Years on, the ferocious debate on blockchain’s rightful place in the enterprise ecosystem has not doused action on the ground. Mainstream participation has ramped up, particularly as Asia looks to muscle in on a developing space. From Japan-based messaging giant Line’s latest launch of a cryptocurrency exchange to a base of over 80 million users, to HTC Exodus 1, a blockchain-native smartphone developed by the Taiwanese consumer electronics leader, Asian powerhouses are staking a future in the potential and promise of the innovation.
Institutions, too, have begun to play a part in exploring the industrial viability of the technology. The Monetary Authority of Singapore, for one, has embarked on a collaborative project entitled Project Ubin which involves the participation of industry partners to examine the viability of Distributed Ledger Technology (DLT) for the clearance and settlement of payments and securities. The city-state’s financial authority also recently signed a Memorandum of Understanding with Hong Kong Monetary Authority to develop a cross-border infrastructure based on DLT.
Despite the initial excitement, enterprise interest in the space has been reined in by a cautious pragmatism. Over time, early adopters who have gained first-hand experience with the technology are now putting forth applications geared towards practical, day-to-day business uses cases.
Deloitte found that while at least 53 percent of surveyed organizations agree that blockchain has become a critical strategic priority, this optimism is weighted down by practical concerns. The result? An attitudinal shift that takes into account barriers to implementation, whether in replacing or adapting legacy systems, as well as a lack of in-house knowhow on the true extent of what blockchain can do for their companies. This seemingly objective approach is only the beginning of the next phase of blockchain adoption: one that navigates success not in the absence of challenges, but in spite of them.
A work in progress
With Gartner tracking blockchain’s progression past the peak of inflated expectations in the hype cycle of 2019, companies are measuring the utility of the technology the same as with any other investment. Critics who cast doubt over the value of blockchain beyond the boardroom gesture to the hampering speed of existing networks. Indeed, poor speed performance casts poor visibility over a future where blockchain is envisioned to power and support enterprise-grade solutions. Trailing behind legacy processors such as Visa, which operates at an average of 1,700 transactions per second (tps), Bitcoin, by far the reigning market leader, pales in comparison with 7 transactions processed per second. Encouragingly, however, blockchain solutions are evolving to provide enterprise clients with the option of choice.
As it is, downtime is not the sole criterion when it comes to transactions, and cryptocurrencies play to their strength when it comes to designing a more affordable payment rail. For example, Litecoin was able to conduct a transaction measuring over $99 million, with only $0.40 settled in related miner fees, a powerful argument against the relatively higher cut of transaction fees imposed by traditional payment systems. As enterprise deployment becomes underscored by a business-like practicality, blockchain is also morphing into a more purposed affair.
The level of involvement from enterprises is becoming more granular—companies need to ask not what blockchain can do—but what blockchain can do for them. To guide companies who have a burgeoning interest in the field but are impeded by a lack of experience and understanding, Singapore’s Infocomm Media Development Authority for instance, has introduced a Blockchain Challenge to encourage companies to explore blockchain-based business model innovations, with support offered through seed funding. For companies who are just beginning to dabble with the nascent technology, industry consortiums also provide much-needed structure and clarity on a starting journey.
Member organizations of Hyperledger, a global collaborative effort hosted by The Linux Foundation to catalyze open, industrial blockchain development, features industry leaders such as Accenture, J.P.Morgan, Deutsche Bank, and more. Designed by enterprises for enterprises, concerns are subsequently addressed in a more impactful manner, as in the example of IBM’s Hyperledger Fabric plug-and-play architecture which allows for companies to easily customize and evaluate blockchain for business use cases. Closer to the Lion City, Tribe Accelerator, Singapore’s first government supported blockchain accelerator, plays to the same tune, as it prompts directed and focused growth. Masterclasses hosted by industry experts, as well as a mentorship program, allow startups to efficiently navigate a rapidly moving ecosystem.
Blockchain is a business
While the technological work develops behind the scenes, enterprises eager to spread their wings may ascribe to the common fear of being a disruptor, or risk being disrupted. By doing so, companies whether in the form of legacy establishments or aspiring startups, are often tempted to append blockchain to the strategic blueprint as a symbolic nod towards digital transformation. And yet, however transformative it claims to be, blockchain as a technology is essentially an offering, one that enterprise players are becoming wiser to.
By nature, the roadmap of any business is a shifting and changing one, suited to the goals of the enterprise, adaptive to the nuances of the larger environment. With innovative technologies underwriting the enterprise landscape, it is only a matter of time before digital transformation becomes a matter of necessity. By setting realistic expectations on where they are headed—and indeed, where they want to be—the touted merits of blockchain can be put to the test, whether in terms of efficiency, security, cost savings, or more.
Despite the loud insistence on blockchain, almost akin to the identity badge for the 21st century business, there is no singular, model answer for companies looking to integrate the technology into their enterprise DNA. The blockchain blueprint––if there was ever such a thing––would be drawn up by companies who understand implementation as more than just an exercise of blockchain for blockchain’s sake. Instead, these companies possess the initiative to figure out how the technology, or even certain aspects of it, can be put to use. Smart contracts for supply chain companies; digital tokens for retail merchants; the possibilities are limited only by how industries can find compatibility with the technology.
As with any far reaching solution, the key to moulding the blockchain enterprise prototype is having that deep understanding of business, market, and technology, rather than an insistence on a one-size-fits-all approach. With companies already showing themselves to be eager beneficiaries to the ongoing thread of digital transformation, the day where blockchain can set up shop for enterprise customers is certainly closer than it appears.