Two years ago I couldn’t turn my ass in the supermarket, or someone was talking about Bitcoin and blockchain. Two years later, I no longer hear anyone outside of my filter bubble saying these buzzwords and it is only the fresh orange juice, talapia filet, and nutmeg that delight me with their immortalization on the blockchain. I still firmly believe that the technology is going to make a huge impact on our society, as I also predicted in my previous outlook blog last year. But the developments will go a lot slower as many people predicted last year when blockchain was awarded the ‘most overhauled word of the year’.
Research firm Gartner predicts that in line with their ‘hype cycle’, it will take at least another 5–10 years before the major implementations at companies will start to pay off. Only 10% of companies will start using the technology in the next 5 years. This will add $1 billion worth of value to the organizations that will use the technology in the upcoming year and, according to forecasts, even $ 3 trillion in the upcoming 10 years.
Wonderful, all the predictions, but what can consumers already do with technology as of today? What impact does it already have in the Netherlands and what can we expect in the coming months? Questions that I often get, when I speak or train about blockchain/crypto. Therefore in this blog, the 7 trends in the field of blockchain, which I expect in 2020.
Extensive Adoption by Companies
The many blockchain experiments that have been or are currently being carried out by organizations are being completed successfully more and more. In some industries, it even seems like a real challenge to announce the first new, cool and working applications; “FOMO Solutions”. Although many companies keep their successes secret, to stay ahead of the competition (confirms a round of calls with the larger advisory firms, assisting them), there are also plenty of companies that use it as a PR tool to show their innovative character.
Within the Dutch supermarkets, we have already seen the orange juice from the Albert Heijn, the talapia fillet from the Jumbo and the nutmeg from Verstegen being placed on the blockchain. The entire supply chain of the products has been made transparent, in order to meet the rapidly increasing concerns about food safety, the authenticity of food and conditions for employees and the environment in which the food was made.
The Dutch government continues to experiment at all possible levels and came up with various practical solutions, built with the technology. Earlier, I wrote about the Personal Bound Budgets, lampposts, parking functionalities and other things that are operating a lot more efficiently and error-free, because they make use of blockchain nowadays. The Dutch fine collecting agency CJIB will start using the technology to help debtors, by activating a financial ‘emergency stop’ for people who have fines they really can’t afford.
Different Blockchain Projects
Worldwide, interesting blockchain projects are piling up, from the various car builders who use the technology for, for example, verifying car parts and facilitating car parts, to soccer clubs such as Atletico Madrid and Jufentus, who have launched their own cryptocurrency for fans to invest in the club and give access to unique features. However, many adoption successes are not (yet) directly visible and visible to consumers, such as the efficiency gains that for example supermarkets Albert Heijn and Carrefour have achieved in their supply chain.
We are going to see a lot of great developments in the coming year because half of the companies now realize that blockchain is going to disrupt their industry and that it is a priority to take action on this. According to Forrester, the experiment phase is over and next year, the majority of companies will focus primarily on implementing the technology within the existing company.
Startup Showtime
They grew out of the ground like mushrooms and fell down by bushes; the blockchain startups that emerged at the height of the hype in 2017/2018. While searching for “the new Bitcoin”, billions of euros were invested in all kinds of startups, hoping that the price would, like Bitcoin and Ethereum, “moon”; increase hundreds of percent in value. Unfortunately; 80% of these startups turned out to be outright SCAMS and most other startups had to close down their operations due to mismanagement, no demand for the product or simply because they could not deliver the promised product.
Fortunately, the hype has finally come to an end, most unrealistic adventurers and short-term fortune seekers left the scene and serious startups are coming up with more and more special applications and solutions. There are a number of Dutch startups that have survived the “cryptowinter”, have meanwhile built on nicely and have already put the first working applications on the market.
Blockchain Network
Bitcanna, putting the global cannabis industry on the blockchain, launched its own blockchain network, token, wallet and is currently conducting the final tests to launch its full global payment solution for companies operating in the cannabis sector. In addition to the much-needed payment solution (many companies in the sector do not receive financial services and still largely work with cash), it also works on the transparency of the entire supply chain; “seed to sale” and a decentralized review option to prevent fake reviews.
Other cool companies that are currently making nice progress, are Safeguard, which reduces calamities within companies, Guts, which makes a great fist against ticket fraud and extortionate prices, Wordproof, which is ‘timestamping’ content at websites, to prevent abuse and CargoLedger, which digitizes and simplifies all administration related to ship transport. If we look at the public schedules of the different companies, there are many cool developments planned for 2020, which I will, of course, follow with great enthusiasm.
Impact Stories
Great, all those efficiency gains for companies and practical new applications for consumers; for me personally the most exciting thing about at Blockchain, is the real impact it has and can have on humans and society. No evolution, but real revolution. With all the negativity of failed experiments by companies, the inseparable connection that people still see with Bitcoin and all the negativity that surrounds it with price drops and use by the underworld, but especially also; the great ignorance about how it works, impact stories are very important in taking the next steps. In my opinion, they really demonstrate the right to exist in technology and provide the necessary support.
The World Food Program has “put” hundreds of thousands of refugees from Syria on the blockchain, making it easy for refugees to pay with a digital currency, virtually eliminating robberies and quickly and safely loading medical data into a hospital. And, The sale of goods via blockchain also ensures that stocks can easily be tracked and supplemented, that the payments cannot be fraudulated and that refugees can build a life again with their own digital ‘wallet’, in which money can be saved.
Remove Plastic Waste
The United Nations Children’s Fund, UNICEF, has already launched several projects and there are many dozens of projects using blockchain to remove plastic waste from the sea, clean rivers, reduce CO2 emissions, combat overfishing and provide basic financial services for people in developing countries to build an existence; offering a digital identity (1 billion people have no identity, with all its major problems) and banking facilities (nearly 2 billion people do not have a bank account, which means that they cannot save money for their children for example).
As with many companies, the many non-profits also show that there is plenty of experimentation being done with the technology and looking to 2020, these organizations are working hard on successful product launches and implementations for the wider public. It will, therefore, be a year of real impact on a global level, which will also lead to major breakthroughs within the non-profit sector.
National Crypto’s
Last year I already predicted, that governments would take major steps to set up their own, national cryptocurrency. Former IMF Director Christine Lagarde has previously called on central banks to explore the possibilities to do so, but Facebook has greatly accelerated this discussion with their announcement of Libra. Several countries have already introduced their own currency, such as Ecuador, Senegal, Singapore, Tunisia, and Venezuela, and countries such as Dubai, Ecuador, Russia, Estonia, are currently experimenting with it. In Germany, 200 banks have joined the lobby to introduce a digital Euro, and the recent announcement that even China is going ‘all-in’ with blockchain is certainly a sign that a digital yen is coming in the short term.
Many central banks admit that national cryptos are insurmountable because ultimately they want to keep control of the monetary system and prefer to take power away from banks. Where it is impossible to invite a representative of Bitcoin for a senate hearing or forbid the crypto, this is possible with Libra, which is currently being grilled by all possible governments and even banned in countries such as France and Germany.
In the coming year, we will see a lot of cool developments, especially in this area. As mentioned, China will launch its own crypto in the short term, we will see if the Libra will be launched as planned and, above all; what the effects will be of the introduction of all these own national cryptos. It is wonderful to see how countries circumvent the American sanctions with crypto, such as Venezuela and Iran, I am curious to see what further impact this will have on a global level.
Necessary Regulation
In my 2019 outlook, I already indicated that laws and regulations are essential in taking the next “quantum leap” by the blockchain technology. According to research by PWC, the great lack of clarity about and the lack of regulations regarding the technology is the biggest barrier for companies to start using it. This is mainly due to the “pacing problem”; the problem that making and / or adjusting laws can sometimes take years, while technology sometimes develops exponentially within a few months. For example, AirBnB grew from 20.000 to 80 million bookings in one year.
When the GDPR legislation was launched, it was outdated already, due to the rapid rise of blockchain (which in parts is at odds with this legislation). Former Dutch Minister Kamp already said that legislation ‘should promote digital innovation and not slow it down’, and my colleagues from the World Economic Forum also raised this major issue internationally.
Fortunately, many new laws and regulations have been announced for 2020, which will replace the old-fashioned rules for paper and mail with bits and bytes in various areas. In January, the Dutch Law on the prevention of money laundering and the financing of terrorism (Wwft) will be the first to be updated, bringing the various Dutch companies actively under cryptocurrencies under anti-money laundering supervision and thereby legally obliged to combat money laundering and terrorist financing (KYC, AML). In addition, various discussions are being held, about the rights and obligations surrounding the so-called “smart contracts”. Because what about bankruptcy and where do companies have to go? What about the rights and obligations within cross-border contracts? The much-loved GDPR legislation will also receive an update in the coming year, in order to embrace blockchain technology more than to oppose it
What Can We Expect More for Exciting Developments?
Developments for which I do not expect major breakthroughs in 2020, but which will see nice further developments, and which we should certainly keep an eye on, are “non-fungible tokens”, the “tokenizing” of assets and “self-sovereign identity”.
“Non-fungible tokens” are digital currencies with a unique feature. Every Euro is the same, but every dog is unique and therefore not freely exchangeable or replaced by an identical item. We saw precursors as “CryptoKitties” for digital cats and “Decentraland”. Many dozens of projects are currently digitizing a wide variety of issues; from collector cards from sports clubs to art, wine and won items within games.
One level deeper goes the “tokenizing” of possessions; the use of digital coins to indicate ownership. This makes it possible to change ownership, real estate, shares, gold, and other valuable assets within a fraction of a second. But also, the fragmented purchase of these assets, as the Dutch startup Bloqhouse already offers with houses. According to my colleagues from the World Economic Forum, no less than 10% of global GDP will be on the blockchain in 2027.
Self-sovereign identity
A “long shot”, but a really cool development, is the “self-sovereign identity”; manage your privacy yourself and fulfill all possible transactions with a single digital identity. Decide for yourself with which parties you share your identity data, to quickly arrange matters digitally or, for example, to prove that you are an adult when purchasing alcohol. For the Dutch government, it is the spearhead in the field of blockchain and dozens of startups are developing products. My Care Log is one of the first successful products to be launched, waiting for the next launch.
The planned developments alone will make 2020 a very interesting blockchain year. Of course, I am very curious about what else unexpected surprises will take place.
Jan Scheele is active in the web3 (blockchain, crypto, NFTs, DeFi) industry since 2013. Besides (former) CEO of a web3 scaleup and founder of an advisory boutique (working for governments, family offices and several multinationals), he is Digital Leader at the World Economic Forum and Board Member at the Blockchain Netherlands Foundation (BCNL). He is writing, consulting, speaking and training regularly about everything web3, all over the world. Furthermore, he is currently finalizing his book about the rise and global impact of blockchain technology.
