Bitcoin: the beginning
My first observations on bitcoin as a payment system date back to 2011. My analysis was that I did not expect bitcoin to become a regular and solid retail payment mechanisms, due to the lack of governance and powerbase.
In a later analysis, in 2013 I explained that the ‘democratic’ nature of the bitcoin blockchain was not truly democratic. The bitcoin blockchain ecosystem had then already changed into a landscape where powerful players and miners determine the way forward, rather than empowered individual citizens.
Since then I shared my insights as to the workings and qualifications on bitcoin in Dutch sessions (Arminius (in 2013, vanaf minuut 34), the Bitcoin conference 2014, a Bitcoin Meetup (2014) and featured very briefly in my contribution to the documentary Ulterior States. For an overview of the development of my thoughts, and the blockchain world, I would suggest you to read my blogs, orderd in timeline.
From bitcoin to blockchain and distributed ledgers
We’ve seen the discussion on bitcoin gradually shift towards blockchains and distributed ledger systems. And right now we have a dazzling bunch of currencies, blockchains and confusing ecosystems around. Price spikes and Initial Coin Offerings confuse the public but do create this renewed sense of interest and enthousiasm.
If we look past all todays noise, we can essentially see:
- Blockchain applications of all kinds. New entrepreneurs develop new blockchains or dapps on blockhains as part of new business plans. This feels like everyone scrambling to become the new facebook, google or airbnb in the blockchain world. An interesting look at the wide variety of Decentralised Apps (DAPPs) is possible via the website: State of the Dapps.
- Distributed ledger applications are under development in the corporate organisations. In essence these applications boil down to intra-corporate bookkeeping as a more efficient alternative for transaction chains that move beyond the single organisational domain. For that reason, we see the emergence of all kinds of industry consortia to establish joint standards and practices for their respective industries (banking, insurance, logistics, food, energy etc). , vervoerders etc) bij elkaar ziet kruipen om verdere afspraken hierover te maken
Of course there are also combinations available in which existing organisations adapt their business and use a blockchain to make the transaction chain more transparant to the public or to outside players. Imagine for example the use of a blockchain as a public share register or a register of delivery and use of energy.
The true challenge: governance
Of course each organisation faces a unique challenge with respect to blockchain and distributed ledger technology. Some organisations may be far ahead in experimenting while others still adopt a wait-and-see approach.
In most cases it is the governance of business processes that contain the real challange. The technology itself is pretty flexible, but the main question is. How can business processes be remodelled in an effective way. How can a migration occur of an industry from its current work slows and governance, to new work flows with different governance and standards? The questions at stake are:
- what is the awareness and knowledge with respect to blockchain and distributed ledger technology and it’s possible impact?
- what are the current insights and experiences?
- which business process will be impacted or will be redeveloped?
- what is the objective and economic ratio of the new business model?
- what is the ethical impact of a solution: how will it impact society when implemented widely?
- which cooperations are necessary to make a new business model or process work?
- what is the contractual and legal basis for cooperation and for the use of the new technology?
- what is the basis of the smart contracts for participants or devices that are part of the application?
- which technology, blockchain or distributed ledger concept is best (and is a blockchain truly the best solution)?
Consulting – awareness – product development
I look forward to supporting your organisation in the area of blockchain, distributed ledger and its application for business purposes. This can vary from designing and delivering awareness sessions and workshops to contributions during product development. Mail me for further information and references of my pevious work.