Sales Director of Professional Services, Atende SA
Will blockchain be the “new internet”?
“What is blockchain technology” is probably not a topic worth dwelling on it today. Most people who are interested in technology know that already. However, that’s not necessarily the case for possibilities that it creates. When we look at the number of articles, conferences and speeches made about blockchain, one can get the impression that we are at a similar moment as about 20 years ago, when the IT industry speculated about the huge opportunities stemming from the growth of the Internet.
There is no doubt that the Internet brought about a revolution – both in daily life and in the way businesses operate. It gave unprecedented opportunities for growth. The amount of data generated today by Internet users is unimaginable. But all these changes happened relatively slowly, over a dozen or even several dozen years. Not during the time span that the IT world originally assumed. So, will blockchain cause more intense and faster changes than the internet? It is quite possible that the answer is: yes. The reason might be simple: access to technology today is on a much higher level than 20 years ago. In addition, we have a much more dynamically growing startup market, which may be the main driver of market changes. Even if only a small percentage of the startups grow into bigger organizations, the pressure they will cause on traditional businesses will be meaningful, which will force those businesses to look for new areas and opportunities.
Freedom or control?
Blockchain is also a world of cryptocurrencies and a system which can realize specific business goals without the participation of any companies but directly between the parties of the transaction. This means freedom.
On the other hand, on the horizon we can see the possibilities of using blockchain combined with IoT and 5G technology to maximize control in those areas of our lives, which today we consider intimate. An example would be a combination of blockchain with IoT and video cameras. It would not only be a solution guaranteeing the unchangeability of records and durability in time, but also an unlimited tool for controlling citizens. We can imagine a situation where an institution monitors a selected area of the city using cameras, and the video files created in this way are fixed in a blockchain. Incidental recording such monitoring in a public blockchain without specifying access rights and controls may result in mass access to content that should not be disclosed.
This black scenario is possible in any other area in which we deal with data processing. It could be any data coming from, for example, phones that monitor our health, implanted chips, e.g. in prisoners, etc… Would we want, for example, our data from smartwatches to be fixed in a permanent and unchanging way in the blockchain without the possibility of its subsequent removal?
Efficient and smooth processes
On the other hand, blockchain offers huge possibilities in terms of the credibility and permanent recording of transactions or selected stages of business processes. This in turn allows businesses to enter new areas or markets that are out of their reach today, e.g. due to too high risks or costs.
We can imagine that a production plant with a complex production line would like to insure its semi-finished product at any stage. Today, no one will decide to assess the risk involved and offer and insurance deal, because this process is beyond the control of the insurance institution. However, by acquiring data from any stage of the production process and authenticating it using blockchain, the insurance institution can have full insight into the process and could become willing to provide insurance without fear of abuse.
New products and directions
Examples of the use of blockchain in the insurance industry are numerous. Using the blockchain-based functionalities in the so-called SmartContracts, combined with IoT, the payment process of compensation as a result of a specific event could be automated. One of the insurance companies is already offering such a product for customers. Being at the airport before the trip, the traveler buys insurance by smartphone for a delayed flight or lost luggage. After landing, data on delays are automatically collected from airport registers, and any compensation is also calculated in an automated manner.
As research suggests, the biggest impediment in concluding insurance transactions is the customer’s reluctance to bureaucracy in the event of damage. If we automate this process, the main obstacle will be eliminated. Similar solutions are perfect for small and uncontrolled insurance.
The possibility of using blockchain in the eSport industry is also very interesting. When I talked with institutions providing data to bookmakers’ offices they told that a few years ago transactions related to e-sport events constituted a fraction of their business activity. Today the proportions have drastically changed. As we know, wherever great money is involved, the temptation of fraud is born. It therefore seems that it will be a natural market for the use of blockchain technology.
In which direction will the blockchain market evolve? Which solutions will be verified by business and consumers? Today, it’s still a philosophical question, but I am sure we will get the answers in the near future…