Commercializing Blockchain

Strategic Applications in the Real World

Antony Welfare

• Publisher: Wiley
• Year: 2019
• ISBN:
  9781119578031
• Edition: 1
• Topic: Business
• Subtopic: Financial Services
• Index: Business

The accessible, non-technical guide to applying and benefiting from blockchain technology.

Blockchain has grown at an enormous rate in a very short period of time. In a business context, blockchain can level the playing field between small and large organisations in several ways: Exact copies of the immutable, time-stamped data is held by all parties, all transactions can be viewed in real time, data blocks are cryptographically linked, all raw materials are traceable and smart contracts ensure no middle-men, ease of audit and reduced friction. The trust, transparency, security, quality and reduced costs of blockchain make it a game-changing technology that crosses sectors, industries and borders with ease. Even though the technologies are ready for adoption, businesses remain largely unaware of their full potential and effective implementation. End users require accurate and up-to-date information on the practical applications of blockchain — Commercializing Blockchain provides it.

A practical and easy-to-understand guide to blockchain, this timely book illustrates how this revolutionary technology can be used to transform governments, businesses, enterprises and entire communities. The author draws from his experience with global retailers, global technology companies, UCL Centre for Blockchain technologies, the government of the UK, Retail Blockchain Consortium and many other sources to present real-world case studies on the use and benefits of blockchain. Topics include financial transactions, tokenisation, identity management, supply chain transparency, global shipping and freight, counterfeiting and more. Provides practical guidance for blockchain transactions in business operations

• Provides practical guidance for blockchain transactions in business operations
• Demonstrates how blockchain can add value and bring increased efficiency to commercial operations
• Covers all of the essential components of blockchain such as traceability, provenance, certification and authentication
• Requires no technical expertise to embrace blockchain strategies

Commercializing Blockchain: Strategic Applications in the Real World is ideal for enterprises seeking to develop and deploy blockchain technology, particularly in areas retail, supply chain and consumer goods.

1
Introduction to Blockchain Technology

Welcome to the world of Blockchain technology, which I fundamentally believe will change our businesses and lives forever.

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Blockchain technology is by far the biggest revolution since the birth of the internet. Blockchain technology will affect the entire world – citizens, businesses and governments will transform, thanks to Blockchain.

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Let us start by understanding what Blockchain technology is and where it ‘fits’ into the current world.

Blockchain technology is a type of ‘distributed ledger technology’ which looks to share data and transactions across a number of different places. Unlike traditional databases, distributed ledgers have no central data store or administration functionality. A ledger is a record of data, which can be any data you wish to store and share. This ledger is tamper-proof and the data is encrypted for security.

Blockchain Technology Definition

Simple definition in nine words:

‘Trusted and efficient way of sharing data and transactions’

And a longer definition:

‘Blockchain technology can be viewed as a distributed ledger of information, which maintains a continuously growing list of records, called blocks, secured from tampering and changes.

Each block contains a timestamp and a link to a previous block. This means that blockchains are inherently resistant to modification of the data – once recorded, the data in a block cannot be altered retroactively.’

What Are the Reasons Why We Have Blockchain Technology?

My view is that Blockchain technology is the progression of three developments made in the last 20 years: The internet, centralization, and the ‘trustless’ world.

The Internet and Blockchain

Since the inception of the internet, we have progressed from Internet 1.0, which was the initial start of the technology and its adoption, to Internet 2.0, which is where we currently live.

Internet 2.0 is all about transactions and data – think about how you use the internet today – shopping, listening to music, banking, watching films, and social media – all of these activities are transaction based.

We all use the internet throughout our lives and it has become critical to our daily lives and our businesses. This has led to the second development: centralization and Blockchain.

As the internet grew through the 2.0 world, the largest global companies have been born: Apple, Facebook, Google, Microsoft, Amazon, Uber, etc. These companies now control our lives on the internet – everything we do one of these companies ‘owns’; we do not ‘own’ our data and transactions on the internet, these companies do.

This centralization of a few global technology giants has given them complete power and influence over governments and our lives. They decide what governments do and they decide what we do.

This power of the giants, together with mainly failed political systems across the world, has led to the third development described below.

The ‘Trustless’ World

We now live in a world where we lack trust in large companies and governments. In Western governments, there has been a trend towards nationalism and ‘localism’, causing global trade wars, global immigration issues, and governments who cannot operate effectively in the new world.

Ask a millennial if they trust the government and they are likely to say, maybe, no, or (even worse) I don't care. The trust that governments once had is slowly decreasing and a new political system is needed across the globe.

Large companies' trust levels are even worse:

• Do younger people trust banks? If they did why would the Monzo, Revolut, and Starling banks be growing so fast?
• Do younger people use Facebook? If they did, Mark Zuckerberg would not be facing government enquires for illegally selling its users' data.
• Is Google bringing back search results for you? Or has it been paid more to surface a different product to you?
• Is Uber cheaper, faster, and more comfortable than the centralized black cab world in London?

I will not continue as I am sure you understand my point (I am not trying to be political or opinionated here; I am surfacing facts and experiences that I have seen).

Let me quote a millennial I spoke to in 2018 as to why he was interested in Blockchain and cryptocurrency investments:

Banks give low interest so I wanted to invest a part of it (although cryptocurrency can be risky it really looks promising for the future).

The technology itself. I do think blockchain has so many advantages that I think a lot of companies will be interested to invest in and will use it for the future.

Power of the banks. Although banks claim crypto is a bubble, I don't trust them a lot. They have a lot of power and regularly they use it in the wrong way. Within cryptocurrency I believe people can control where and how much they can invest so you know what happens with your money.

This is obviously only one person's view, but I thought it summarized the issues with banks and centralization very well.

To summarize this section, in my opinion, Blockchain is developing from these three factors:

• The internet
• Centralization
• The ‘trustless’ world.

Blockchain: The Internet of Value

One way to look at Blockchain technology is ‘the Internet of Value’. The current internet focuses on transactions and data transfer. This is quickly progressing from ‘data’ into ‘value’ – our data is becoming ever more valuable.

Big data is a phrase used to describe the vast amounts of data that there is in the world. We interact with digital devices throughout the day, and these interactions are stored in data lakes, pools, and oceans. This data is often ‘owned’ by a large organization and can then be used to help offer better services, help find cures for medical conditions and be used to sell more products that you may want.

This data can also be used for marketing and advertising products to you, informing you of issues that may come up in the future and selling you products you do not need – data has become a blessing and a curse.

With Blockchain technology, you have the ability to ‘own your own data’ and use that to create value and transfer and transact value. Once you have control of your own data, you can decide what happens to this data and where it is used.

Data has become ‘value’ and that value is to you as an enterprise, person, or government. Using Smart contracts and other Blockchain technologies, this value can then be shared, reallocated, sold, bought, and generally used in a way that is much more flexible than today.

Importantly, with Blockchain technology, the Internet of Value is transparent and trusted – we will be able to own our own data (value) and do with it what we wish.

A very exciting and interesting new world of opportunities will emerge from the Internet of Value and the possibilities this opens for governments, business, and communities.

Blockchain has Five Important Characteristics

Let's now get into the basics of what is Blockchain – the best way to look at Blockchain technology is to look at the five most important characteristics:

1. Blockchain for truth and trust
2. Blockchain for transparency
3. Blockchain for security
4. Blockchain for quality and certainty
5. Blockchain for efficiency.

Let's explore these further:

1. Blockchain for Truth and Trust

One of the fundamental attributes of Blockchain technology is the immutability of the data – once the data is entered into the Blockchain (and verified) the data is there for eternity and cannot ever be changed, altered, or destroyed. Coupled with the decentralized nature of the Blockchain – where each party has the exact same copy of the data, this means that there is ‘ONE VIEW OF THE TRUTH’.

We are in a world that lacks trust in many ways – something that has crept in over the last 20 years, is now a major issue for governments and institutions.

Blockchain has taken a role in the ‘post-truth’ era to help solve issues around trusted parties – with Blockchain transactions and interactions being shared and immutable, so any issues down the line can be tracked and traced.

Blockchain records in time that a transaction took place – which can never be changed.

Now, we have to remember that Blockchain is a technology, and technology relies on its design and, most importantly, inputs. Blockchain will not solve the issue of mistakes and poor data – the data that is entered into the Blockchain could be incorrect, but the fact that it cannot be changed means this mistake can be found easily and the source of the incorrect information can be traced quickly.

2. Blockchain for Transparency

We live in a world of hidden data, processes, and technologies. Data on our lives is collected 24 hours a day – where we shop, where we eat, where we drive, where we party, where we work, where we enjoy life – and all this data is collected by many different parties, who use it in different ways and for different reasons – some of which we know and some of which we do not know.

If we apply Blockchain technology, we will have a transparent view of the data. Anybody who has access (on a public Blockchain this would be anyone, and on a private or hybrid Blockchain this would be who is authorized to access the data) can see what data is kept and what this data is used for.

The principle of open and shared data is key here. The data collected is clearly collected for a reason and...

Table of contents

• Cover
• Table of Contents
• About the Author
• About the Contributors
• Foreword
• Foreword
• Preface
• Introduction
• 1 Introduction to Blockchain Technology
• 2 Types of Blockchain
• 3 Enterprise Blockchain
• 4 What Does Blockchain Solve?
• 5 Blockchain Powering the New Marketplace Model
• 6 Where Can Blockchain Technology Be Applied?
• 7 Blockchain Adoption
• 8 First Use Cases
• 9 What Makes It Work? Blockchain Best Practice
• 10 How to Commercialize Blockchain/Reach Its Potential
• 11 Risks of Implementing Blockchain Technology
• 12 Blockchain Is Better When Used with Existing and Other Emerging Technologies
• 13 Future of Blockchain
• 14 Use Cases in Real World – 2019 Highlights
• Retail Blockchain Consortium
• Index
• End User License Agreement