A survey by UK auditing firm PricewaterhouseCoopers (PwC) reveals that most companies are keen to incorporate blockchain technology into their future, but regulatory uncertainty and distrust of the technology is holding many back.
The extensive survey shows four out five firms are actively seeking ways to implement blockchain into their processes, but 48% believe there are still regulatory issues that need to be resolved, and 45% expressed lack of trust.
“Businesses tell us that they don’t want to be left behind by blockchain, even if at this early stage of its development, concerns on trust and regulation remain,” says PwC in its 2018 Global Blockchain Survey to 600 executives from 15 territories.
“Blockchain by its very definition should engender trust. However, in reality, companies confront trust issues at nearly every turn,”
No more intermediaries and lower costs
However, the firm says that “a well-designed blockchain doesn’t just cut out intermediaries, it reduces costs and increases speed, reach, transparency and traceability for many business processes. The benefits can be compelling if organisations understand what their endgame is in using the technology, and match that to their design.”
The survey also reflects an “early dominance of financial services developments in blockchain with 46% of respondents identifying it as being the leading sector in three to five years”.
Financial services providers in the United States and China are leading the way in blockchain development. About 29% of these firms in the US have adopted blockchain to some extent, with China at 18%. The study, however, shows that within the next five years, China is expected to overtake the US.
The survey goes on to say that 84% of the firms surveyed say they have blockchain initiatives underway, of which 15% are live projects. Another 7% say they have their projects on hold.
Among the PwC respondents, who were business executives with technology responsibilities, 45 per cent said that ‘trust’ could be the critical roadblock in blockchain’s widespread adoption.
Those who expressed concerns over trust said this issue could be the principal obstacle to blockchain’s adoption.
“In reality, companies confront trust issues at nearly every turn,” PwC says. “As with any emerging technology, challenges and doubts exist around blockchain’s reliability, speed, security and scalability.”
US-based financial services company recently estimated it would take nearly six years for widespread blockchain adoption.
PwC suggests blockchain is a technology that should be adopted because it “enhances transparency of financial transactions, strengthen the flexibility of system operation, and automate processes, thus affecting the record keeping, accounting and payment settlement methods of financial services”.