Blockchain and Why It’s Not About the Technology

So you think a blockchain project is about technology? Think again

Photo by Hitesh Choudhary on Unsplash

The latest tech buzzword is Blockchain, (remember IoT, Big Data and all those earlier buzzwords?). By now, the concepts behind Blockchain – a shared, distributed ledger with cryptography – are well known.  The initial automatic association between Blockchain and cryptocurrencies such as Bitcoin have also subsided.  But there’s still plenty of confusion.

When should I use Blockchain?

Blockchain is not for everything and it’s rather worrying when companies want to implement Blockchain in case they miss the boat.  It’s fine if you’re doing a small pilot to learn and get feedback, but I’ve come across organisations that seem to want to force-fit the technology into their business. Bad sign.

The viability of a Blockchain project should be carefully vetted, because here’s the thing -  it’s not a technology thing, it’s a business thing – ie, what are you trying to solve or build that Blockchain plays a part?  If you have a bad or poorly thought through business proposition, Blockchain isn’t going to make it better, only more expensive, confusing and frustrating.  And if the project fails, it’s not Blockchain that’s failed, it’s the business proposition.

That seems to imply that technology should come in last, ie that it enables business, but it can also work the other way, because Blockchain now provides capabilities that didn’t exist before.  So the other way to approach this is bottom-up – what business proposition that was previously not possible is now doable thanks to this new way of doing things?  What new processes and ideas might spring up?

For the creative, this could be a magic carpet. Just think – the big organisations will have the resources to explore and implement the technology, but how about the SMEs who are drivers of the economy in many countries?  The 50 or 100 person manufacturing shop, the small trader, the crafts maker, the importer-exporter who doesn’t have the knowledge or resources to implement what could be a game-changer?

After all, which trader wouldn’t like to connect with their overseas counterparts, receive confirmation and make payments in minutes rather than wait days or weeks, going through intermediaries, not knowing for certain if a transaction is happening?  The game changer here is TRUST, of course.

And Blockchain engenders TRUST, if you do it properly.  Yes, and how about that SME?  Now, wouldn’t it be interesting if someone built a Blockchain trading platform to which small traders and SMEs could subscribe?