Does a one-trick pony like blockchain deserve a Technology Forecast of its own?
Our Blockchain Conundrum
Our Blockchain Conundrum
By the TechCast Staff
For some time now, we at TechCast have been preparing a forecast of blockchain technology, the tamper-proof distributed ledger system—fancy bookkeeping, really—that lies behind Bitcoin and other so-called cryptocurrencies. We have put a lot of work into it. Yet, the better we understand blockchain, the less certain we are that a forecast is worth our time and our clients’ attention.
Two arguments for looking at blockchain are clear:
Next to AI, it’s probably tech’s hottest topic. For years now, we have seldom gone a day without reading of yet another company developing a novel use of this technology or an industry soon to be revolutionized by it.
That points us toward the second justification: blockchain’s apparent versatility. One recent article listed a dozen industries blockchain could streamline almost beyond recognition. Another listed 42 applications in a variety of industries and government services, many of which blockchain may soon change in important ways.
We are seeing some such uses already. Citi and Nasdaq have built a blockchain-based payment system for the private securities market. Deutsche Bank, HSBC, and IBM have successfully tested a blockchain platform for international transactions; 10 companies used it to conduct trades among five countries. The UK Food Standards Agency is using it to track inspection data from meatpackers. And in tech-forward Estonia, the national health system, courts, legislature, and security systems all have been running on blockchain since 2012. Surely anything with that breadth of impact merits its own Technology Forecast?
Perhaps not. Many of the tasks blockchain might take on have been handled well enough for years with relational databases and other familiar tools. Stick with the known, and there is no need for retraining, no need to debug new software, no risk of making new and bigger mistakes. You need good reasons to adopt blockchain. Otherwise, it’s not worth the trouble.
In fact, blockchains are uniquely helpful in only one class of activities, which we see in the examples above. They can be used to create enforceable transactions among multiple parties that either do not trust each other or are legally required not to operate on trust alone. Like a real-world contract, blockchains make sure that everyone is working with exactly the same data and guarantee that no one has ever tampered with it. So far, they are the only technology that can do that online.
This is why those long lists of industries blockchain might revolutionize quickly begin to sound repetitive. Blockchain might transform stock trading, car leasing, the sale or lease of intellectual property rights in music and entertainment, sports management, public records, and so endlessly on. In each case, blockchain does exactly the same thing—make online transactions verifiable and enforceable.
This is not to say that none of blockchain’s uses will be revolutionary. A blockchain-based voting system would finally allow us to hold elections online with no risk that hackers could change the results. If everyone can vote from their sofa or office chair, dismal election turnouts should be history. So would the need for recounts and any possibility of voter fraud. Anyone who truly believes in democracy should be pushing for the immediate adoption of a blockchain voting system.
But all this still leaves the question: Does a single-purpose technology like blockchain really merit its own Technology Forecast? And we still aren’t sure.
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