Last year, 95% of companies across different industries were investing in blockchain tech projects. In 2019, those pilot projects are finally moving from the test stage to the end users. Goldman Sachs, a former vocal skeptic of the blockchain, has launched a crypto-investing product for their clients in the end of last year. Beyond investing and finance, major blockchain projects have been released in several other industries including cybersecurity, healthcare and agriculture.
Enterprises no longer question whether blockchain is even worth the attention, according to Sky Guo, CEO of Cypherium, a startup offering enterprise-ready blockchain solutions. On the contrary, Guo says they are now proactively seeking new ways of incorporating this technology in their legacy systems. Henri Arslanian, head of fintech and crypto department at PwC, said that 2018 ‘cleared the noise’ in the blockchain space, and 2019 will be the year when big players enter the crypto world. Indeed, in the first months of 2019, several major companies have signed off new partnerships with blockchain startups (ING Bank and R3); invested in blockchain projects (Nasdaq and Symbiont); and new consortium partnerships emerged (Wall Street Blockchain Alliance and R3).
Further in 2019, we should see more enterprise-level decentralized ledger technologies (DLTs) emerging on the market as the underpinnings for those a strong.
1. Ready-to-use software is now available from top vendors
“Unlike the open-source blockchain software, enterprise solutions come with better scaling mechanisms, security, privacy and additional protocol changes that make them more attractive to the private sector,” Guo said. “In our case, we have improved upon the existing Ethereum consensus mechanism to maximize decentralization and scalability, without sacrificing one for the other. This, in turn, allows to achieve higher transaction speed and smart contract execution time.”
The particular appeal of enterprise-grade DLT is that it also enables unprecedented collaboration opportunities not just within large organizations, but cross-company as well. Several of the largest world food suppliers including Nestle, Unilever, Walmart, Kroger and others, are working with IBM to create a global food tracing system on blockchain. The collaboration is a crucial factor here to reach complete visibility into the origins of potentially hazardous goods and rapidly trace the source of contamination. Guo said enterprise-grade solutions set unified standards for such collaboration, enabling faster adoption and better interoperability between companies, ultimately benefiting everyone in the industry.
2. Interoperability has significantly improved
Lack of connectivity mechanisms between different types of blockchain solutions was a major roadblock to wider adoption. But these days, tech companies are presenting new viables ways for establishing connections between different ledgers.
Ripple has released an Interledger – mid-ware arbitrary protocol that can “connect” different types of ledgers, both distributed and traditional centralized ones. Its main goal is to improve interoperability between financial institutions. The additional benefit is that Interledger allows users to store aggregate transaction data off a public blockchain by using a connector to transfer funds between private versions of the Ripple network.
“Customer data privacy remains a sore point for enterprises as they must constantly upgrade their systems to remain compliant with emerging regulations,” Guo said. “By leveraging blockchain businesses can actually reduce their data ownership. Customer information recorded on the distributed ledger doesn’t have to change hands when transactions are executed. Instead, users can simply grant permission for access to those records whenever needed. This, in turn, allows enterprises to remain compliant with less effort, and users can benefit from greater privacy and security.”
3. The overall improved understanding and sentiment around blockchain
Blockchain is no longer viewed as an abstract technology supporting crypto-currencies. Over a half (58%) of investors and 55% of consumers feel that blockchain are optimistic about the blockchain’s potential for money transfers. What’s more important though, is that customers’ perception of the blockchain is changing too. Per Deloitte survey, only 18% of respondents in the US consider blockchain to be just “a database for money” with little other applications outside the financial industry. For the majority, it’s a promising new technology capable to transform a multitude of business processes.
In fact, that’s how most businesses now view blockchain. According to the same survey, 74% of companies state that they already have a “compelling business case” for blockchain technology; 34% already initiated a blockchain deployment.
As the sector clears of opportunistic ICO projects and speculative use cases, Guo argues that enterprises are becoming the key market players. And as more successful projects emerge, legacy companies are feeling an increasing pressure to innovate as well. With ready-to-use software and a burgeoning ecosystem of blockchain consortiums joining the bandwagon has become easier than ever.
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