Blockchain Technology: Overhyped or Underused?

With the recent collapse of FTX, investors are now worrying about the future of cryptocurrency. While some blame the technology, we should remember that people are corruptible, not blockchain. The ledger-based technology that makes cryptocurrency possible is as much a breakthrough today as it was yesterday. Unfortunately, crashes like FTX play into fears that blockchain is more hype than breakthrough. Will blockchain once and for all prove to be of little use in business?

As blockchain technology created a new way of thinking about money and creating wealth, many in the IT companies started thinking about using blockchain technology to streamline business processes. For example, the global supply chain is still not working as well as it could. More than a decade later, enterprise adoption of blockchain technology is crawling at best and stalling across the board in many of the world’s largest companies.

Blockchain is a new technology, which means its full potential and practical applications are still developing. This creates hype as visionaries dream of using the technology to its full potential, usually long before anyone else sees the benefits. This is the downside of emergent technology, as the hype often masks the reality.

Related: Blockchain is everywhere: How to understand it

Do you remember the cloud?

When cloud computing first came out, it was a new technology. Software developers attempted to develop SaaS applications where people purchased a software service rather than installing the software on each workstation. Two decades later, the endpoint of the evolution of cloud computing revealed itself without fanfare. Cloud computing is behind the scenes and responsible for billions of data exchanges daily.

Everyone takes the cloud for granted today. But go back 20 years and the same hype led to similar conversations about cloud computing. In fact, go back half a century and you will find hype about the use of computers in business. There was even excitement about driving a car instead of a horse. The point is that the hype is part of the adoption process that all emerging technology must go through to become technology behind the scenes.

The facts behind the hype

Blockchain technology and the movement of digital information across different locations is not exaggerated. Human civilization needs blockchain because it protects the process of moving digital data from one place to another in a physical realm people cannot see. Once a Bitcoin is transferred, the record of this transfer does not change.

What may change is the cyber security around the transfer. Because software is a product of human creation, errors will appear when using the technology. Our community deals with this regularly. Consequently, it will be wrong; it is a fact.

Another important point is that blockchain technology needs to use other technology without the associated hype – for example, securing cloud computing SaaS applications using Wi-Fi. If all other parts of the information exchange are secure, finding the errors is a process of elimination.

Related: How Blockchain and Cryptocurrency Can Revolutionize Businesses

Trailblazer vs trail follower

Although some technologists perceive blockchain as overhyped, what does it mean and what should businesses do about it? Hype in the tech sphere is a cultural phenomenon driven by followers waiting for someone else to lead. Everyone knows blockchain is the future, but only a few want to be trailblazers. Unfortunately, it doesn’t help when a trailblazer fails. Business leaders become worried and withdraw.

Provocatively, it collapses like FTX, which works to legitimize the hype for emergent technology. Spectacular collapses tend to spur serious progress to make the technology live up to the hype. For the company, the hype is all about supply chains as the world seeks a better way to manage global shipping.

Making blockchain work for business

Walmart and other large retail companies need blockchain technology or something similar, which drives much of the hype. The global supply chain isn’t working as well as it could, so business needs blockchain much like healthcare needs caregivers due to worker shortages. In this light, overhype is a motivator to take action or stand in line and wait for the trailblazer.

Business decision makers need motivational buy-in from software engineers with a cutting-edge mindset. Moreover, the software applications must be strongly supported by robust security specifically designed to handle the movement of digital information from one point to another.

Related: How Blockchain Can Positively Impact Global Issues

Incremental change

Enterprise adoption of blockchain is slow, but not unexpected. Our modern society wants everything right now. If the digital revolution taught us anything, it’s that change is incremental. The best way to get comfortable using blockchain comes from using it in small test applications. When these smaller programs work as a system, you scale operations together, and work out the bugs from there.

Patience and hype need to get along better. However, trailblazers in the tech sphere must be patient or risk falling prey to hype. Focus on small steps that represent steps forward – for example, using a comprehensive global supply chain with only a small part controlled by blockchain. Once the blockchain-enabled supply chain part is running without errors, please step back and understand how it fits into the larger supply chain. The process and setup systems needed for incremental change don’t pay attention to hype.