Is This The End Of Blockchain?

© 2018 Bernard Marr, Bernard Marr & Co. All rights reserved
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In recent years much has been said about the transformative power of blockchain
– the distributed, encrypted ledger technology that powers Bitcoin.
Although Bitcoin and other cryptocurrencies are its most publicized use cases, it
was often said that blockchain would revolutionize many other business
processes across industries, from banking to diamond mining and food safety.

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However, a recent study into 43 initiatives reported that despite a great number
of promises and convincing arguments, none of the projects have been able to
show that they have been able to use blockchain technology to achieve their
objectives.
With Bitcoin and other cryptocurrencies steadily losing value during 2018 – as
much as 80% compared to their peaks last year – is it time to admit that the great
experiment with decentralized, distributed ledgers has failed?

Issues Within The Cryptocurrency Industry
Whenever any new technology emerges which has the potential to shake things
up, the loudest noise will be made by those selling it.
On top of this, blockchain has been tainted in the minds of many, thanks to the
large amount of hot air, and outright scams, that have been generated by the
cryptocurrency industry.
Aside from a large number of exchanges vanishing with customer funds, and
later being exposed as illegal operations, the trend of ICOs – initial coin
offerings – has resulted in many failed projects and lost money.
ICOs are touted as a new way of raising capital for a business by offering digital
cryptocurrency tokens which in theory will increase in value as the business
grows.

Issues Within The Cryptocurrency Industry
However, the lack of transparency around the practice, and the tendency for
initiatives to disappear into thin air along with investors' money has led to
regulators issuing warnings about getting involved.
While these issues bear little relationship with industrial blockchain concepts,
which often use private blockchains, the large amount of negative press has
undoubtedly led to organizations becoming more careful.
This is even impacting the language companies use – where the term distributed
ledger technology, abbreviated to DLT, is becoming more common so that
businesses can avoid the negative associations of the word blockchain,
according to Forrester.

User Adoption
Beyond that, Blockchain has other fundamental barriers to adoption. One of
these is the fact that it isn't always easy to explain to someone what's so
revolutionary about blockchain.
Sure, it allows us to keep secure records of transactions – but so do other
conventional databases if properly secured with cryptography.

The Environmental Costs
Perhaps most damningly are the environmental costs of generating the
computing power needed to fuel many blockchain applications such as Bitcoin.
Solving the cryptographical challenges that keep information stored on a public
blockchain secure requires vast computing resources. Earlier this year it was
reported that the Bitcoin network is on course to burn through 42 terawatts of
energy in a year – which is more than the entire energy used by countries like
New Zealand or Hungary.
Producing this amount of energy creates 20 megatons of CO2 emissions – the
same as about one million transatlantic flights.

The Environmental Costs
Indeed, private blockchains implemented within enterprises wouldn't use energy
at anything like that scale – but proportionally, they are still often highly CPU
intensive.
And with CPU power at a premium thanks to the rollout of Artificial Intelligence
(AI) and predictive modeling technology, which have been proven to generate
growth, it’s often hard to make a case that blockchain represents a worthwhile
business investment.
Analysts at Forrester predict that 2019 could be the beginning of a “blockchain
winter” – when frustrations and lack of results, together with a lack of
understanding of the technology, mean excitement wanes and enterprise
projects are mothballed.

A “Blockchain Winter”
Analysts at Forrester predict that 2019 could be the beginning of a “blockchain
winter” – when frustrations and lack of results, together with a lack of
understanding of the technology, mean excitement wanes and enterprise
projects are mothballed.
It may not all be doom-and-gloom, however. Some have pointed out that it's
possible that blockchain is a technology which arrived ahead of its time.
This is something we have seen before with AI and machine learning algorithms,
which were developed in the 1950s, and only today have access to the data and
computing power to deliver transformative results.
AI has gone through various hype cycles and ‘AI winters’ before it finally became
mainstream.

The Future of Blockchain
Bitcoins, Ethereum and initiatives such as Kodak’s venture into the world of
blockchain may burn out and fade away. But the fundamental concept of a
shared ledger technology secured by encryption may become more appealing if
new technologies (for example quantum computing) can make it a more viable,
and less environmentally damaging, proposition.
Whatever the eventual outcome, it's clear that blockchain, in general, is taking a
less significant position in many commentators’ predictions for where tech will
take us in 2019, than it did in 2018. Time will tell whether this means the
beginning of the end of blockchain, or merely the end of the hype that fuelled
blockchain’s beginning.

© 2017 Bernard Marr , Bernard Marr & Co. All rights reserved
Bernard Marr is an internationally best-selling author, popular keynote speaker, futurist, and a
strategic business & technology advisor to governments and companies. He helps
organisations improve their business performance, use data more intelligently, and
understand the implications of new technologies such as artificial intelligence, big data,
blockchains, and the Internet of Things.
LinkedIn has ranked Bernard as one of the world’s top 5 business influencers. He is a frequent
contributor to the World Economic Forum and writes a regular column for Forbes. Every day
Bernard actively engages his 1.5 million social media followers and shares content that
reaches millions of readers.
Visit The
Website
© 2017 Bernard Marr , Bernard Marr & Co. All rights reserved
Bernard Marr is an internationally best-selling author, popular keynote speaker, futurist, and a
strategic business & technology advisor to governments and companies. He helps
organisations improve their business performance, use data more intelligently, and
understand the implications of new technologies such as artificial intelligence, big data,
blockchains, and the Internet of Things.
LinkedIn has ranked Bernard as one of the world’s top 5 business influencers. He is a frequent
contributor to the World Economic Forum and writes a regular column for Forbes. Every day
Bernard actively engages his 1.5 million social media followers and shares content that
reaches millions of readers.
Visit The
Website

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Is This The End Of Blockchain?

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Is This The End Of Blockchain?