Though the development is in early stages, we are already seeing few new trends emerging.
Blockchain technology has been providing new spurs and opportunities to all the sectors today. Essentially, it has emerged as a strong tool of empowerment, bringing efficiency, transparency, credibility, and consolidation in transactional processes while offering significant benefits to the end-user. While it may have been initially discovered as a robust technology behind Bitcoins, its potential as a catalyst to drive future growth and transformation across a whole range of industries is gaining momentum and is yet untapped. Though the development is in early stages, we are already seeing few new trends emerging. Let’s look at some of these that are emerging in 2018 backed by blockchain:
Institutional investors are opening for blockchain projects, curbing volatility that existed for two years
The automatic association of blockchain with cryptocurrency has kept the market volatile in the last 2 years for retail investors, however now a cautious approach from institutional investors towards investment in the underlying technology, blockchain has started bringing stability and positive market sentiments. In fact, government representatives in many countries such as Singapore are increasingly demanding an end to speculation induced volatility and have expressed their desire for more institutional investment in the innovative technology. A higher number of institutional investors are now participating in Initial Coin Offerings or ICOs, a means of raising capital through cryptocurrency by start-ups. In fact, between January-June 2018, a record USD 7 billion was raised through ICOs, which is more than whole of 2017 and most of this is an Institutional investment. The participation of institutional investors will provide a sigh of relief to the market stakeholders and help address the problem of volatility, boosting ICO growth and adoption.
Convergence with emerging technologies - AI and IOT
AI and IOT are increasingly experimenting with blockchain to achieve the convergence synergies between the two. future homes, workplaces, public institutions, transport or even the entertainment world become ‘smarter, there arises a greater task to keep the systems efficient, transparent and hackproof. A dedicated AI based blockchain technology, with enhanced algorithms and complete decentralisation, will help to not only achieve automation but also tackle the problem of security & transparency. Simple, cost-efficient and the evolving blockchain technology can be leveraged for improving the AI and IOT applications and vice versa. Applications meant for homes, malls, interactive retail outlets along with specific domains such as healthcare, smart cities, agriculture, energy grids, water management, supply chain management and entertainment among other application areas tend to benefit from this convergence.
Augmented use of smart contracts
Smart contracts are one of the most interesting characteristics of Blockchain technology because they have the potential to evade third parties and to create impermeable agreements among all stakeholders. Any industry that relies solely on agreements and has a huge scope for violation vulnerability, like the entertainment and Financial industry, has a lot to leverage through smart contracts. The use of Blockchain technology can offer increased transparency and safety while simultaneously speeding up the whole process. Contracts can also be signed and substantiated in real-time, which can make a huge difference when it comes to responding rapidly to changes in the market.
Take for instance musicians or content creators who have been relying on labels, distributors, promoters and a host of other intermediaries to facilitate them in distribution or promotion of their content and music to the audience. Yet, they end up getting the short end of the stick frequently. Through Blockchain, there can be improved levels of security, transparency, and dissolution of middlemen in content monetisation, payments, and enforcing contracts can become easier. This can enable the content creator to interact with their audiences directly or evaluate their work through parameters that accurately reflect the public’s reaction to their content, something artists have been demanding for years.
Increasing participation from the regulators
With the increased use of Blockchain across different industries, there are higher chances of receiving interest from regulators, lawmakers, and even taxmen, especially if governments can find ways to use Blockchain technology on a large scale. For example, RBI is setting a blockchain and crypto research lab in India. As we see more multi-party involvement and confidence across regulators from different industries, Blockchain can serve as a simple & powerful tool for complex processes like settlements, clearing, complex multi-party payments & reconciliations, and open trade finance. Many countries & their regulators are redefining regulations to incorporate clear guidelines for crypto projects.
Businesses creating their own tokens seems to become a reality soon
Crypto is still relatively new as a financial token but they are catching up at the speed of thunder. Telegram, Kodak coin, and Facebook are few of the mainstream companies who seem to have marked their entry into this industry. many established companies are considering their own tokens already. However, the real challenge lies in maintaining the cryptocurrencies, convincing people about their worth in the future and getting them to use the same.
By: Nitin Narkhede, Founder, and CEO, MinersINC