Monday begins Blockchain Week in New York centered around CoinDesk’s Consensus 2019 conference. My takeaway on the current sentiment? The crypto spring may have begun; but for blockchain in the enterprise, it’s becoming summertime.
Don Tapscott is co-founder of the Blockchain Research Institute and co-author of “Blockchain Revolution” with Alex Tapscott. Disclosure: He owns Atoms.
Over the month, there has been a flurry of activity – from partnerships and plans to pilots and full-scale deployments – among some of the world’s leading enterprise.
Ten events, in particular, demonstrate just how much innovation we’ve seen during May, a time I think merits the moniker the “Month of Blockchain.”
1. Central banks are breaking new ground
At the end of 2016, we predicted that a major central bank would test a digital fiat currency in the next year. None did. Though central banks explored the use of blockchain more enthusiastically in the years since not one of them conducted a major pilot.
Then, in late April, the Bank of Canada and the Monetary Authority of Singapore announced their success in completing a digital currency swap using blockchain. While both had been experimenting with domestic payments, this marked the first such endeavor for payments across borders – one small test for the two central banks, and a giant leap for central banking as a whole.
2. FedEx shares strategy for blockchain in logistics
Also in April, we hosted the inaugural Blockchain Revolution Global, a conference focused solely on enterprise blockchain. There were a number of highlights, but among the most exciting was FedEx CIO Rob Carter and FedEx Logistics CEO Richard Smith detailing FedEx’s uniquely collaborative and notably enthusiastic approach toward blockchain in transportation.
“Rather than focusing on competitive advantage, FedEx is focused on how we can leverage our industry leadership to foster innovation and collaboration among our peers,” Carter wrote in a summary of our discussion.
That same day, we hosted the very first panel featuring leaders from the big three — FedEx, DHL and UPS — to discuss the importance of developing standards for blockchain. Carter even went on to call on governments to play a more active role in mandating blockchain and building those industry standards.
3. Pepsi improves digital ad efficiency in a blockchain pilot
In 2017, over $200 billion were spent on digital advertising worldwide, but concerns over wasteful spending have caused some of the world’s largest spenders to scale back. Food and beverage giant PepsiCo made its own leaps in blockchain, focusing on this often-overlooked application of digital marketing. The results of PepsiCo’s pilot project incorporating blockchain into its digital advertising demonstrated some remarkable results, with a 28 percent improvement in advertising efficiency.
The pilot used smart contracts to reconcile data from multiple sources in PepsiCo’s advertising supply chain, creating a single version of the truth over an ad’s effectiveness.
This transparency should help to ensure that PepsiCo pays for ads only in environments that are brand safe, visible, and free from ad fraud.
4. Starbucks moves forward with ‘bean-to-cup’ blockchain
It’s been nearly three years since Walmart and IBM conducted their groundbreaking pilot using blockchain to trace pork and mangoes from farm to fork on Hyperledger. (IBM has subsequently announced it has over 130 production networks in operation.)
By providing a single, secure digital ledger to record information, collecting data on the provenance of these products now takes seconds, not weeks. Since then, hundreds of the world’s largest companies – from aerospace and automakers to diamonds and defense – have begun using blockchain to trace the source and track the custody of their products.
Now, the world’s largest coffee chain is using blockchain to track the source of each cup of coffee. Just last week, Starbucks announced its work with Microsoft’s Azure Blockchain Service to allow customers to trace the journey of their coffee, from one of 380,000 farmers to the barista.
The project, it is hoped, would build more consumer confidence in the sourcing of Starbucks’ coffee, while generating potential financial rewards for farmers down the supply chain.
5. JP Morgan ramps up Quorum blockchain platform
JP Morgan Chase’s revamped its blockchain platform, Quorum, in a big way, after the banking giant announced a new partnership with Microsoft Azure Blockchain.
The partners have quietly remodeled the platform over the past six months to improve security features and make it more accessible to a large array of businesses. With this new partnership, JP Morgan has laid the groundwork for a potential spinoff from the bank.
With 220 banks signed up on JP Morgan’s Interbank Information Network, and massive projects such as energy trading platform Vakt already running on Quorum, this recent announcement has injected new life into the bank’s blockchain project.
6. VW begins using blockchain to source cobalt
The automotive sector has been the focal point of innovation in everything from artificial intelligence and machine learning to the Internet of Things. In April, Europe’s largest auto manufacturer, Volkswagen, announced a first crucial step into the blockchain ecosystem.
Working with IBM, VW will join others like the Ford Motor Company in tracking the source of cobalt using blockchain. Using blockchain, VW and others are hoping to ensure the cobalt used in their car batteries is mined using only ethical labor practices.
7. Facebook ramps up blockchain adoption
The buzz over Facebook’s potential plans with the new technology has been swelling for some time now. In the last month, it has become something of a roar, with reports that the social media giant has been approaching venture capital firms with plans for a new cryptocurrency and mobile payments system.
Facebook itself has remained notoriously quiet about its plans, but a recent report from Bloomberg revealed that the project itself will be a stablecoin – a crypto asset pegged to a certain value.
No doubt, this innovation would have enormous implications not just on the payments industry, but on the entire state of the Internet as we know it!
8. Amazon releases Managed Blockchain service
Not to be outdone by one digital conglomerate entering the blockchain space, Amazon Web Services recently made its Amazon Managed Blockchain generally available. The product essentially allows businesses to connect various AWS accounts as nodes in their own blockchain network, while Amazon oversees the various software and network settings required to manage and maintain the network.
The process for building a blockchain network is currently quite arduous, which has limited a lot of blockchain applications to large enterprise. This new service could have a profound impact on small and medium enterprise looking to leverage blockchain to improve their transaction speed.
9. Microsoft unveils full Azure Blockchain Service
The very same week Amazon released its Managed Blockchain, Microsoft responded by unveiling its full Azure Blockchain Service. The new service enables businesses and developers to create their own permissioned blockchain through the Azure Portal.
Just a few days later, Microsoft went a step further, providing a toolkit for Azure developers to build blockchain applications on the Ethereum blockchain. It also announced partnerships with two of the world’s largest brands, Starbucks and JP Morgan, and so we can expect this service to generate a great deal of buzz.
10. Cosmos launches the ‘Internet of Blockchains’
Perhaps the greatest challenges for blockchains in enterprise – particularly public blockchains like bitcoin and ethereum – have been the abilities to scale and to transact between different blockchain networks. Amid much fanfare in April, the blockchain platform Cosmos finally launched its native token, ATOM, intended to overcome the scalability and interoperability issues associated with blockchain technology.
The world’s largest crypto exchange, Binance, gave ATOM a vote of confidence not often seen in crypto, by adding this currency to its exchange without Cosmos’ asking to be listed. Expect Cosmos to be a big topic of discussion at New York Blockchain Week.
This list of activity from some of the world’s largest brands is remarkable, but perhaps more remarkable is that it is far from exhaustive.
Now, with the price of bitcoin back above $6,000 and steadily climbing, we think that the sharp market correction of 2018 did nothing to hamper the overall adoption of blockchain among large enterprises. Quite the opposite, we’ve seen more activity among enterprise in the last month than in the entirety of 2017.
For too long, the crypto tail has been wagging the blockchain dog.
At last, the dog is having its day. Wuff!