This is a fifth and final post that focuses on the disruptive potential, commercialisation and adoption of the key new technologies underpinning the Fourth Industrial Revolution.
Prior posts have considered the impact of the Internet of Things (IoT), Artificial Intelligence, Augmented Reality and 3D Printing, concurrent waves of adjacent technologies that are amplifying the scale of the transformative impact and the merging of our real and digital worlds.
What is Blockchain?
Blockchain is a foundational, distributed ledger technology that promises immutability, is revolutionising record keeping and enabling self-executing smart contracts. If immutability can be guaranteed, which is dependent on the control of superior computing power, then trust can move beyond personal connection and the auspices of institutions, paving the way for open and transparent transactions without the need for intermediaries.
In its infancy but developing rapidly, blockchain technology has the potential to be the foundation for a ‘second generation internet’, and intranets, with applications that drive new economic growth, similar to and as transformational as the TCP/IP backbone that underpins today’s internet economy.
Disruptive Potential of Blockchain
In a digital, globalised world, with all the concomitant concerns of authenticity, biosecurity and money laundering, blockchain technologies can enable rapid, cost effective identity management, asset tracking, compliance and certainty of transaction completion. Where the internet enabled low cost peer-to-peer exchange of information, blockchain enables low cost peer-to-peer exchange of value.
Providing horizontal coordination mechanisms, blockchain enables truly globalised markets for provisioning and consumption, driving to lowest possible cost, and removing redundancy in industry verticals. Fundamental issues of scalability will be addressed through new protocol layers, paving the way for creative destruction on an epic scale. In enabling the world’s producers and consumers to enter into trusted transactions at low cost, blockchain’s impact lies in creating greater shared value throughout societies.
Commercialisation of Blockchain
The most visible proof of concept for value exchange are cryptocurrencies such as Bitcoin and Ethereum that run on their respective, eponymous blockchains. Ethereum is distinguished by its ability to support smart contracts and has by far the larger developer community. Microsoft, Amazon, Google and IBM have all released cloud-based development platforms and offer blockchain as a service. And experimentation with ‘next layer’ protocols to unlock the promise of peer-to-peer value at speed and scale are underway. But whilst the ecosystem is growing rapidly, notably in financial services, adoption at transformative scale is years ahead.
Market Adoption of Blockchain
Without compelling applications and accessible user interfaces, use of the initial internet was largely confined to the founding scientific and academic institutions. It was next layer developments, such as email and web browsers, with clear value propositions for business and consumers alike, that saw the internet become an almost indispensable part of the everyday life. Blockchain may play out similarly.