Blockchain – the technology that gave birth to the renegade digital currency bitcoin – could be pushed out of cyberspace and into the real world in 2017 by the wave of anti-establishment sentiment sweeping the Western world.
some big backers who have risen to prominence partly because of their rejection of traditional power structures – like bitcoin itself, have been attracted to the blockchain technology which allows the web-based currency to function.
With those outside the realm of finance expected to grow most, they are now looking at a wide range of new uses for the technology.
For example, blockchain is being demanded to be used in streamlining public services by Italy’s biggest opposition group, the 5-Star Movement. And there are a number of enthusiasts for the technology in the inner circle of the United States, President-elect Donald Trump.
Experts caution that some blockchain projects will never work and say that much like the early days of the internet, this technology still needs several years of experimentation and development.
Nevertheless, the very establishment that early supporters hoped it would displace is also jumping on the bandwagon in an ironic departure from blockchain’s libertarian origins.
To enhance efficiency of the likes of transacting cross-border payments, issuing debt and recording health data, many of the world’s biggest banks and corporations are trying to harness the technology. Even keen to get on the act is Britain’s Conservative government.
Through a peer-to-peer computer network and with no need for a third party, blockchain allows for transactions and data transfers to be completed in seconds. And hence parties such as the central banks that issue traditional currencies and who distrust established authority have been attracted.
While bitcoin outperformed all conventional currencies in 2016, Iceland’s joint second-biggest party – Pirate Party, wants bitcoin accepted as legal tender.
In the past year disgruntled Britons rejected the European Union, Italians brought down their prime minister and Americans elected Trump and blockchain reflects the spirit of the past year notwithstanding the corporate interest.
“A global and open blockchain … lends itself very well to current anti-establishment sentiment,” said Jon Matonis, an economist and founding director of the Bitcoin Foundation. “The general theme is removing the role of a third-party auditor or enforcement agency.”
Still, seeking ways to reduce costs and cut the time it takes to settle transactions, it was the financial services industry that moved fastest on blockchain development in 2016.
And expected to move from the laboratory and into operation this year are some of these applications. But analysts and experts expect that other sectors, both public and private, would likely find new “use-cases” via which they can adopt the technology in 2017.
“You’re still going to see more and more use-cases and resources being put into financial services, so that pie will still grow. But a larger percentage of use-cases … will be non-financial,” said Nick Williamson, CEO of Credits, a London-based blockchain infrastructure provider.
For improving transparency and accountability in public services, countries were looking at using blockchain, Williamson said. Whether it could help to track and distribute welfare and pension payments, for example is being examined by the British government.
(Adapted from Reuters)