Blockchain was one of the top 10 strategic technology trends for 2020 according to Gartner. The global blockchain market size is expected to grow. It is estimated at least 25% of the Forbes Global 2000 will use blockchain as a foundation for digital trust at scale in 2021.
Mr. Daniel Kwong, the Chief Information and Innovation Officer of CITIC Telecom CPC also indicated that blockchain has taken a more and more important role in business development in a webinar. As from the IDC report, blockchain spending grows at a robust pace throughout the 2018-2023 forecast period with a five-year compound annual growth rate (CAGR) of 60.2%. Mr. Daniel Kwong predicted that the banking industry will be the prominent user of blockchain, accounting for roughly 30% of the worldwide total. Besides, discrete manufacturing and process manufacturing will be the next largest industry with a combined share of more than 20% of the overall spending.
The development of blockchain can be divided into three stages, and it is now at the transitional stage from 1st to 2nd. At the first stage, blockchain is still under exploration. The example of its application is cryptocurrency, renowned as Bitcoin. Different from the first stage, the crux of the second stage would be the integration of smart contract and cryptocurrency. At the future stage, decentralized internet would be actualised.
Various distinct features of blockchain can satisfy peoples’ desires for corruption-proof, manipulation-free and traceability. First of all, blockchain is a decentralized technology. Distributed ledgers can enable a decentralized and sharable distributed transaction record system, which can significantly avoid corruptions and manipulations. The blockchain structure can also increase traceability whilst privacy is secured through anonymity without sacrificing the authenticity and verifiability of transactions.
Applications of Blockchain Technology amidst COVID-19
COVID-19 has sped up digital transformation of organisations around the world, especially for blockchain technology. In the first half February 2020, shortly after the outbreak was declared, Mainland China had implemented 20 blockchain projects in combating COVID-19.
Take the data collection and monitoring system developed by the Shandong University of Finance & Economics as an example, it facilitates real-time data collection of students’ health status. Most remarkably, the information could be accessed by different levels of authority to assure data accuracy, integrity, and transparency.
In early February 2020, the Chinese government officially launched a pandemic monitoring platform developed by blockchain and big data technologies to integrate information and reports issued by different provincial health commissions across the country. In order to provide and track the latest progress and status of the pandemic in real-time, a “Health Code” system has been quickly developed to classify citizens into different health groups as indicated by different colours. The health code was also used as the pass for entering specific zones。
Blockchain technology was also applied in donation and material tracking system. The system was developed by Wuhan University and a technology company within a short period of time to track and publish the supply and demand information of anti-pandemic materials in Wuhan. The general public could view the entire process to increase the transparency and trust level in the community.
In addition, the application of blockchain technology in medical and insurance claims process can unquestionably help enhance the security, efficiency, and transparency. In Mainland China, a financial company has developed a blockchain-based collective claim-sharing platform. Settlements can be sped up and fraud can be reduced with the assistance of blockchain network. This can also mitigate the risk of infection by reducing face-to-face contacts. Through applying the blockchain technology, the whole claiming process is traceable and tamper-proof which can ensure the authenticity of bills at every stage.
For enterprises, distributed ledgers of blockchain technology can keep track of all company transactions. Therefore, better business status can be attained by integrating business workflow with blockchain. In addition, blockchain technology can be leveraged to link up transactions of individual customers for lifecycle analytics with Data Science.
In general, blockchain can alleviate traditional pain points, including concerns about traceability, compliance, flexibility, and stakeholder management. It would become more accessible for the company to monitor events and metadata, comply with regulatory requirements, adapt rapidly without significantly increasing the costs, and enable trust and risk reduction. Furthermore, it can provide better engagement, experience, and efficiency to customers.
Considerations for Blockchain Adoption
However, several aspects should be well considered when applying blockchain technology. Enterprises should take system integration and technological risks into consideration as integration difficulty, technical teams’ capability and network stability will notably affect the effectiveness of blockchain applications. Besides, value recognition and privacy are also main concerns. Consensus across different parties and regions should be reached and the compatibility with commercial privacy requirements should never be forgone.
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