Will Blockchain change the world?

Thus, the blockchain becomes a massive digital record that is updated chronologically and archives transfer activities within a network of participants - cryptographically sealed. Unlike conventional databases, the blockchain is not located on a single server, but all participants in the network have a complete, 100 percent identical copy of the entire blockchain in their local storage. The accuracy of the stored data is verified by defined reconciliation mechanisms. All transactions between participants do not require trust-building intermediaries such as banks, notaries or states; the resulting automation of business processes leads to time and cost savings.

The best-known and first application of a blockchain is the cryptocurrency Bitcoin. A person or group with the pseudonym Satoshi Nakamoto had developed the software for it in 2008. In the meantime, countless other applications of the blockchain have been discovered and marketed. Starting with the financial services sector as a pioneer, other industries are now following suit. Blockchain makes it possible to conduct business without the need for intermediaries, through peer-to-peer transactions and automated via so-called "smart contracts." As a result, many processes that cross corporate boundaries, such as securities trading or trade supply chains, can be revolutionized. Prominent blockchain projects include the Blockchain Insurance Industry Initiative (B3i), Maersk and DNV GL, which are using blockchain to make processes more transparent, efficient and secure in their respective industries of insurance, trade logistics and certification.

What does blockchain mean for companies?

The first experiments and applications with blockchain show: the technology will fundamentally change many business models. Previously assumed prerequisites or obstacles will have to be rethought for existing industries. This can be seen especially in the area of collaboration: where a company has traditionally worked for itself to the exclusion of its competitors, Blockchain calls for collaboration between companies. Large blockchain consortia have already formed, such as the Energy Web Foundation in the energy industry or MOBI in the mobility sector. In the future, new business models will increasingly take place in networks instead of within individual companies or fragmented platforms.

Challenges in the development of blockchain applications

Companies are currently in the phase of identifying the potential of blockchain technology for their own business models and piloting initial applications. However, there are still a number of hurdles to overcome before these can scale and the technology can have its full impact. In the technology space, there are some uncertainties around platforms, scalability and security. Different blockchain platforms offer different approaches to the issues of scalability and security. However, there is not yet a consensus or general preference for a particular blockchain platform, making interoperability an important consideration for enterprises. On the legal front, market participants are also still awaiting regulatory guidance and landmark rulings. An international legal and regulatory framework will further fuel the development of blockchain applications.

The future of blockchain in enterprises

Blockchain is, of course, not a panacea for all challenges in the market. Nevertheless, blockchain is an emerging enabling technology that carries immense disruptive potential. Decision-makers in companies in all industries and business areas should therefore start looking at the possible areas of application for the technology now in order to potentially achieve more efficient processes and not be surprised by new business models. The recommendation in the first step is to hold a discussion about the strategic orientation with regard to blockchain. The resulting impact analysis on the business model and the definition of options for action are a solid basis for not only identifying initial use cases for one's own company, but also implementing them successfully. This requires the sustainable development of internal capabilities and the involvement of the necessary stakeholders. To this end, a functioning internal as well as external ecosystem must be created for every blockchain initiative, as the exchange of ideas, opportunities and models is essential for the successful use of such a young technology. Cross-company/ cross-industry cross-fertilization follows an original blockchain principle and thus may represent another non-technological revolution in the collaboration models of our economic system.