Trends Driving the Blockchain Industry
While the financial sector continues to grapple with the technological wave, cryptocurrency, and the related fast-growing popularity has replaced the traditional methods of transactions. This has caused the emergence of blockchain, which caters to all kinds of transactional needs; and provides a safe and secure platform to carry out deals.
A blockchain facilitates the transfer of digital assets or currency, which has played an important role in furthering the usage of cryptocurrency and bitcoin exchanges. It is constantly developed and driven to make transactions as easy and seamless as possible. Here are some of the trends that are driving the blockchain industry.
Enterprise Tech Companies- The main use of blockchain, when invented, was to decentralize finances and to depart from the traditional way of handling monetary data. However, several companies and firms are in the midst of developing their own blockchain tools to roll out its benefits as service.
Decentralization of Finance- Decentralised Finance, also known as DeFi, a monetary system built solely to aid blockchain, includes digital assets, protocols, and applications. This financial software has transformed loans, exchanges, and insurances; and is a trend that caught on early on.
Stablecoin- As cryptocurrencies hit the market, a need for stable-value digital currencies was realized. Stablecin or Tether is one of the most commonly used cryptocurrencies across the world, by proving to be an intermediary between US dollars and cryptocurrencies. It eliminates problems arising from varied currencies.
A Blockchain Network- Blockchain is being mobilized, as different variations of it have begun popping up. This has paved the way for the interconnection of blockchain and its interoperability. Unlike banking and allied financial institutions, blockchain does not have the trouble of not acclimating or interacting with each other.
Internet of Things and Blockchain- The surge in internet-connected devices has increased ten-fold in the latest years. However, there persists a need for safe and secure networking or communicating with each other. Blockchain simply resolves this and houses immense potential to interconnect things, for the world to run seamlessly.
With an establishment as a foundational technology, blockchain has found utility in every industry and sphere.
Enterprise Blockchain Trends: Digital Identity Management
Despite the much-touted promise of Blockchain/Distributed Ledger Technologies (DLT) to transform industries and create expanded business value, enterprises still struggle to identify where blockchain offers better value than existing technologies, and they lack the expertise to use the technology to address new business challenges. A blockchain is a decentralized time-stamped ledger (or immutable record) of transactions that are written and cryptographically secured on a peer to peer network.
The nascent and immature nature of many components of the DLT, as well as unclear regulatory requirements and technology standards present further challenges that most enterprises are simply, at this stage, unable to overcome. A recent Gartner report estimated that only 10% of enterprises will achieve any radical transformation with the use of blockchain technologies by 2022.
Despite the above challenges, enterprise blockchain use cases continue to grow in 2019. Many corporations across industries have on-going blockchain projects either as internal experimentations or as part of an industry consortium initiative. Some of these initiatives are industry-centric (e.g. FX Settlement in Banking, or Provider Data Management in Healthcare), while others offer potential application across industries, such as Supply Chain Management applications in Retail and Pharmaceutical industries.
Few of these blockchain projects have yet to launch successfully to date, though Gartner predicts that the business value attributable to blockchain will grow to over $360 billion by 2026, and surge to more than $3.1 trillion by 2030.
An emerging cross-industry use case of blockchain technologies worth noting is Digital Identity Management, which enables the implementation of Self-Sovereign Identity (SSI) management.
A digital identity is a digital representation of an entity (individual, organization, or object); it is information, or a set of attributes, related to the entity. Self-Sovereign Identity is based on the premise that individuals or entities can maintain ownership and control of their own digital identity data.
Given the transformative potential of SSI as well as the impact it could have on how enterprises handle the security and privacy of identity data, it is important that business leaders stay attuned to developments in this space.
Wrangling the Identity Management Challenge
The centralization of user identity data in silos controlled by service providers often leads to data breaches as well as to use of the data in ways that identity owners neither know of nor consent to. It also imposes significant privacy and regulatory requirements on service providers that even the best resourced enterprises find difficult to effectively manage. Decentralized identity management schemes built on blockchain technologies have been proposed as a means of addressing some of the challenges inherent in legacy digital identity management.
It is important to understand that blockchain is not well suited for storing actual identity proofs (i.e. the documentation, such as a driver’s license or passport, required to back up the claims that an individual or entity asserts about themselves). The relatively low transaction speeds of many blockchains, as well as the immutability of distributed ledgers, do not augur well for storing large volumes of sensitive unstructured data that an individual might opt to have forgotten at a future date per privacy regulations. A variety of schemes, such as Zero Knowledge Proofs (ZKPs), have been designed to enable the secure sharing of identities using the blockchain.
Examples of blockchain based digital identity solutions include offerings by business consortia, such as Canada’s Verified. Me by Secure Key Technologies, and Corda Enterprise by R3, as well as solutions built on Open Source platforms such as the Lifeid, and Sovrin. Some major technology corporations such as IBM and Samsung also have active blockchain-based digital identity initiatives. The list of big-name players in this space is expected to grow over the next year.
While the approaches taken by these SSI implementations vary, the promise is similar - an entity should be able to assert a verifiable claim about themselves to a service provider(for example that they are of a certain age) without having to disclose more information about themselves than is required to obtain service. SSI allows users to maintain ownership and control of their own identities, determining who gets what parts of their identity data, and for how long. It also offers users the potential to monetize their own identity data and to assert their rights to be forgotten under privacy regulations such as the European Union’s General Data Protection Regulation.
Beyond the walls of for-profit enterprises, SSI is being leveraged to address the identity challenge prevalent during humanitarian crises where large populations of displaced persons lack secure and portable digital identification. Today, 1.1 billion people worldwide lack digital identification. Ongoing efforts in this space include the Identity for All (I4ALL) based on the Sovrin platform, and the ID2020 project, supported by an alliance of NGOs and corporations such as Microsoft and Accenture.
We are yet to realize the full transformative value of blockchain in the enterprise, but given various SSI efforts currently underway and some early successes (such as with Verified.Me), digital identity management will be one of the areas where consumers and enterprises alike can expect to derive benefits from distributed ledger technologies in the near future.
Do not Overlook these Four Blockchain Technology Trends!
Blockchain-based applications hold tremendous potential to reshape the future of the industry ecosystem.
FREMONT, CA: The blockchain technology made its debut in 2009, and ever since, the technological world has experienced an exponential transformation in the ledger technology. From the healthcare sector to banking, the application of blockchain made headways into various industries. As the growing list of blockchain applications reaches the stratospheric level, enterprises and businesses accelerate to replace the traditional techniques with the upgraded ledger technology. It is clear that blockchain-based applications hold tremendous potential to reshape the future industry ecosystem. However, the present development in emerging trends should not be overlooked.
The rise in the Usage of Federated Blockchain
In the advent of 2019, the term Federated blockchain, merely an updated blockchain model, created a significant buzz among the business markets. Highly customizable feature and improved private platforms compelled industry experts to refer enterprises for obtaining federated ledger technology. The additional feature of having multiple authorizations to control a pre-selected node takes federated blockchain a step higher than others.
Stable Coins in the Crypto Space
Cryptocurrencies, the sub-products of blockchain technology are very volatile in nature. Even though the digital currencies are in an initial phase of development, the financial experts have predicted a maximum elevation in its value. Integration of blockchain to stable coin industry will unlock an additional layer of security, fast remittance, and affordability. The constant risk currency crashes will be yesterday’s inconvenience for investors with the inclusion of blockchain’s new firewall. More stable currency exchange not only facilitates an easier peer-to-peer (P2P) currency exchange but also improve the cryptocurrency market.
Adoption of Blockchain as a Service (BaaS)
With the tech giants such as Amazon and Microsoft increasing their alliance with blockchain as a service (BaaS), the popularity of blockchain technology has skyrocketed in the competitive market. Rookies from this sector are investing in the cloud-based digital blockchain service without considering the complex and convoluted maintenance and management solutions. However, the implementation of blockchain has proven to be useful in many instances.
Birth of Hybrid Blockchains
Hybrid blockchains have lowered the transactional cost by providing powerful nodal network system. Looking at the recent success of blockchain, there is no denying the fact that this technology has the potential to reshape the entire industry all by itself.
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