2018 was yet another big year for blockchain. Organisations across many industries from retail to shipping are using the technology to counter disruptive threats, and push into new markets to create new revenue streams.
One of IBM Australia’s major projects was to work with Herbert Smith Freehills, Data61 and King & Wood Mallesons to pilot the Australian National Blockchain (ANB).
In this consortium, we are designing and building an enterprise-grade blockchain to serve as the backbone to Australian business and address a challenge that spans all industries – the age-old, but indispensable, process of contracting.
The ANB will serve as an ecosystem for smart legal contracting, bringing to life key terms and connecting these to the data sources and business processes that they ultimately govern.
This is my third full year working solely on blockchain, and I am often asked by organisations to help them anticipate market shifts and changes in the competitive landscape.
So, what will this year hold for blockchain? Here are 6 blockchain trends we think you should look out for in the coming months.
1. Blockchain quietly goes mainstream
Consumers will begin to see blockchain applied to a variety of everyday uses without even recognising it as blockchain. Much of this exposure will come through supply chain projects, such as the ability to scan a label on a food product – put in place by the food ecosystem to enhance consumer trust and improve food safety and traceability.
2. Regulators flex their muscles
Expect to see government agencies worldwide issuing opinions as they work to classify blockchain-based financial instruments and build sustainable regulatory frameworks. For what is, in theory, a borderless technology, borders are playing a big role.
3. Production-ready blockchain initiatives emerge in government
We fully expect to see state-led projects setting the tone in this space and acting as the proving ground for subsequent federal initiatives and whole-of-government work. This has started to emerge with examples across governments in Delaware and Idaho in the United States as well as the NSW government in Australia.
4. Engineers start skilling up
Blockchain proof of concept (POC) initiatives aren’t especially hard but production-ready blockchains running live transactions across a (sometimes very large) group of organisations need highly capable software engineers.
Expect strong software engineers that turn their attention to blockchain to become the new rock stars of the tech world in 2019. Diverse and multi-disciplined tech teams will be as important as ever too, to bring IOT, AI, analytics and other technologies together with blockchain to unlock the next level of value that these networks should bring for early adopters.
5. Blockchains get chatty
Blockchain networks to date, while sharing the same underlying technology, typically remain siloed. But in 2019, as organisations integrate their existing systems and business processes into these solutions, this will in turn trigger the linkage between blockchain solutions – likely at all levels of the tech stack.
Everyone knows that blockchain interoperability is a ‘must’ at some point, the question is when and how it will manifest in solutions and projects.
IBM is doing work in this space and we expect to see it becoming a common ask from consortia and clients as we move through the year. Standards are going to be crucial as part of this challenge too.
6. Consortiums become clearer
The word ‘consortium’ seems to get more airtime in relation to blockchain than ever before. At the heart of consortiums, is collaboration. Blockchain networks struggle to grow or trigger the all-important network effect without collaboration.
Mobilising a consortium or business venture when you are establishing governance models around shared data and distributed systems, as well as encouraging fast product development and setting things up to scale, is not easy.
This level of complexity is why the experience and expertise to guide projects from a POC phase to a pilot and then to a production-ready solution is becoming so valuable. Companies and people that know this stuff and have done it before will be the ones to give consortiums greater clarity and confidence this year.
Rupert Colchester is head of blockchain, at IBM Australia and New Zealand.