Australian banking giant ANZ ruffled a lot of feathers recently with the release of a short, tidy little flowchart. Designed to help enterprise establishments determine if blockchain is the best solution for their data management needs, the ANZ flowchart is simple, lighthearted, and best of all, accurate.
Unfortunately, the conclusions it reaches are not where blockchain proponents wish to end up.
Not the cure-all
The potential to insert blockchain technology into various markets and needs is enormous. However, according to Maria Bellmas, associate director of trade and supply chain product for ANZ, many of these markets boast existing data solutions that already do the jobs that blockchains would be doing. In fact, Bellmas claims that many of these existing solutions, in the form of databases and spreadsheets, already function more effectively than blockchain.
In other words, experts who predict that 2019 will be “the year of blockchain technology” may be correct. Blockchain’s long term potential when other, more established, solutions exist is what is in question.
Blockchain is on a path somewhat analogous to Apple’s foray into mobile devices. When Steve Jobs announced an Apple mobile device in early 2007, a strong contingent of devoted Apple users prepared to do whatever it took to secure an iPhone at the mid-year release date. The rest of us sat back to watch the show.
iPhones have long held the top position amongst mobile devices. However, most people have forgotten the problems plaguing first few years of iPhone’s existence. Issues from billing to connectivity to data were common. iPhone had the reputation of good looks, but not so good functionality. Coupled with an enormous price tag, the 1.9 million consumers who purchased an iPhone in 2007 had the reputation of taking a big risk.
However, iPhone prevailed and quickly became the top selling mobile device by market share ever in existence, with over 216 million iPhones sold in 2018, which actually indicated declining sales.
Could this be the way of the future for blockchain? Bright and flashy, with edgy technology and a young, ambitious following, blockchain technology is as appealing to its followers as the iPhone was to Mac users in 2007. Blockchain could go all the way.
But ANZ doesn’t want to see this happen. Their six-step process to aid blockchain decision making makes that very clear, as do statements directly from Bellmas.
Bellmas concedes that blockchain offers “huge number of benefits and it is particularly proving useful in the trade finance space.”
She simultaneously warns against getting distracted by popular new technology, foregoing processes that have worked efficiently and without error for years.
Bellmas notes “blockchain has only been available in recent times and its scalability is yet to be proven. Some databases offered by leading technology providers have been in the market for years and have a proven record of processing millions of transactions per day without failure.”
It is true that blockchain holds tremendous promise for certain spaces. But is it enough to start bumper sticker trends that people are willing to affix to cars with $80k price tags? That remains to be seen.