What are the Best Blockchain Adoption Strategies? (E-Crypto News Exclusive Interview)
The world’s first blockchain was introduced a decade ago. Since then, the adoption of blockchain technology has occurred at snail’s pace. E-Crypto News spoke to some experts about the best blockchain adoption strategies. Here is what they had to say.
Aubrey Strobel, Head of Communications at Lolli
“Like the internet, blockchain technologies should allow people to use it without having to understand it. We need to provide the benefits of decentralization while masking the complicated network underneath – when the tech matches the convenience of legacy systems people will naturally incorporate it into their everyday life.”
John Deacon, Financial Services Lead at Dragon Infosec Limited
“Despite much publicity, blockchain has not yet achieved the level of industry penetration previously anticipated. This is perhaps due in part to the fact that existing blockchain solutions often do not deliver on the real world performance metrics that users care about – speed, cost, scalability and resource usage. In order to convince the market to switch solutions, you need to demonstrate the clear superiority and ease of implementation of the new solution, which has driven the Temtum Group’s advanced blockchain product – the Temporal BlockchainTM. This innovative technology can provide what we believe to be the fastest, cheapest and most secure network solution, with massive scalability and very low energy costs. The light-weight protocol can also ride on existing networks if desired, minimising implementation costs and disruption.”
Sukhi Jutla, Co-Founder and, COO at MarketOrders
Here are my top tips on creating a blockchain strategy:
1. Ensure there is a shared understanding of blockchain within your business and team who will execute the project so they have an understanding of how the technology works. Know what it can do and it’s limitations. This will also help to get management buy-in and support from stakeholders.
2. Define the problem – you don’t want to be boiling the ocean as results will be difficult to quantity. Instead, take time to identify a specific business area or process where you think blockchain could create benefits such as increases efficiently or better transactional performance.
3. Build a Minimal viable product – prototype your idea using minimum resources and in a short time frame. This will allow you to build something fast and not waste months on something that may fail. This MVP will also help to identify if you have created the right solution to the right problem
4. Identify where you may have a skills gap in your team and recruit the right skill set to help you build your solution
5. Once you have a solution that works you can then start to think about scaling this to other areas of your business.
David Waslen CEO and Founder of HedgeTrade
Any time you can demonstrate how blockchain technology solves a recurring issue in current systems and businesses it will help push adoption. It’s easy to talk about all the good that blockchain technology can do, but what really sells, is seeing the technology in action.
Incentivization is one factor that helps blockchain companies draw in people to actually use their platforms. Using tokens for promotions, bonuses and contests, for example, is a common tactic that gets people using a platform, following a company social media channel, or engaging in any number of tasks created for token rewards for those who perform those actions. Then once they are in, they can then learn more about the blockchain use-case and experience the technology firsthand.
For example, at HedgeTrade, we like to use tokens in promotional ways that benefit the users of our social trading platform. They get rewarded a little for engaging with our platform, which helps the project move forward as we assess milestones along the way. Then once they are using the platform, they learn that we use blockchain technology to provide transparent and immutable track records for trading predictions. It helps our users, it helps us, and it helps the platform as a whole to strengthen and grow. We often will collaborate at the same time with an industry partner (such as an exchange) to expand both of our audiences, build momentum, and bring useful ideas to more people. We’ve found this strategy of combining engagement promotions with collaborations to be effective in growing our user base and platform thus increasing blockchain adoption.
About David Waslen
David Waslen is CEO and Co-Founder of HedgeTrade, a blockchain-powered financial application for social trading based out of Singapore, Canada, and Europe. A graduate from London Business School and Dartmouth College, David has executive experience in corporate finance, venture capital, and private equity. His expertise lies in building out the next generation of FinTech products with a focus on software and analytics platforms that enhance trading performance and efficiencies for retail customers, high-frequency traders, and institutions alike.
Douglas Horn, Chief Architect at Telos Blockchain
Early attempts at adoption saw the industry putting “blockchain” in the headline (often in all caps with an exclamation point) when it’s probably best as a footnote. In most ways, gaining adoption for blockchain technology is like gaining adoption for any other new technology. Aside from industry insiders and aficionados, people really don’t care about the gee-whiz new tech—in fact, many view it with suspicion. What people care about is what the technology can do for them.
To increase adoption, the industry needs to stop thinking that blockchain is a selling point that anyone cares about for its own sake and focus on the fundamentals of demonstrating real advantages in things that people care about today. Saving people time, money and hassles is always a good place to start. Once you impress people about these savings, you can have the footnote that blockchain empowers all of this.
Blockchain tech has the thrilling ability to do things that have never been done before and that gives a lot of us in the industry exciting ideas about how to reshape society. But these blue sky approaches are less thrilling to people just learning about the technology. What they really want is a better way to do what they are doing every day. Focusing on blockchain solutions that tackle everyday challenges and speed them up, cut costs or increase convenience are likely to find better adoption than amazing solutions for problems that don’t yet exist or aren’t generally recognized.
Imagine if Amazon.com had pitched Amazon Prime, its video streaming and free shipping subscription service, back when it was just starting out. Few people would get it. Back then, it was enough of a struggle to get people to just buy books online. Ultimately it worked out because Amazon offered a faster, cheaper, and easier way to buy books in one place. Its later services evolved from there. For blockchain to find the same kind of adoption as online retail, it needs to address existing problems with solutions that are better right now. Odds are, these may appear a bit boring compared to flashy, futuristic offerings.
One of my favorite new dapps coming out is Qubicles.io—a platform for sharing resources between call centers that have too much work and those that have too much staff. This load balancing is a real problem in the contact center business and Qubicles has a solution that saves money, time, and hassle. They are deploying on the Telos blockchain, but that isn’t a leading sales point for them, they talk about savings and convenience. Qubicles is fabulously boring in that it will use blockchain technology to solve real problems for an industry that few people know or think about. But by cutting downtime and better managing staffing, it will solve a real problem for that industry and will save it money. No one will care much that it’s blockchain that enables this.
Another important strategy to drive adoption is to change dapp interfaces so they hide the blockchain elements that until now have been very much front and center. Address and key management is a challenging part of dapp interfaces for new users. As blockchain interfaces advance, they need to become more invisible and provide additional protections against key loss if they are to attract and keep mass market users. A number of auth and sign-in services can now manage keys for signing dapp transactions. Some of these may trade a measure of security for recoverability at least until users feel comfortable enough with key management to accept the responsibility directly. Expecting mass market users to accept irrecoverable account losses as a part of blockchain acceptance is ridiculous. They will not. Instead, dapp developers will need to find ways to help make accounts recoverable.
At Telos, we are putting these approaches together to make a friendlier platform for dapps and mass adoption. We are making our interfaces easier to use. Address abstraction and easy account names mean that dapps can help streamline this process for users and provide methods for key recovery or replacement. We are also focusing on real solutions to existing problems. One problem we’ve identified is voting and governance of groups like homeowners associations, clubs, unions, and similar organizations. At present, voting is an expensive for organizers and an opaque and inconvenient process for members. Our Telos Decide™ governance engine greatly simplifies this and improves transparency, cost, and convenience for organizations and their members. We are regularly working on better interfaces to make the blockchain element of the platform unthreatening and as easy to use as any other mobile app. We think that simplifying the blockchain elements and maximizing the user benefits are great approaches to bringing mass users to blockchain tech.
Professor Hemang Subramanian, Department of Information Systems and Business Analytics. College of Business at Florida International University.
What Are the Best Blockchain Technology Adoption Strategies?
Technology Adoption per-se has many strategies. First and foremost, seeding the innovators (or early adopters). Secondly, through word-of-mouth or network effects bringing in connected “followers” if the technology makes a difference. Thirdly, the mainstream adopters will adopt upon the network of adopters reaching a critical mass which varies between 7% and 12% of the total number of adopters possible in the future.. In Information Technology research, this is known as the “Adoption curve”. I have modeled this adoption curve for novel Blockchain networks such as Steemit.com – which rewards bloggers and blog reviewers in cryptocurrency( Steem). What we see here is that the early adopters or the innovators, stop contributing (and possibly get disillusioned) quite soon, because of many reasons e.g., the payments by the network does not meet their expectations.
Blockchain as a technology has seen rapid adoption in several sectors such as healthcare, supply chain and logistics – but finance is the sector in which blockchain technology is having the highest impact. Scholars (my peers) have published several papers on whether a firm should adopt Blockchain – if at all, and how business processes can benefit, if such a decision to adopt is made. Not all is hunky dory though – there are several challenges that business processes face while migrating legacy centralized applications to the decentralized blockchain framework, and these too have been highlighted by several researchers in information systems and operations management.
On the overall, there is no single silver bullet answer to this question. Adoption of the Blockchain technology – different than cryptocurrency adoption – is no longer a big challenge provided firms and businesses really know what to use blockchain for, and how to use blockchain to improve some aspect of their business.
- There has been a lack of fervor as regards the adoption of blockchain technology. What are the best strategies that could be used as regards blockchain technology adoption?
This is not entirely true. For example, if you look at the Fortune 100 technology companies, each of them has a significant investment in blockchain. IBM/Google/Facebook/Microsoft/
Amazon – all of them have significant investments, product lines and services for blockchain. It is not visible entirely to the outside world, because blockchain has become a part of the standard distributed infrastructure in most of these firms. Similarly, large banks use blockchain infrastructure, not to mention the growing clout of decentralized finance (defi). I have blogged about several interesting industry standards being set in defi at http://www.cryptonewtech.com
- How can blockchain projects convince people that their technology is better than what they are currently using?
There are several factors for blockchain projects to convince people.
- Technology differentiation – why and how is their technology different than existing state of the art platforms?
As a start, do they solve the blockchain trilemma – if not their blockchain is a glorified prototype (https://www.cryptonewtech.
com/2020/02/22/algorands- solution-to-the-blockchain- trillemma/)
- Network effects – how large is their network of adopters i.e., users. If it’s a new technology – then what is the scope of their network i.e., how much can they scale, how fast will their transactions be, what will be the rate of their transactions, etc. For example, Bitcoin’s ecosystem has six different stakeholders or sides for the platform i.e, core-developers, application developers, exchanges (and bridges), miners, network node maintainers and users (people who hold bitcoin and use it for transactions). In addition there are mining equipment manufacturers, point of sale transaction systems, ATM machines, peer-to-peer trade facilitators, etc… It takes time to grow the network of users for each side of the network (i.e, for each stakeholder). New blockchains need to develop this entire network for each side diligently, and this takes time.
- Ease of integration with existing business processes – This is a very powerful factor when firms consider adopting a blockchain for its internal or external business processes. Does the blockchain support easy integration right away into its business processes? Does the blockchain provide a pathway to learn its smart contract programming interface so that people can write code and transform existing business applications onto it?
Several new languages such as RUST, GO, SOLIDITY, JAVA-script based libraries such as web3.js, etc are readily available and industry standards. So firms that build blockchains have to manage this compatibility.
- Availability of Architects, Business Developers, and programmers –
Jimmy Nguyen, Founding President, Bitcoin Association
The biggest problem seen to date in the adoption of blockchain technology can be attributed to a lack of scaling. Businesses have yet to widely adopt blockchain technology because virtually all blockchains have failed to successfully scale to meet the needs of major enterprises. Big businesses – such as an Amazon or Apple – will only build their applications on a blockchain if the network can handle high transaction volumes and provide greater data capacity, all at fast speeds and with low transaction fees. Ethereum ran into scaling problems, and that’s why it has had trouble onboarding new businesses in the past year. Until the emergence of Bitcoin SV in November 2018, no blockchain possessed the ability to scale to support the needs of major enterprises.
Another problem is that there are now too many competing blockchain and distributed ledger projects, making it difficult for businesses to choose which is the best platform to build upon. Imagine if there were 100 or 1,000 competing Internet protocols; we would not have the efficiency of today’s single global Internet. Just like with the Internet, it’s better to have one global public chain that has the scaling capacity to serve all of the world’s businesses and users. Enterprises can then focus on building technology for that one blockchain, rather than wasting time on different systems. Businesses and consumers also gain interoperability efficiencies from having just one blockchain for digital currencies and advanced data applications. That’s why we are building Bitcoin SV for the vision of “One World, One Chain.”
But even with scaling and a dominant blockchain, blockchain technology will only lift off when there are applications that are useful to businesses and consumers alike. Remember what a blockchain is – a publicly accessible, distributed ledger for recording data, fused with a token that has monetary value. Enterprises and developers must focus on creating applications that leverage the unique capabilities of the blockchain to make transactions and processes more efficient, or provide users with new functionality they cannot otherwise do. For example:
Tokenize less-liquid assets – which could be as varied as customer loyalty programs to fractional interests in real estate – and make them more easily tradeable than in the “real world”
For industries where data is typically separated into silos (such as health care and supply chain management), create greater system efficiencies by developing applications that record data to a single public blockchain and provide real-time access to all relevant players in the ecosystem anywhere in the world
Create smart contracts that automate discrete, repeatable business transactions
Help consumers store and own their own data on a blockchain, while also enabling the user (as well a supporting business) to monetize that data with micropayments
These are just some of the possibilities that could be achieved with blockchain technology – but all of this requires a blockchain with massive scale to provide the infrastructure of a single global data ledger. The only blockchain on which that is possible is Bitcoin SV.
Jimmy Nguyen is Founding President of Bitcoin Association, the Switzerland-based global industry organization advances the Bitcoin SV digital currency and blockchain. A well- known advocate for Bitcoin, Jimmy was most recently the CEO of nChain – the global leader in research and development of enterprise-grade blockchain solutions. Previously, he had a 21-year career as an intellectual property and digital technology lawyer, and was a partner at three major U.S. law firms.