Between tool and revolution, this technology begins to occupy a place in the world of startups.
The bar is very high. Since blockchain technology began to be known at the end of 2015, it has been frequently predicted that its impact would be similar to the Internet. They are big words, and in this time blockchain technology has been the victim of misunderstandings and inflated expectations. It is much more than the technology that sustains bitcoin, but at the same time it is not for everything or everyone. With the misunderstandings cleared up and the competencies ordered, the technologists most convinced of the benefits of blockchain hope that 2020 will be the year in which some of its applications become widespread.
But in what type of companies and operations is blockchain going to have the most impact in the short term? To answer that question, you must first review the main virtues of this technology.
Montse Guardia, general director of Alastria, an association of more than 500 companies and organizations that tries to promote the use of blockchain in the Spanish economy, is clear about which is the most important: “The magic of blockchaines that facilitates the exchange [of value or information] between peers without the need for trust between them ”. Through a mesh network, in which the transmission of information is perceived by all its participants at the same time, without hierarchies, the blockchain works as a digital certification machine that something has happened at a specific moment. If there are attempts to corrupt that chain of blocks, they do not go unnoticed: the members of the network (or more technically, its nodes) are constant witnesses of everything that happens in it. Born as the technological support of a revolutionary economic idea —the decentralized issuance of money, through a virtual currency, bitcoin—, blockchain began to develop in the financial field and there the largest investment in technology is concentrated. The American consultancy IDC Research predicted that global investment in this technology would grow by 88% in 2019, exceeding 2.6 billion dollars. More than 37.9% would correspond to the financial sector, including the world of insurance.
2020 will be the year this technology takes off.
“Banking and insurance are the natural sector of blockchain, but there are many more,” says Guardia. Another of the great virtues of this technology, the traceability of the transmission of information, makes it especially useful in logistics processes, in addition to avoiding fraud and counterfeiting. The chain of blocks serves to certify from the quality of shoes to the origin of an orange, in addition to shortening bureaucratic processes in which several parties intervene, such as paying for the repair of a car accident, explains Guardia.
By translating all these possibilities into business use cases, the general director of Alastria detects two large groups: “In general terms, large companies apply continuous innovation: they try to use this technology to improve their processes. And there are startups that apply a more groundbreaking vision, creating new models ”.
Among the latter, companies of all kinds sprout. Unison Rights, one of many startups recently born in Barcelona, is applying blockchain in copyright management, an activity in which traceability is essential. Another area that can benefit from blockchain is that of online games, where tokens – privately issued units of value – begin to be transacted through a chain of blocks.
Faced with these uses, which fit into the characteristics of blockchain, there is no shortage of people who denounce that many projects apply technology as a simple response to a business and media fad. “It is true that sometimes you work with blockchain when you have other technologies that perform the same function,” concedes Guardia, who asks for patience, convinced that the smoke will dissipate. “This is a complex technology and we still have a lot to explain. Furthermore, the use of blockchain requires a cultural change and also a regulatory adaptation ”, he concludes.
It seems clear that that many companies will be keeping an eye on evolving startups related to blockchain technology.
Learn more about some blockchain trends