distributed CMDB in GRC use cases for InfoSec compliance in multiple supplier scenarios. IoT change controlled through issuing smart contracts is precisely what the industry yearns for and the hook to leading to a deep learning enterprise based in IoT technologies. Creating an purely immutable ecosystem, whether in a public or hybrid cloud, and proper assessments that determine if the RFC is in or out of scope of contractual MSAs mitigating enterprise risk and Data Governance requirements. No more heavily configured Expert Systems that require administrative movement from finite human resource capacity. Contact me if you offer any alternative solution to fulfill this need. I see this technology a a formative step to organize data schemes for future growth.

    Like

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