Blockchain as a buzzword has been picking up speed in the past year as one part of a firm’s overall digital transformation. But can it solve anything now?
Blockchain is taking hold in the corporate world, but are there enough use cases at this time to merit further investigation and implementation? JD.com, China’s largest retailer, recently announced it is launching a new blockchain technology platform for use by enterprise customers to build, host and use their own blockchain applications.
The platform, called JD Blockchain Open Platform, enables customers to create and adjust smart contracts on public and private enterprise clouds. The technology can help companies streamline operational procedures such as tracking and tracing the movement of goods and charity donations, authenticity certification, property assessment, transaction settlements, digital copyrights and enhance productivity.
But how widely is blockchain being adopted? Will there be demand for Blockchain as a Service? A recent survey of 1,000 companies by Deloitte confirms blockchain has moved behind the experimental stage. “Momentum is shifting from a focus on learning and exploring the potential of the technology to identifying and building practical business applications,” the survey’s authors observe.
The Deloitte survey shows that close to three-fourths, 74%, of executives report that their organizations see a compelling business case for the use of blockchain—and many of these companies are moving forward with the technology. About half of that number, 34%, say their company already has some blockchain system in production, while another 41 percent of respondents say they expect their organizations to deploy a blockchain application within the next 12 months. In addition, nearly 40% of respondents reported that their organization will invest $5 million or more in blockchain technology in the coming year.
How does one develop a use case for blockchain, to assess whether this is the right approach to a business challenge? Tom Davies of Cisco provides some guidance to help sort through the possibilities blockchain has to offer. “You can apply it to so many use cases that it’s tempting to do just that,” he says. “But if you pause and think a little a bit about your use case, more often than not, there’s decent tech out there that will serve you just as well if not better.”
The key factor in a blockchain decision is based on database requirements, Davies points out. “if you don’t need a database, you probably don’t need a blockchain,” he states. “If you don’t need a place to store a bunch of data, you won’t need a blockchain.”
If the project does require a database, “then next think about if you or your application are the only actors that are going to be writing to it. If you are the only actor, then again, you probably don’t need to use a blockchain. You’ll be better off with a standard database on the whole. And there are plenty of those out there to choose from. This is where the bulk of applications fall.”