Until recently, cryptocurrencies were the only major application of the new blockchain technology. Will the BTC be able to replace the dollar as the global reserve currency? This question has long been the focus of attention and has brought enormous attention to Blockchain trading. In the background, however, a development has started which has a very different focus.
Which technology group and startup can make the most of the technology and become the big player in the new blockchain economy?
The application as a blockchain coin is still the driving force and the hundreds of thousands of developers behind Bitcoin, Ethereum or Ripple ensure that the necessary basics are built. But the goal of the effort is no longer limited to currencies alone.
Smart contracts and DApps have shown new possibilities. But is this already the triumph of the Distributed Ledger preprogrammed? Whether or not the use of decentralized encryption networks will become a matter of survival in a new economy is a hot topic today. Here we want to get to the bottom of the matter and ask four central questions.
- Why is the new technology so popular?
- Is the technology behind Bitcoin & Co sufficiently innovative?
- Is the blockchain revolution actually ripe for the mainstream?
- What benefits can the Blockchain Revolution have?
Trust Economy
Trust is one of the most important foundations of the economy. The proverbial handshake quality has been the prerequisite for centuries for people who do not know each other personally to act together. Every economic crisis is therefore at its core as a crisis of confidence. Today countless security systems, such as rating agencies, are busy maintaining it.
But what if this valuable asset no longer has to be painstakingly produced, but is available to everyone through autonomous systems? For the economy, it is clear that the blockchain is gaining importance for this reason. From this perspective, the attributed revolution has three tangible roots:
- Secured trust reduces trade barriers
- Markets can react faster and generate growth
- The secondary costs for security system can be drastically reduced
The Blockchain simply explained it as therefore basically a Trust Protocol. A trust protocol with a huge economic long term effect for almost every industry.
Blockchain Revolution: A review
Don and Alex Tapscott discuss the entire range of application areas in their eponymous book “Blockchain Revolution”, which is sustainably transformed by decentralized encryption platforms. It soon becomes clear that it is no longer the financial sector or the economy alone that is affected by it, but all areas of life affected by digitization.
For example, an Internet of Things needs a passbook of things. The development of the Internet of Things has so far had a big blind spot. That is, the reliable and secure processing of the huge amounts of data. With decentralized encryption and management through computer networks, this blind spot is easily solvable.
Systematic consensus is another example. The organizational principle of large companies has long since moved away from the rigid monolithic administration towards flexible ecosystems with a small corporate core. Only the flow of information and decision-making remains a major field of development. With decentralized voting based on smart contracts, both the complexity and the reaction speed can be controlled.
E-Residency 3.0 is what is discussed in this country as a cumbersome citizen card and digital administration, elsewhere is slim and efficient already lived reality. Whether applying for a new passport, filing a tax return or participating in a citizen survey, with the Distributed Ledger can be the concerns well implemented, without sacrificing German thoroughness.
The two authors provide an exciting insight into the full range of changes that are approaching us through the blockchain. However, they remain in many areas on the surface, but you can read and deepen here on our page well.
Is the blockchain the innovation engine of the next generation?
What do the steam power, radio and television as well as the Internet have in common? In each case it is a so called Disruptive Innovation is a new technical development that brings unrest into the system. Many unsettled, but in the end has brought about a revolutionary improvement for all. The Bitcoin mastered the part with the restlessness at least bravely measured by its critics. But what about innovation?
In the meantime, the technical superiority of Distributed Ledger is no longer a matter of dispute. The reason is not just that blockchain mining has become an important industry and many already own a blockchain wallet. Rather, the superiority comes from a very simple business reason. The decentralized encryption is safer, faster and cheaper than conventional systems.
Almost every major engineering company now has a development department on the subject and the first pilot projects have already been successfully implemented. Starting with the Internet companies up to the German car industry here ranges the bandwidth.
Amazon, Microsoft and Co are integrating decentralized encryption into their cloud services such as Amazon Web Services and Azure respectively.
Volkswagen is one of the first industry giants to bring the Blockchain to production maturity with the Digital CarPass.
It is good practice to judge a new technology not just on the basis of its promises, but also on the basis of concrete numbers. By 2019, it is estimated that more than $ 20 billion will be invested in startups and development teams around the new encryption technology.
The job market for technicians who can program the blockchain is growing steadily. In the last six months alone, vacancies for technicians and software developers with the corresponding know-how have risen by around 200 to more than 1000 across Germany.
For investors, these numbers are very concrete indications of being on buy when it comes to the question of wanting to buy one or the other fund to Blockchain. Although CryptoCoins are putting traditional financial instruments under pressure, investors are a very good indicator of whether or not a new technology has innovation potential. In this respect, the question is no longer whether, but only which asset is bought.
Has the Blockchain revolution already arrived in the mainstream?
The number of headlines that are now to be found in established business magazines such as Forbes speak here a clear language. The topic Blockchain Revolution has arrived in any case. Even large public television channels, such as 3sat, place it already at prime time. Of course, business magazines and public sector channels are not yet mainstream in the true sense, but they are in many areas the trailblazers when it comes to new questions.
Interestingly it is also less the number and airtime of the media coverage around the topic, but the concrete blockchain info in the reports. The picture that emerges may be troubling for some, but for others it is an exciting new development. The revolution has already begun behind the scenes and is in the process of sustainably changing many areas of life over the next few years.
Why is Blockchain Logistics such a big topic?
The word “logistics” may at first glance seem a bit technical and dusty. However, the meaning behind it is one of the most important economic tasks for businesses and economies. The supply of customers with essential products but also consumer goods as well as the supply chain management of supply chains in the industry is with about 20% a large area of the entire value added chain. The interest in safety and cost reduction is correspondingly high.
For example, the pharmaceutical industry is one of the most regulated industries, despite its bad reputation. Medicines are a delicate commodity as they must ultimately make a significant contribution to our health. Above all, the challenge is that as consumers we need to be protected against counterfeiting but also against spoiled products such as most medicines must be stored and transported in a cool and very tight temperature range.
A cargo container containing pharmaceutical content requires around 200 documents during its journey. Which must be signed, countersigned, preserved, presented, and finally archived by hobbyists and government agencies. Not surprisingly, the industry spends around $ 15 billion a year on cold chain logistics alone outputs.
The application of autonomous freight containers, which manage themselves in automated logistics chains, can expect a cost reduction of around 40-60%. So far, however, no technical solution could guarantee the safety and reliability. With the Blockchain, this picture has changed considerably.
Can the Blockchain energy industry save the sustainable energy transition?
The conversion of the energy industry to sustainable resources is without a doubt one of our biggest survival questions. The energy transition has therefore begun some time ago, but has now somewhat stalled. One reason for this is that the implementation of large wind turbines and solar systems is not possible to the extent that the planners intended.
Energy independent houses are no longer a technical challenge. The use of solar energy, geothermal heat as well as wind and water power is much more efficient in the small scale area than in large scale plants. The problem, however, is that the energy is not always available when needed. With small battery systems reserves can be buffered but only to a certain extent. However, if the entire network is cooperatively connected, things look different.
Smart Grids, which connect millions of households and flexibly distribute the energy between generation, storage and consumption, can be the solution here. The power generated by a wind turbine is stored in dozens of battery systems by self sufficient houses until it is needed.
But if you take a look at your electricity bill, you’ll also get an inkling that the complex accounting of billions of transactions for traditional accounting and management is not solvable. Here, too, the decentralized encryption acts as a GameChanger. It can manage the huge number of billing cost effectively.
Conclusion
New technology advocates often see the big GameChanger being changed in a new development. For investment managers and fund companies, however, concrete figures are crucial when it comes to determining an investment strategy. Regardless of promises, the bottom line is a simple question. Is the technology accepted by the market?
Television and the Internet took decades before it was clear that a technical revolution had changed the economy in a sustainable way. Bitcoin and its technological base have made the leap from vision to market adoption in ten years.
In the financial industry, Ripple and Co have already helped the encryption networks to achieve remarkable market penetration. The first pilot projects have been successfully completed in logistics, the energy industry and the automotive industry, and it is time to move on to series production.
The blockchain revolution has not yet brought all the teething problems behind. Bitcoin or Ethereum are struggling to be able to handle the high number of users actually cost-effective and fast.
With IOTA, however, a blockchain 3.0 is already in the implementation, which is technically mature and can handle millions of transactions per second.
Measured by relevant development budgets, the blockchain today is more than a mere promise. It is the technical solution that the Internet of Things has been waiting for. Today, therefore, there is no longer the question of whether the so called blockchain revolution will come, but who will benefit first. For us, too, the question remains exciting. We will therefore continue to keep you informed of which startup and which technology group are using the most successful concepts.
Also published on Medium.