Blockchain technology and its counterpart cryptocurrency were in the spotlight for much of 2017 and 2018. We watched the price of cryptocurrencies soar producing an abundance of new entrants into the ecosystem in the form of investments, start-up projects/pilots programs, talent, and buzz, in general. And then subsequently, a spectacular decline in the value of cryptocurrencies combined with an uncertain regulatory environment and signs that the technology was still in its infancy, with many projects still in development, disappearing or shuttered. (There is even a list of shuttered projects which showcases almost a 1000 projects that won’t see 2019). All this noise soured much of the hype, mainly for the better, leaving the blockchain industry to self-reflect and take stock.
As we enter 2019, it is looking like the year the blockchain industry starts delivering on its promises or at least that seems to be the mandate, especially from some VC’s. For all the hype many teams have been heads down working to deliver the next generation of technological solutions or the fourth industrial revolution as some have started to call it.
You can also watch Arbol’s CEO, Sid Jha, share his own observations for 2019 HERE.
According to Mike Orcutt of the MIT Technology Review, the technology will start to become mundane and fade into the background as it becomes more practical to use and big financial institutions get more involved with digital assets (like ICE and Fidelity), larger companies start using blockchain for their supply chains management (like Ford), and central banks (IMF) get more serious about digital currencies. So before Blockchain can fulfill its disruptor status it must create products that are relevant, easy-to-use, and even boring to regular consumers. In this case, boring is considered good.
Some players will try to distance themselves from the word blockchain, itself, and focus on the umbrella term — distributed ledger technology. This seems to be already happening at the enterprise level with HSBC, a large multinational bank, sharing that is has settled 250 Billion in trades with distributed ledger technology (DLT).
For many, the word blockchain has become synonymous with the hype, regulatory hurdles, and other technological challenges so in order for large scale enterprises to push projects forward they may start to use the term distributed ledger technology (DLT) or tout those projects to differentiate this year’s projects from the previous years.
However, blockchain and DLT are not exactly the same blockchain is actually a type of DLT and while all blockchains are DLT’s, not all DLT’s are blockchains. But, according to the Forresters’ 2019 prediction report by adopting this new terminology teams may avoid the endless arguments over whether a particular solution is or isn’t a real blockchain and push forward.
Pigging back off the previous prediction as more data and transactions are stored on different systems like permissioned (private) and permissionless (public) blockchains, there will be a growing need for more interoperability between them. There are some initial solutions available today however we expect to see the emergence of more and the easier integration with existing enterprise systems. APIs will play a key role in this evolution.
Stablecoins will continue to dominate the conversation from why we need stable programmable money vs. just money that is sent digitally (which already occurs). To, will stablecoins ultimately provide that stability (asset or algorithmically backed) or it will be some other form of digital money. And, out of the existing stablecoins expect the wars to continue — projects likes of Circle, Coinbase, Gemini, and others will eat away at the monopoly Tether once enjoyed. Even if Tether doesn’t go the way of Basis, which shuttered at the tail end of 2018, its prominence is already lessening as investors and projects look for alternatives.
2019 will be a year where the industry will shift its focus toward the real-world problems that blockchain technology can solve. According to Deloitte’s 2018 Global Blockchain Survey, companies are starting to move from proof-of-concept projects to real-world applications. There will be a particular focus on discovering not just where blockchain could fit, but to find places where it is the best fit. We will, therefore, see a transition of enterprise interest towards identifying tangible, productive use cases for blockchain.
We at Arbol are excited for the year to come and predict an awesome 2019!
Watch Arbol’s CEO, Sid Jha, share his own observations for 2019 here.
Arbol makes automated payments based on weather outcomes using smart contracts and third-party weather data.
