Did we just read that Blockchain technology projects are going to be shelved from 2018? According to Global Data’s Thematic Research report, as organisations become aware of the cost and complexity of implementing blockchain solutions, the hype and hoopla surrounding Blockchain Technology will recede. The early stage projects will be done on traditional approaches or improvised in a way so as to reduce the dependence on Blockchain.
The report highlights that the tall expectations everyone has from Blockchain technology are based on weak perceptions and in the next two years, the truth will be demystified.
However, the report reinstates that Blockchain as a technology has got real value, hence the scope of this technology will become narrower but more application based.
In our previous post, we had discussed some of the roadblocks in the adoption of blockchain and this report nearly resonates our thoughts.
A very important point discussed in this project is that more than being an underlying transaction platform, Blockchain will derive benefits from its transformation, integration, and modernization. The major ‘use case” categories for Blockchain will be:
- Asset registries
- Financial services platforms
- Industrial platforms
The report further states that the companies which will take the advantages of Blockchain technology will be tech giants. These will be big software providers with an established eco-system. Some of the firms like IBM, Accenture, SAP, and Cognizant will combine their technical expertise and bring in strong synergies.
The point brought out by this report is just a reiteration. A few months back, Reuters also reported that many Blockchain projects launched by major financial institutions such as BNP Paribas, JP Morgan and DTCC group have been shelved, as the technology is going through a hype-meets-reality phase.
The factors contributing to this are budget, an inclination of industry participants, sponsorship, cultural fit, and competition from current technology.
There is still hope
However, not all have lost hope on Blockchain. Some of the big financial institutions are still bullish on this technology. SIX is working on a blockchain project with Nasdaq and Australia’s stock exchange ASX wherein a startup, Digital Asset Holdings (DA) will facilitate replacement of its registry, settlement and clearing system. This is one of the most ambitious Blockchain projects to receive a go ahead.
Conclusion: Only time will tell
Whether the hype surrounding Blockchain will fade away is hard to foretell. However, it is true that the implementation is not going to be all that smooth. Blockchain still suffers from huge scalability challenges. The technology is in its nascent stages and scalability will only be addressed a few years from now. There is confusion amongst organisations as to how much cost would go in the adoption of this technology, therefore it is difficult to calculate RoI too. Challenges are many but still, there are many experiments going on in this category. We are optimistic that organisations will be able to extract genuine value out of this technology and surmount the obstacles.