Covid-19 fuels growth in enterprise or private blockchain

Monde
On the 11/04/20 at 7:58AM

by

Tuba Raqshan

Financial services sector is the most advanced in using this technology, according to a new report by cryptoassets and digital finance industry membership body Global Digital Finance (GDF).

Asia, in particular China, has taken a significant lead on the global stage in terms of development and implementation of enterprise blockchain, which refers to a set of of technologies, tools, and methods to build, deploy, and maintain shared business networks that are jointly operated by identifiable participants.

Keith Bear, associate partner, Elixirr, who authored this report with Michel Rauchs, managing director of Paradigma, said that China is leading the way in terms of network deployments and ecosystem growth, receiving an additional boost after the official endorsement by the government pursuing a strategy that establishes blockchain as a national priority.

While a growing number of businesses have made the transition from proof-of-concept or pilot into production on their blockchain projects, not all sectors have been equally involved, said Rauchs. “Besides healthcare and food/agriculture, networks built around financial services appear to particularly stand out. This may be due to financial services as an industry carrying an excessive burden of reconciliation costs due to the nature of value chains with multiple participants, extensive regulatory obligations, and historical market conventions. All these factors can add up to effective business cases focused on mutualised cost reduction in the first instance, often followed by incremental revenue generation through new business models in a second instance,” added Rauchs.

The report also highlights key trends that will impact enterprise blockchain, such as a growing number of business networks becoming more decentralised, for example. The focus in enterprise blockchain system will shift to application layer, due to which business networks will replace or supersede monolithic networks.