Note from the Editor: This is the second of a three-part series where I’ve invited Guest Blogger Kurt Grela to provide a rebuttal to my claims that blockchain is a fad technology. This series will culminate in a live debate which can be found, along with my counter-points, on our page The Great Blockchain Debate of 2018. You can find part 1 of the series here.
In my last article, I discussed why blockchain technology is here to stay in response to my blockchain debate challenger Steve Palmer, who asked, “Blockchain the Next Great Technology Wave?”
Today, I respond to Steve’s latest challenge on how lobbyists will litigate on behalf of major corporations to prevent blockchain technology from taking over their businesses and markets.
So, is blockchain for everything? All I hear is blockchain this, and blockchain that.
Or is that only happening in my personalized newsfeed?
One of my favorite industry folks, Nic Carter, who is improving the space with Coinmetrics.io recently wrote an article, “Blockchain Is a Semantic Wasteland” with the subtitle: “Why haven’t we abandoned it?”
Need I say any more about the current state of using the word, blockchain.
Nonetheless, I think the term blockchain and the technology part are here to stay.
As I remember, I didn’t like the word internet or an emaildot.com format, but those stayed. In fact, that silly @ symbol and .com still remain too. Fortunately, the person who created http: or www said that wasn’t really necessary. That would have all saved us several keystrokes.
Even world famous investor, Warren Buffett, admitted he was wrong on Google and Amazon. 18 years later…right? So what?
In any case, back to blockchain. Is it for everything?
Yes and no.
I venture to say blockchain technology seeks to do what the internet could not.
“…cryptocurrency to tokenize real-world assets will ‘makethe web look like a cute experiment, comparatively speaking.’”
JeremyAllaire, Circle CEO
The internet didn’t really transform healthcare. Didn’t really transform legal services either. And, the internet didn’t really help send money around the world as email can.
Only recently in the United States, there is talk of same-day paycheck deposits. The culprit? The Wall Street Journal explains:
Despite lightning-fast tradingsystems that operate in milliseconds and billions of dollars being poured intofinancial-technology startups, the actual mechanics of sending and receivingmoney at a bank can be relatively slow.
Same-Day Paycheck Deposits Finally Arrive…40 Years Later.
“Can be relatively slow?” It is slow.
Then, there’s a Federal Reserve proposal for real-time interbank settlement of faster payments. Call it 24x7x365 banking for banks.
We all would agree: “A 24/7 economy with 24/7 real-time payments needs 24/7 real-time settlement,” said Fed Governor Lael Brainard.
Both are remarkable improvements. Yet Europeans find it absurd Americans can’t transfer money for free, same day.
We will get there.
How will blockchain technology transform these industries? In the dot.com days, we explained it as the Old Economy vs. New Economy. The old economy companies would slowly fade away.
In 1999, I thought Amazon would destroy bookstores, shopping malls and retail, yet many people continue to shop on-location almost 20 years later. Sure, a few bookstores are out of business, malls are struggling, and Sears filed for bankruptcy last week, but I expected this to happen 15 years ago. Even today, not everyone has an Amazon Prime account.
I am usually an early adopter and several years ahead…sometimes 5-10 years early.
The U.S. government is even making strides in blockchain technology. I saw a presentation last week from a government official. It’s about data management, process efficiency, legacy systems, and real-time access to decision making. All thanks to blockchain and other emerging technologies.
All you have to do is read the title: HHS acquisition expert to blockchain doubters: ‘You are very close to being irrelevant’.
Project name: HHS Accelerate.
HHS is an acronym for the U.S. Health and Human Services where the acquisition process takes 200 days (more than half a year!). The team is looking to reduce the cycle time by more than half!
Yes, entire job functions will no longer be needed. Is that a concern? Yes, if you want to keep the same job for the rest of your life, but no one does, especially if you are doing the same thing over and over again.
The world moves forward by automating repetitive tasks or phasing out products that shouldn’t be produced anymore.
About a third of future jobs in 15 years don’t even exist yet today.
Why is HHS Accelerate such an important effort? The agency manages billions of dollars in taxpayer money for health services. Cost savings would benefit everyone, especially the patients that get served.
Can other U.S. government agencies benefit? Yes. The U.S. Air Force, U.S. Army, Department of Commerce, and the U.S. Agency for International Development have all expressed interest. At the very least—a demo of what HHS is piloting.
The expected return on investment for the $3 million dollar pilot project? Possibly a 800 percent return in four years!
What about legal services? Well, you have heard about smart contracts …right? Well, if many of the terms and conditions are standardized, why not automate and configure them?
How about automating legal forms? The website DoNotPay for parking tickets recently created a bot to sue anyone in the United States. No blockchain required.
Yes, no blockchain required.
In all seriousness, automating, managing, and configuring smart contracts might actually require more legal experts. Just the process is optimized for performance.
With IT systems, jobs would be all automated away…right? Well, not exactly. There must be more people working in IT than ever.
While blockchain is not for everything, I do see it doing things that internet could not. It’s already providing pressure for banks to upgrade services to real-time. For healthcare, what will it take to get rid of the fax machine? For legal services, I suggest there will be more legal folks than now – even though we have smart contracts. We’ll need legal folks to program those smart contracts. Overall, with such a young technology, I am probably underestimating the transformative nature of the blockchain revolution.