Is Blockchain Really Worth The Investment?

2017 was the year of blockchain and cryptocurrencies. These new technologies generated a lot of excitement among the tech community, and other industries, courtesy of its potential capabilities and early results.

But, for a technology whose main achievement for now, is the spawning of tokens and cryptocurrencies, there’s the question of legitimacy and the possibility of hype.

With more companies jumping on board the tech, there’s the question of returns. Is the powerful technology really worth all the time, and resource, currently being spent on it?

This is why companies and organizations need to truly evaluate if the technology is useful for them, and more importantly, worth the investment. This makes sense because at the end of the day, successful businesses pay a lot of attention to their ROI.

In an effort to help business owners and executives determine if an investment in the blockchain tech provided by IBM is capable of yielding significant returns, a Forrester Total Economic Impact study was launched.

Clients were interviewed about the tech as well as their cost implications, and their impact of the client’s business processes. The study which also featured Forrester Principal Analyst, Martha Bennet, saw clients outlining their unique challenges with the technology as well as their expected outcomes.

Most of these clients actually aspired to be pioneer blockchain tech adopters in their industry, and hoped that the technology would help drive business processes more efficiently.

The study, which was carried out during a webcast required participants to answer certain important questions, all of which were to help them understand the role that blockchain plays. While there were lots of answers, two things became increasingly clear:

So, IBM decided to help clear some of these perceptions by providing the right perspective and clearing the wrong perceptions. Some of these include:

Blockchain is currently been promoted as a fix-all solution to many business’ problems. But the reality is its functions and solutions, while broad, aren’t all encompassing. Therefore, the technology should be seen as a tool that solves specific problems.

So, smart business executives would have to assess their business problems, and decide which problems blockchain can actually help solve. This will help clear up the confusion, providing an insight into just what its potential ROI can be.

Right now, blockchain does an awesome job of improving trust between multiple entities. As a result, businesses can hope to get the following benefits from its adoption:

A successful use of blockchain in improving business processes and efficiency is seen in Walmart’s use of the technology to improve food tracking, through its blockchain-based supply chain tracking system.

While there are quite a few, none is as important as the edge it has when it comes to enhancing trusts between multiple parties through the immutable ledger of transaction data with zero point of failure.

Courtesy of its distributed ledger, which relays the data to all parties, it’s difficult for any party to alter the data. As a result, its data integrity is incredibly secure and safe.

Blockchain’s scaling problems are usually due to multiple factors. But the most important seems to be the network architecture and their permissioned or permissionless state.

Reports have indicated that permissionless blockchains such as those powering ethereum and bitcoin can only process tens of transactions per second, while permissioned blockchain networks can process thousands of transactions per second.

As a result, IBM has built its own blockchain service on the Hyperledger Fabric framework, which is also a permissioned blockchain.

This blockchain is known for its ability to process thousands of transactions per second and is capable of deploying peer on the cloud and on hardware. This way, scaling is pretty easy and swift when necessary.

Businesses looking to for a blockchain solution are bound to consider either creating a new one from scratch or join an already existing one. There are factors that can influence this decision. For instance, you have to think about network participants, cost of development, business operations and rules of governance.

The truth is that while there are few advantages to being involved in the early stage of development, the reality is that these can require considerable time and resource investments –two things you probably don’t want when you’re in a hurry and need the solution immediately.

Joining already existing blockchain networks gives you the advantage of instant deployment and even the possibility of improving on the current network.

And it’s cheaper, less time consuming and has the added benefit of being already tried and tested. This makes it incredibly easy for nay business entity to get om board and start utilizing those solutions for themselves without worrying if it’ll work or not.

As you can see, these are all pertinent questions that most business executives have when they’re considering blockchain solutions and options. Now that you understand them, you can correctly ascertain if blockchain is worth the investment for you. And if it is, you’ll also be able to properly determine what kind of solution or network is best for your business.

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