Whether to implement Blockchain or not
Blockchain has created a considerable scepticism. Although it began with Bitcoin, corporations adopted it as the preferred brand for all kinds of cryptographically-databases, experimenting with new approaches. But how should companies move towards technology?
Nowadays, given the situation of the industry, the technology and its complication, the most advisable is to understand some facts:
- Blockchain can manage the smart contract, copyrighted works, digitisation of commercial or organisational registries.
- The tech is suitable for carrying out tests and pilots; start by defining the business challenge and opportunities.
- The business side of a company should lead any Blockchain incursion.
- Businesses must beware of the Return on Investment (ROI) before team up with the tech area to get going on a pilot.
- Decide when and how the organisation should walk into the Blockchain testing.
- Better to be monitor and participate, instead of being the first mover.
- Businesses should maintain their awareness of what’s going on; the industry is emerging, and there are filters still to work out.
- Reevaluate your approach, identified a real problem that seems suited to a Blockchain-based solution.
- When payment instructions jammed at an intermediary bank, it might be perfect for Blockchain tech.
Implications when implementing Blockchain:
- It increases transaction costs - By avoiding intermediation financial institutions can lead transaction to multiple parties easily without paying a commission. However, moving cash parity to a Blockchain frame means adding to the total transaction cost; the comprehension of the new system would also be slower than expected, and errors might be irreparable, possibly bringing about enormous losses.
- The need for a collective adoption mostly determined by a sufficient amount of parties using the same implementation of the tech. Otherwise, Blockchain workability is questionable.
- Blockchain-centred transactions can conclude when all parties fill in their corresponding ledgers; the process can take hours, creating uncertainty to participants.
- Immutability of its ledgers: once participants record a transaction, no one can change or delete it, blocking the correction of mistakes if any. It causes Blockchain to run out of regulations.
- As the stored-data is immutable, it is not viable to modify it; consequently, this may not always be an acceptable property. There are certain rights from users requiring the complete removal of their information; Blockchain makes it impossible.
- Data privacy refers to the property that Blockchain can provide, the confidentiality of transactions for all data stored on it.
- The capability of keeping transaction content private will help to reduce the risk of connecting it to the real user identity.
Thus, before you decide on Blockchain and go on breaking up your legacy systems, consider these executives’ reflections: What for is it suitable? How should my company be involved at this moment? Is it the time, or will I lose what I have? Giving the fact that Blockchain technology still has to overcome many obstacles before becoming mature, try first a simulation-Blockchain with virtual goods and possibilities an average-company might have.
Further comments: Rather than investing in Blockchain-related initiatives, the industry should focus on evaluating the various solutions that could address the issues needing answers; try several routes to understanding the complete strategies, priorities, and pain points before engaging in a Blockchain approach.
However, please do not get too relaxed with this approach and fall short to appreciate its power; take a step back to understand what this could represent for your company.
Dave Food