Update: This article has been updated to reflect Bloq does run and managed its own platform.
Amid the extreme hype of the ICO boom, many corners of the blockchain sector seemed convinced that enterprises would rush to embrace the technology. Blockchain was touted as the solution to any and all business problems, finding use cases across almost every industry sector.
Now, as the new decade dawns, it’s fair to say that distributed ledger technology has caught on in a few notable industry sectors. Supply chain and finance are two areas where the benefits of blockchain quickly became evident.
Walmart, Nestlé, and Unilever are all now using IBM’s Food Trust solution to track and trace products in their supply chain. In the financial sector, trading platforms, including the Australian Stock Exchange and the Hong Kong Stock Exchange, have leveraged Digital Asset’s distributed ledger solutions for faster trade settlement without compromising counterparty risk.
A Slow Pace of Change
Despite these achievements, the vast majority of use cases that were being discussed in 2017/2018 haven’t yet yielded the results they initially promised. Enterprise adoption has been slower than anticipated. However, the hype was always unrealistic when the pace of change in large corporations tends to be painfully slow. After all, it took around a decade for the internet to become embedded into modern corporate society.
However, perhaps the biggest challenge is that blockchain technology in its current state comes with several barriers to enterprise adoption.
Many of the barriers to adoption are intertwined. From an enterprise perspective, blockchain still doesn’t offer much in the way of “plug and play” solutions, so it’s difficult to use. There’s a shortage of developers, meaning experienced developers can demand premium salaries, which in turn pushes up the cost of implementing a blockchain solution.
Furthermore, many public blockchains still aren’t scalable. A platform must be able to accommodate the transaction speeds demanded by a modern enterprise, or it will be rejected as not fit for purpose. Data security is also another concern, as many public blockchains offer too much transparency for the comfort of the average CEO.
However, these barriers don’t mean that widespread enterprise adoption of blockchain is a lost hope. Technology moves quickly, and there are many companies and projects with solutions that help enterprises to overcome the challenges.
Big Tech Steps Up
Along with developing permissioned solutions for corporate implementation, many of the big tech firms have invested heavily in blockchain technology in other areas. IBM offers a Skills Gateway portal where would-be developers can access training and information about blockchain.
Many big tech firms are also collaborating with blockchain projects in various ways, helping them to build their profile and increase exposure. For example, Google published a blog post last year illustrating how Chainlink could be used to link a public blockchain such as Ethereum to its enterprise cloud data warehouse. The post gave an immediate boost to Chainlink, both in terms of visibility and token price.
Blockchain-as-a-service is another way of making the technology more accessible to enterprises. It enables companies to outsource the challenge of implementation, overcoming the need for in-house expertise and developers. Ardor’s solution, which it called Consensus-as-a-Service, is one example.
Ardor offers many of the benefits of a permissioned blockchain while remaining public, through the use of child chains. The parent chain is responsible for network security and processing, whereas the child chains have segregated duties for specific operational tasks. This reduces bloat on the blockchain, enabling higher throughput while maintaining data security.
Jelurida, the company that operates Ardor, has established several enterprise partnerships. One of the most notable is with Henkel, a German company managing several household brands with annual sales €20m ($22m.) Henkel engaged Jelurida to work with its IT and product team in understanding, approach, and implement blockchain solutions.
The effort is part of Henkel’s 2020+ digitalization strategy and underscores the kind of commitment that large enterprises are making to including blockchain in their digital transformation effort. Jelurida has been involved in blockchain since 2013, meaning Henkel can leverage this experience without needing to hire their own developers or build their own solutions.
Dragonchain, which originated from The Walt Disney Company, offers a similar service. The Dragonchain Foundation maintains access to the overall code base, which was open-sourced in 2016. However, the commercial enterprise offering blockchain-as-a-service is managed by Dragonchain Inc.
Dragonchain has been working to bring blockchain into several industries. For example, the company has partnered with YokImpex, which has an 80% share of the Singaporean textile recycling market. YokImpex is using Dragonchain’s blockchain-as-a-service and platform to bring traceability and transparency to textile recycling in a similar way to how many companies are using blockchains in their supply chain.
Bloq is another example. The company operates a subscription model so that enterprises can access its BloqEnterprise and BloqCloud solutions on-demand. It also offers a consultancy service called BloqThink, designed to help organizations set up and implement their blockchain strategy.
The company has its roots in Bitcoin, as it was founded by former Bitcoin core developer Jeff Garzik as just like both mentioned above it runs its own platform. Perhaps these credentials account for Bloq’s impressive client lineup, which includes PwC along with banking giants Barclays and Citigroup.
Multi-Party Financing Solutions
Even despite Ethereum’s ongoing scalability woes, ConsenSys has made significant strides in working with enterprises on Ethereum-based solutions. One of the best known is trade finance platform Komgo, which is a blockchain-based solution for the commodity trade ecosystem.
The global commodities sector involves complex, cross-border shipments of goods, which is traditionally highly paper-based. This makes it vulnerable to many issues, such as fraud, miscommunication, and payment delays.
Komgo leverages blockchains multi-party features to automate commodity transactions, eliminating paperwork and ensuring a single source of truth for all participants. The platform is backed by global industry players, including BNP Paribas and ING.
It’s thanks to initiatives like the ones listed here that enterprise blockchain adoption has continued to move forward, even despite the initial hype from the ICO boom dying down. Many of these developments happen behind the scenes, as the reality of implementation tends to be less headline-grabbing than the initial news.
However, now that the technology has started to develop and blockchain firms and projects continue to break down the barriers, enterprise adoption will start to become evident across more sectors and use cases, bringing the “internet of value” to its initial promise.
Featured image Source: Pixabay.