What Is Enterprise Blockchain? A Hoax Or A Key For Future Growth?
Recently, the enterprise blockchain has been considered a transformative technology to business in the digital era. But the doubt emanates when it comes to the term “enterprise blockchain”. So what is enterprise blockchain? Does it work? And if there is any scenario for the future set to this technology? Let’s walk through these questions one by one.
What is enterprise blockchain?
More than 10 years after Satoshi Nakamoto first introduced the blockchain, when someone mentions blockchain, there are two ways to visualize it. The first one is “blockchain equals bitcoin or any kind of the cryptocurrency”. The second one is enterprise blockchain — the distributed ledger technology that can be used to radically change how a business operates. So why are the blockchain experts divided into 2 different opinions?
When Bitcoin first appeared, the technology behind it, blockchain, was mentioned together and it became so popular that most people associate blockchain with Bitcoin. But many tech gurus realized that they can utilize the technology and apply it to the daily business activities, bringing in the so-called enterprise blockchain.
Blockchain itself is a technology. A blockchain is a distributed ledger, storing blocks of data linearly in decentralized locations, eliminating a central authority or intermediaries. Data in each block is immutable and verified by a cryptographic signature called a hash. Enterprise blockchain refers to using blockchain as an underlying technology to deploy decentralized solutions for enterprises with immutability, security, transparency, and traceability.
Enterprise blockchain, according to some, is just a hoax. Is that true?
There are many misconceptions of blockchain, particularly “blockchain is trustless”. Contrary to popular belief that “trustless means trust is not needed”, the power of blockchain is decentralizing trust, not eliminating it. This allows people to control and decide what to do with their own data.
Blockchain is assumed to be able to solve any technical problems, evoking doubt and anger while it’s still immature. While it’s true that blockchain has great power when it comes to tackling many business issues, it still has certain limitations and it’s not a panacea for every problem that enterprises are currently facing.
Fortunately, many enterprise blockchain platforms that are constantly harnessing the advantages of blockchain. The big names include IBM, AWS, Microsoft Azure; the rising enterprise blockchain platforms include akaChain, r3 Corda, Stellar, Quorum, etc. Focusing on the great unknown potentials of blockchain, each platform has its own strength, tackling different perspectives of the enterprises across industries.
Even with some successful use cases, enterprise blockchain does work.
Existing solutions for enterprise blockchain. In which industry it will work?
By being a distributed, timestamp, and linear database, blockchain has gradually solved some big issues in many industries.
- Blockchain loyalty program in Marketing and Retail: Low customer retention and redemption rate could be the consequence of bulky rewards loyalty programs, where customers are hard to control multi types of points and find the proper rewards. By connecting different loyalty programs, blockchain loyalty programs allow companies to provide customers with more flexibility to choose and decide the way to use their points. Enhancing the loyalty program with blockchain is a good way to cut off costs, increase security to raise customer loyalty and repeat interactions, and open to new business opportunities.
- Finance and Banking: “Blockchain is a game-changer in the industry and no financial services firm can afford to ignore it.” said Anirban Bose, Global Head of Banking and Financial Services. Using blockchain allows banks to process payments more quickly and more accurately while reducing transaction processing costs and the requirement for exceptions. Automatic transactions are not only faster but also less prone to manual errors.
- Supply chain management: The trust in supply-chain management systems when using blockchain is forced by computer code rather than paper law. The point is blockchain does not force but encourages people to be truthful due to immutability. People can sophisticated input data, there is no way back. Once the violation is detected, they can not change the information, they will lose everything: their reputation, trust, their business, and face the punishment. Blockchain also reduces tons of paperwork in supply-chain management systems, reduces cost, and accelerates the process.
- Insurance: With blockchain, fraud and abuse are no longer the big troubles to insurers due to the automatic process of smart-contract. Besides, data is structured more efficiently to estimate insurance products and services, then insurers can consider providing more appropriate to customers.
- Human resources: This technology gives managers a chance to seek for more potential candidates with a clearer working history with less time and effort. Besides, it also can be used as a way to reward company staff by combining it with the loyalty program.
Forecast for the future scenario of enterprise blockchain
In general, blockchain is still just in its early stage, and there is a lot more to do to bring this technology to larger aspects of the business world.
According to a recent forecast about enterprise blockchain platform implementations by Gartner, “By 2025, the business value added by blockchain will grow to slightly more than $176 billion, then surge to exceed $3.1 trillion by 2030”. And “Product managers should prepare for rapid evolution, early obsolescence, a shifting competitive landscape, future consolidation of offerings and the potential failure of early-stage technologies/functionality in the blockchain platform market”, said Adrian Lee, senior research director at Gartner.
After years of observing and researching the market and through our blockchain solutions, our customers, akaChain is glad to affirm that enterprise blockchain is efficaciously working, especially in marketing, finance and banking, and supply chain.
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