Blockchain is here. What’s your next move?

PwC’s Global Blockchain Survey 2018

Bitcoin was released in 2009 as a digital currency system via a simple posting to a niche mailing list. Over time, interest has grown not only in the digital currency, but also in the underlying blockchain and distributed ledger technology. This interest has morphed into a global movement that, according to the World Economic Forum, will become the ‘beating heart of finance’ within five years. The underlying technology has the potential to transform not only each industry that it touches, but also the internet itself by bringing in a level of security that is clearly needed. So, what does this technology mean to us in industry and specifically here within the Channel Islands?

84% of respondents say their organisations have some involvement with blockchain technology

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How far along are companies with blockchain?
Blockchain project stage: None - Research - Development - Pilot - Live - Paused (7%)

Signs of the new blockchain world

Tokenised everything

The representation of real or virtual assets on a blockchain is spreading to raw materials, finished goods, membership rights, and more. These digital tokens will transform company processes and usher in new business models.

ICOs are self-funding the tech

Initial coin offerings, in which a company sells a predefined number of digital tokens to the public, are a growing alternative to classic debt/capital funding. They’re raising billions of dollars for the development of blockchain technology platforms.

ERP + blockchain

Enterprise software platforms that are the engine for company operations like finance are beginning to integrate blockchain. Using blockchain with their ERP systems, companies can streamline processes, facilitate data sharing, and improve data integrity.

New leaders emerge

Our survey respondents still perceive financial services to be the current and near-term future leader of blockchain, but other industries are on the rise (see left).

Is blockchain right for you? If your project checks four out of the six boxes, blockchain could be an applicable solution: Multiple parties share data; Multiple parties update data; Requirement for verification; Intermediaries add complexity; Interactions are time-sensitive; Transactions interact

Which industries are seen as leaders in blockchain

Financial services - 46%; Industrial products and manufacturing - 12%; Energy and utilities - 12%; Healthcare - 11%; Government - 8%

Which territories are seen as blockchain leaders — today and tomorrow

US: 29% in 2018, 18% in 2021-2023 projected; China: 18% in 2018, 30% in 2021-2023 projected

It’s hard to trust blockchain

By design, blockchain can foster trust. But in reality, companies confront trust issues at nearly every turn. 45% believe lack of trust among users will be a top barrier.

How to overcome the trust barrier

Blockchain’s trust paradox is a significant, but not insurmountable, challenge. Here are four strategies for navigating this new world.

Make the business case

Strategic clarity will ensure your blockchain initiative has a business purpose around which participants can align.

Build an industry ecosystem

Blockchain may call for competitors to collaborate in a new way, as they come together to solve industry problems.

Design deliberately: determine rules of engagement

Every blockchain will require rules and standards, particularly around how participants will access and engage.

Navigate regulatory uncertainty

You’ll need to stay agile to meet regulatory requirements as they evolve in the years to come.

Contact us

Nick Vermeulen

Partner, Innovation & Technology, PwC Channel Islands

Tel: +44 7781 111526

Steve Davies

Global Blockchain Leader, PwC United Kingdom

Tel: +44 (0) 131 260 4129

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