Blockchain: It’s more than just crypto

With:

Martha Bennett, Vice President and Principal Analyst

Show notes:

Blockchain has a branding problem. Most people associate blockchain exclusively with the wildly volatile cryptocurrency market. But that is not the only use of the technology. In this episode, Vice President and Principal Analyst Martha Bennett sets the record straight and dispels some of the most common myths about blockchain, NFTs, and, yes, even the metaverse.

The episode starts with Bennett explaining that blockchain networks come in two broad categories – permissioned and permissionless/public. The many cryptocurrencies that people equate with blockchain run on public blockchains. However, permissioned blockchains limit user access, and most enterprise blockchains are set up this way so that they can provide real business value with much less risk. For example, a recent Forrester report highlights the banking industry’s use of blockchain to track payments and streamline regulatory compliance. And Bennett is quick to clarify that these corporate blockchains typically have “no cryptocurrency anywhere near them.”

With the difference between public and permissioned/corporate blockchains made clear, Bennett then wades into the murky waters of non-fungible tokens, or NFTs. Again, that’s a misconception to clear up, because most people associate NFTs with collectibles or works of art that are traded on public blockchains. However, Bennett says that “NFTs are a very useful technical construct,” and they can be applied to a business blockchain permission to tokenize and track ownership of a wide range of business assets — from financial securities to container ships and everything in between. It is not the tokenization of assets that brings risk; there is public trading of these tokenized assets.

The discussion then briefly turns to the smart contracts used to manage the ownership of NFTs. While smart contracts are useful, Bennett describes the security risks associated with them and points to some real-world examples to illustrate those risks.

The episode ends with Bennett giving her take on the current state of Web3 and how it relates to the other topics discussed in the episode. “It’s a very powerful narrative that equates Web3 with the metaverse, and we at Forrester collectively disagree with that,” she says. “Yes, there will be overlaps…but you don’t need Web3 for the metaverse.”