I’m sure most of you have the same burning question I do… When will the blockchain be adopted by the majority of businesses?
Well giving the answer up front, I would estimate that it will take 3-5 years for that to happen.
That’s around 5 years.
But what are the various challenges facing mass blockchain adoption by businesses? What the world will look like when the blockchain is adopted? The numbers provide some interesting answers to these questions…
The reasoning behind my estimate of around five years for the majority of companies to adopt blockchain is worth exploring further to truly understand where blockchain technology and business are going.
First, we need to define the ‘majority of companies’. That’s simple, it’s 51% or more of companies that are capable of using blockchain technology.
Second, we need to look at the main hurdles standing in the way of this goal:
Clearly, developing the actual blockchain technology for a business is just one small part of what needs to be factored in for an estimate.
There’s no way to sugarcoat it, there are hurdles businesses will have to overcome. And passing those hurdles will take time.
Training Blockchain developers… There’s a large financial incentive (blockchain devs get paid a lot) and learning to code doesn’t take more than 2 years in most cases.
Adjusting team and corporate culture and cohesive group work… This should take no more than a year in most cases.
Defining a business strategy for company-wide Blockchain usage… I estimate this won’t take more than 2-3 months, any motivated company can talk to existing blockchain devs about how the blockchain can help them.
Software development… Here things get tricky. There’s no easy “well gee that will take 2 years, one month and 19 days” answer to that. It will vary from company to company. So what we can do is look at the average from other industries that require challenging coding and do an estimate:
Testing the software after development… PC gaming software typically stays in alpha/beta for at most 1-2 years. Blockchain software will generally be simpler than that. So call it one year tops for blockchain software testing to full release.
So that’s how I arrived at my estimate!
Understanding the challenges that blockchain adoption faces AND what the future holds is crucial if we’re trying to determine the where and when of blockchain technology in business.
The biggest challenge by far. At present, bitcoin can handle 3-7 transactions per second. This is contrasted by something like a Visa credit card, which can handle 24,000 transactions per second.
On average a bitcoin transaction can take hours or even days, a visa transaction takes seconds at the most.
This issue applies to many other coins, not just bitcoin. It would likely also apply to blockchains developed for individual corporations. A universal “fix” for scaling is needed, especially for large corporations that intend to deal with a lot of customers.
Difficulty With Legacy Systems Integration…
You know the joke about the old-fashioned companies that still have computers running DOS?
At present blockchain technology struggles to integrate with older systems. So if you’re a corporation with 1,000 computers running Windows 7 you’re going to struggle with integrating blockchain technology.
Another challenge to the adoption of the blockchain, ironically, is cost.
Yes, it’s true that in the long term blockchain tech will save companies money and help them run faster and more efficiently.
In the short term however, since there are no one size fits all blockchain applications for companies, they’ll have to be custom built from scratch.
Another issue is that most blockchains are designed to hold their records publicly.
This is great for a currency or public database.
This is terrible however for a company that wants to store proprietary or private data on a blockchain.
Blockchains can be adjusted to be permissions based, but coding this properly will take time.
I believe we’ll be facing a very different world from the one we’re in today.
Imagine a future where each of the following is commonplace:
The list goes on and on.
I believe some very exciting times are ahead of us. If the blockchain fulfills its potential, it will change technology in many unexpected ways. Much like the internet did.
In 5 years we’ll know more about how big of an impact blockchain technology will have. Personally, I can’t wait.
I’ll see all you blockchain believers on the moon!
Will Salisbury is the co-founder of Blockchain Decrypted and full-time cryptocurrency trader. He also hosts the Blockchain Decrypted podcast, and when he's not talking or writing about blockchain technology and cryptos, he likes to play games and relax in his home state of Michigan.
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