Blockchain is an aggressively growing technology. Different platforms are utilizing the technology to make compelling products that help secure transactions and assets, make business processes effective and integrate separate business entities. It is essential to understand how technology will be used in the coming times. The article explores some expectation from blockchain this year!
Blockchain Technology will Take a Boom
In 2018, blockchain technology will take an exponential boom, and will shift from permissioned blockchains to permission less blockchains. It can be called the next generation of internet, with decentralized transactions, decentralized messaging layer, the decentralized storage layer, and a high-end computing system. Various sub-technologies are utilizing blockchain, such as
Ethereum for decentralized operations, Matrix for a decentralized messaging layer, and others.
A similarity of patterns between the usage of consumer-oriented internet and blockchain. Games, gambling, and pornography escalated as people gained access to the internet. Blockchain platforms such as Spankchain, Virtue Poker, Fun Fair and others are attracting people with similar interests.
Bitcoin is Just the Start
‘Blockchain is the tech. Bitcoin is merely the first mainstream manifestation of its potential’ – Marc Kenigsberg
One of the most hyped blockchain technologies is bitcoin, but it’s just a start for blockchain’s glory. Bitcoin has developed a secure digital space for storage, but it’s the most basic utility of blockchain. There are technologies which provide everything that bitcoin does and more, such as Ethereum. It understands the need for trust and capitalizes it.
2018 will witness robust technologies, leaving bitcoin far behind. Some interesting uses of blockchain will become famous such as programmable money. Simple documents of Microsoft Word will be encrypted by code, further enhancing the security and privacy of data.
Permissioned Blockchains will Lose their Clientele
Just a few decades ago, intranet took over the internet, and there was no looking back. The phenomenon will repeat itself with permission blockchains. Permission less blockchains will become popular as they will strengthen their security, leading to the downfall of permissioned blockchains, like Ripple. Most developers will witness a shift of interest from permissioned to permission less blockchains, as permissioned blockchain will lose their relevance in the digital world. However, some sectors will continue to use the permissioned blockchains.
Permission less blockchains allow users to create individual addresses which can interact with the network. The transactions are submitted by the users and entries are added to the ledger. Permissioned blockchains determine which user to validate for the transaction while building nodes across the globe.
Ethereum will be the Largest Blockchain Developer
The interest of developers determines the success of a technology. Ethereum will continue to be of interest to developers from around the globe. The platform has minimized (almost eliminated) the chances of fraud, censorship or any other type of interference from any third-party.
Custom-built blockchain allows developers to create platforms without any third-party or middleman. This reduces the risk from any external or internal source.
Ethereum has a rapidly growing community. MetaMask has more than 500,000 users, Infura receives more than 2 billion requests daily, and Truffle has over 250,000 downloads.
The platform will maintain its competitive edge and continue to grow in 2018.
Blockchain will Become Mandatory for Asset Tracking
Blockchain will become mandatory for tracking assets, especially those of high values. Soon organizations will understand that blockchain allows tracking and tracing assets and connecting the information to the public chain. Blockchain has various implications within real estate, enabling continuous monitoring and facilitating quicker sales when needed. This allows asset holders to claim and prove their ownership of the assets easily.
Walmart has already started using blockchain for its supply chain. The platforms help manage inventory which can otherwise lead to inefficiencies, wastage of resources and reduced customer loyalty.
The technology will reduce stolen and counterfeit goods, protecting the business of original products.
Blockchain will Serve Humanity
Apart from helping businesses and industries progress, blockchain will be utilized for addressing societal issues. Ethereum has already supported the United Nations in addressing hunger and poverty as well for assisting refugees in living in different regions of the world. It facilitated the World Food Program to distribute food vouchers amongst thousands of refugees.
The problems of refugees have gained global attention. People who are forced to seek refuge live as immigrants or third-grade citizens in foreign lands for the rest of their lives. Blockchain technology can help track their assets in the parent country, assign identification and manage their living.
Businesses will Educate Themselves about Blockchain
Although software developers and engineers understand the technical aspects of the blockchain, different functional units of business will educate themselves on the utility of blockchains. It is predicted that specific educational programs will be developed for managers, lawyers, decision-makers, policy controllers and business students to analyze the potential of blockchain in integration business processes such as inventory management, supply chain, asset tracking, asset depreciation, and others.
Blockchain will go beyond computer scientists and shall trickle down to people in layman terms for everyone to benefit from it. This highlights the importance and scope of blockchain in various field of life in 2018.
Blockchain will collaborate with Lawyers
Legal concerns on the use of technology have always been significant. As blockchain will pave its way into different fields, it will become integral for lawyers to understand the technology and analyze it from a legal perspective. Ethereum has started working with lawyers to help the legal community in the making most of the blockchain technology as well taking their experts’ opinions on keeping blockchain free of any legal obligations. Enterprise is working with some leading firms and school for the collaboration.
Lawyers can create, edit and deploy legal agreements with Ethereum. This helps in saving time and costs, especially for traditional consumer agreements like that of purchases and equity.
Blockchain will Encourage Digital Assets
The importance of digital assets is increasing with the increasing popularity of blockchain. Soon all tangible assets will have a digital presence on the distributed ledger, including real estate, stocks, loyalty points, train ticks, gold, natural resources and more. Regulators of the assets will be facilitated to create efficient and competent specifications of software. The compliance of these specifications by companies will be enforced by the regulators.
The regulation process has been initiated by Jesse Clayburgh, Juan Batiz-Benet and Marco Santori through SAFT. More research is being conducted on the efficiency of SAFT as Cardozo Law and ConsenSys Legal join heads to explore more about SAFT.
Blockchain will Raise Disputes on Taxes
As the technology will grow exponentially and shall be utilized in different industries, the Internal Revenue Service and other departments will activate to receive their share. The struggle has already started as in the case of United States vs. Coinbase, Inc. Virtual currencies that allow conversion to traditional currency are considered property and tax laws will apply on them.
Internal Revenue Service asked Coinbase, Inc. to declare customer records of its 14,000 customers. After a long battle, the San Francisco district counter ordered Coinbase to exchange customer data.
Such issues will increase in the coming times as blockchain will continue to grow. It is crucial for companies to pay their taxes, to avoid any conflict.
Individual Online Identities
‘Online identity and reputation will be decentralized. We will own the data that belongs to us’ – William Mougayar
Blockchain will allow to manage individual online identities without any third-party provider such as Facebook, LinkedIn, Twitter or so. This will help companies manage their profiles without any limitations or constraints. Government and other regulating bodies will act as attesters to identify and verify different users. The online portfolios will serve as credit scores for the person or company, helping recruiters, investors and other stakeholders to make their partnership decisions accordingly.
The practice has initiated in Switzerland. The city of Zug is offering digital identity to all the citizens, with a digital ID. The personal data is secured by cryptography.
Open Source Work will be Monetized
‘If you want to buy $10 of Ethereum and poke around with smart contracts, I encourage that. But use it as a technology, not as an investment, unless you know what you’re doing’ – Olaf Carlson
Open source work will be monetized for the first time, facilitating entrepreneurs and developers to make their developments a success on a global platform. The exposure will develop an overall competitive environment in the development arena.
General Manager of MariaDB, Steven Grandchamp, says ‘The whole idea is to put the product out there, let people use it, experiment with it, and jump on the chat channels.’
Regulating through the Blockchain
In 2018, government to government and government to citizen digital regulations will enhance. This will help save costs and make it easier to track the treaties. The technology will share the responsibilities of the regulatory authorities by providing a platform for tracking the laws and regulations, instead of accessing company records and personal data. The regulations will be written as smart digital contracts making it easier for parties to comply.
However, the Securities and Exchange Commission is focused on discouraging any possible irregularities related to the blockchain.
Deputy Direct of the United States Treasury, Sigal Mandelker, says ‘We feel very strongly that we need to have this kind of regulation all over the world.’
Stablecoins will Rise
Stablecoins are essential for using cryptocurrencies and making the most of the technology.
According to a report by one of the leading crypto providers, Blockchain Luxembourg, ‘the number of active stablecoin projects has dramatically increased over the past 12-18 months, and more than a dozen project teams have states they plan to launch in the coming weeks/months’.
The stability of stablecoins makes them valuable, unlike other cryptocurrencies. The low volatility addresses the concerns raised on bitcoin.
Digital Assets will Exceed $2 trillion by 2019
‘Cryptography shifts the balance of power from those with a monopoly on violence to those who comprehend mathematics and security design’ – Jacob Appelbaum
The price and value of cryptocurrencies will increase. Ether will exceed $2000 and shall outgrow bitcoin, surpassing the total market cap of bitcoin. Filecoin’s market cap will also exceed that of bitcoin in the next five years. On the contrary, bitcoin will lose value, if it doesn’t evolve with the changing market trends. Its governance issues are another concern.
Forward Pricing Curves and Contango
Forward pricing curves will be provided by different regulating bodies where the future price of bitcoin and other cryptocurrencies will be predicted higher than the expected spot price. Since the spot price will be lower, people would be willing to purchase digital assets.
After analyzing how bitcoin settled last year, the market will be careful with the assets and shall predict a prosperous future, so the world remains interested.
Several new digital assets will emerge in the storm.
Auditing Agencies will Gear Up
The new digital world of cryptocurrencies and digital assets cannot afford bugs and viruses. Moving to a valuable era of the internet demands error-free transactions and bugs can lead to potential losses. What good would the digital assets be if people still have to work around the same system?
Security auditing agencies like ConenSys Diligence will gear up to audit the security, privacy, and reliability of various blockchain platforms. It will help blockchain by improving the platforms and validating the reliability of the platform from third-parties.
From Proof of Work to Proof of Stake
Ethereum has already started using testnet alpha of Casper and people are looking forward to the platform to transition from proof of work to evidence of stake. A proof of work is an economic measure against service abuses and attacks. Spams are the most common form of strikes and are actively addressed by the service provided using ASIC or GPU.
Proof of stake used various validators on each bet as deemed necessary. The weight of the validators varies with the size of the deposits. Those found guilty will be penalized. This will help reduce energy consumption and hardware costs.
Rameez Ramzan has been a senior digital marketing executive at Cubix, a leading software development company in Washington DC that specialized in blockchain development and software development. With over 6 years of experiences in the software development industry, Rameez is passionate about helping business to increase their branding on the internet.