Today, 17.5 million units of bitcoin are in circulation, up from seventy thousand when the cryptocurrency first launched in 2009. This sizeable increase is testament to the speed at which blockchain, the technology underlying bitcoin, is becoming more widely used. Yet cryptocurrency is just the tip of the iceberg; today blockchain use cases are found not only in finance but in a diverse range of industries including healthcare, government, and agriculture.
But for the moment many large corporations, including banks, are only experimenting with blockchain. For the average consumer, meanwhile, cryptocurrencies like bitcoin are still too cumbersome to use on a daily basis, even though they have the potential to deliver many advantages over traditional fiat money.
The situation we then have today is complex: blockchain is poised to disrupt many industries, but at the same time has not quite hit the mainstream.
This intriguing picture is at the heart of day 4 of Silicon Valley Innovation Center’s Navigating Fintech Disruption executive immersion program. Through company meetings and workshops, we show executives how blockchain is being used today, the potential it holds for the future, and how they can themselves deploy it within their own enterprise.
Day 4 begins at Stanford University for an interactive session with the Stanford Blockchain Collective. An interdisciplinary group, the Collective works on some of the most advanced blockchain and cryptocurrency research anywhere in the world.
This meeting brings executives the very latest information on how and where digital ledger technology is being used. Program participants learn about applications of blockchain not just in banking and finance; they also see inspiring use cases in industries such as energy, education, and environment. The session at Stanford shows executives just how different the world will look when blockchain is applied widely across the economy.
Simplicity is Key
Still, for all the disruptive potential blockchain possesses, it is in banking and finance where its biggest impact is felt. The original use case for blockchain – as tracking technology for cryptocurrency bitcoin – also remains its most well-known.
Yet even though bitcoin has spread rapidly and is now held in millions of wallets worldwide, it is still too complex for many consumers who typically use cash and credit or debit cards to make everyday purchases.
A number of startups in Silicon Valley are trying to change this pattern of behavior. Among them is Abra, whose mission is to simplify cryptocurrency and bring it to the mass market.
During a meeting at Abra on Day 4 of the program, participants gain unique insights into the cryptocurrency economy. They also learn how the majority of Abra’s users see bitcoin and other virtual tokens as long-term assets to hold on to rather than as an everyday cash alternative.
Executives also hear Abra’s vision for the future of cryptocurrency. Namely, following past periods of euphoria and volatility in price, we are now entering a more stable phase where larger investors will enter the market. This movement has the potential to drive up the values of currencies like bitcoin and etherum in a big way.
“All this infrastructure is being built for institutional investors to come into cryptocurrency,” says Bill Barhydt, the CEO and Founder of Abra. “As institutional money makes its way into the crypto space, watch out. It’s not going to take a lot because it’s still a relatively new asset class.”
Focus on User Experience
An interactive session at HyperWallet, a global payouts platofrm, builds on the learnings at Abra. During a visit to the company, executives gain clarity on how institutions and corporations will implement more blockchain solutions in the future.
Namely, they will take advantage of blockchain as a service platforms provided by big tech firms such as a Amazon, IBM, and Google. It is through this virtual infrastructure that companies from all industries will be able to develop and test their own blockchain applications.
These platforms will simplify the user interface, thus allowing innovative blockchain solutions to flourish. Hyperwallet’s own global payouts platform is rooted in this philosophy. It takes what is a complex process and transforms it into an elegant customer experience.
“We have to remember that consumers don’t use these technologies directly,” says Michael Ting, Digital Markets Vice President at Hyperwallet. “We use products and services that employ those technologies, and those products and services are run by companies and service providers.”
The fourth meeting of the day was held with Tradespace, a startup operating a proprietary intellectual property analytics platform. This session is focused on future use cases of blockchain, including for intellectual property rights management.
Experiments in this field have already been conducted, with singer Imogen Heap soon to launch a blockchain platform through which artists can release their work. Heap believes the digital ledger technology will help enforce copyright on creative work and bring performers greater revenue.
Executives dive into this theme with Tradespace, learning through an interactive Q&A session how blockchain’s immutable record-keeping architecture will impact not just creative work, but any industry where an intermediary between parties has traditionally been required to verify transactions. This includes not just banking and finance, but other high-value industries such as real estate and law as well.
Experimentation Today, Rewards Tomorrow
As participants discover on day 4 of the Navigating Fintech Disruption program, blockchain will appear in more and more industries. For now, cryptocurrency is still its most common use case. However, this is changing as experimentation moves to execution in leading areas such as logistics, supply chain, and finance.
Challenges undoubtedly remain, with much still to be done across industries and countries to agree upon a unified set of regulations and legal frameworks. Once those rules are in place, the companies working with blockchain now will be best-placed to take advantage of the technology when it becomes as ubiquitous as smartphones and the internet today.
Silicon Valley Innovation Center helps financial sector executives experience and connect with the Silicon Valley fintech startup ecosystem through a fintech executive immersion program. As Silicon Valley is a hotbed of fintech innovation, company executives will benefit greatly from visiting the innovation hub and interacting with startups like the ones mentioned in this article. Through this immersive experience, executives will also gain deep insights into how partnering with Silicon Valley startups can be a game-changer for their businesses.