84% of the organizations globally are actively involved with blockchain technology in some way, with 15% having implemented it, finds PwC’s global blockchain survey 2018.
To find the state of blockchain in 2018, PwC surveyed 600 executives from 15 territories on their development of blockchain and views on the potential of blockchain technology.
Blockchain, the distributed ledger technology, is opening door to new opportunities, reducing the costs, providing greater speed, more transparency and traceability.
With Gartner forecasting blockchain to generate an annual business value of over $3 trillion by 2030, it can be imagined that 10-20% of global economic infrastructure will run on blockchain-based systems by the same year.
State of blockchain adoption in 2018
As per the report, one-fourth of the organizations have either implemented blockchain or have implementation pilot in progress. Whereas, around one-third have projects in development, and one-fifth of organizations are in research mode.
Top industries implementing blockchain
The implementation of blockchain is very high in financial services developments with 46% of financial organizations considering it a leading sector currently, and 41% in next 3-5 years. Blockchain development is also having its potential in industrial products, energy and utilities, and healthcare.
Companies that provide enterprise software platforms for operations like finance, human resources, and CRM, are increasingly integrating blockchain technology into their platforms. In next few years, several business-critical processes will run on blockchain-based systems. Big players like Microsoft, Oracle, SAP and Salesforce have developed their own blockchain platforms.
“What business executives tell us is that no-one wants to be left behind by Blockchain, even if at this early stage of its development, concerns on trust and regulation remain,” comments Steve Davies, Blockchain Leader, PwC.
“A well – designed blockchain doesn’t just cut out intermediaries, it reduces costs, increases speed, reach, transparency and traceability for many business processes. The business case can be compelling, if organisations understand what their end game is in using the technology, and match that to their design.”
Barriers to blockchain adoption
Although blockchain has numerous advantages, there are still a number of concerns that blocks the adoption of blockchain. Organizations cite regulatory uncertainty and trust as the biggest roadblocks, followed by ability to bring the network together (44%).
Blockchain is seen as the technology to foster trust, but organizations are considering trust as one of the biggest concern. This is because it is still an emerging technology and doubts exist around its reliability, speed, security and scalability.
Another reason behind trust gap is lack of understanding. Many organizations don’t even know what blockchain really is and how it can change the facets of business.
The trust paradox is an important but not insurmountable challenge. It can be overcome by implementing certain strategies.
“Blockchain by its very definition should engender trust. But in reality, companies confront trust issue at nearly every turn. Failing to state a clear business case from the outset leads to projects stalling,” continues Steve Davies, PwC.
“Businesses needs to put more effort into building into their design how they can tackle trust and regulatory concerns.”
“Creating and implementing blockchain to realise its potential is not an IT project. It’s a transformation of business models, roles, and processes. It needs a clear business case, an ecosystem to support it; with rules, standards and flexibility to deal with regulatory change built in.”
Of the organizations who had little or no involvement with blockchain, one-third cited cost (31%), uncertainty over where to start (24%), and governance issues (14%) as the main reasons for lack of progress.
By region, the US (29%), China (18%), and Australia (7%) are the most advanced countries in developing blockchain projects. Organizations believe that China will overtake US within next three to five years in blockchain development.
Read the full report here.
Images source: PwC