Why blockchain implementations will need to reinvent themselves by 2021

Blockchain implementations are no longer a thing of the future, but they could soon become a thing of the past if blockchain-based projects don’t rethink the technology’s practicality.

According to a recent report by Gartner, as many as 9 in 10 current blockchain implementations will have to reinvent themselves to stay relevant over the next 18 months.

This means that many projects will have to embrace change to adapt their offerings to suit the market. Gartner warns that if they fail to do this, they’ll have a hard time remaining competitive and secure.

An increased interest in blockchain-based platforms

According to the report, the business sector will show an increased interest in blockchain technology and what it has to offer. However, the existing infrastructure doesn’t allow vendors to keep up with the growing demand.

Without a change in the existing blockchain implementations, many companies won’t survive in the blockchain platform market.

Adrian Lee, senior research director at Gartner, estimates that by 2030, blockchain technology will add a business value of over $3.1 trillion. He therefore advises product managers to get ready for the rapid evolution of the market.

What may seem innovative right now will soon be not specific enough to capture the attention of decision makers in companies. Blockchain implementations will have to fight against early obsolescence and a very competitive landscape to achieve success.

A fragmented system of blockchain implementations

In the press release announcing the report, Gartner analyses the current blockchain platform market. For now, the offerings are largely fragmented and tend to overlap. This makes it hard for potential clients to have a clear picture of the products and their features.

The offerings also lack clarity and fail to address a specific target audience as the vendors don’t have a clear image of the market. Many start-ups are still in their infancy and tend to promise too much. It seems most blockchain business proposals aren’t backed by facts or clear market strategies.

Most of these emerging platforms don’t have a defined identity or marketing message. And it’s certainly too early to talk about blockchain-based brands just yet, besides the top 10-20 blockchains. The message is more focused on technology as a whole instead of discussing specific platform features.

Lee further predicts that none of the existing blockchain platforms will dominate the market in the next five years.

Unrealistic expectations slow down blockchain adoption

As he comments in the report:

“Many CIOs overestimate the capabilities and short-term benefits of blockchain as a technology to help them achieve their business goals, thus creating unrealistic expectations when assessing offerings from blockchain platform vendors and service providers.”

People also find it hard to identify real-life uses for blockchain technology. Companies today still don’t understand how they can benefit from blockchain implementations. Decision makers are confused and don’t see the difference between traditional tools and blockchain-based platforms and apps.

Blockchain technology has the potential to disrupt all industries and reshape the economy. However, most IT managers still don’t understand how they can implement this new technology into their existing operations. They’re confused by unclear messages that don’t highlight the precise benefits of the blockchain for enterprise.

For now, most platforms are largely failing at explaining how companies can achieve long-term benefits from blockchain implementations. Blockchain lingo abounds with terms like “transactions”, “security”, or “immutability”, which aren’t specific enough to help managers make buying decisions.

Blockchain implementations to reinvent themselves by 2021

According to an IBM report, blockchain technology has evolved fairly slowly since its creation 10 years ago. People needed time to understand how the networks worked and how they could create a new digital infrastructure for the global economy.

However, the reports issued by both Gartner and IBM show that the blockchain industry is now heading toward rapid growth. This is due to an increased interest in this technology from banks and financial institutions that are beginning to understand the importance of real-time transaction processing.

90% of banks in the EU and North America started exploring blockchain technology in 2018. Governments and central authorities have been working to implement legal frameworks for the blockchain industry as well. The future looks bright for the technology itself, but can the same be said for existing vendors?

Most blockchain companies will need to reevaluate their immature offerings and come up with specific solutions to enterprise pain points if they want to thrive.