Blockchain Trends for the New Decade
The first use of blockchain was only in 2009, when the cryptocurrency Bitcoin (BTC) was launched. Since then the industry has produced over two thousand cryptocurrencies and blockchain networks, though Bitcoin retains the highest market value by a large margin. But much more than just digital currency, digital ledger technology (DLT) offers a unique security and structure that make it suitable for a variety of applications. These range from secure smart contracts to efficiency and transparency in the supply chain.
So, what will be new for blockchain in 2020?
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Blockchain as a Service (BaaS)
Cloud computing continues to give us every ‘as-a-service’ product possible, so why not blockchain as a service? This is a growing trend that offers businesses the chance to work with blockchain to develop their own digital products. These could be decentralised applications (Dapps), smart contracts or other blockchain-enabled applications. Currently the biggest players in the BaaS field are: Microsoft Azure, IBM Cloud, VMWare, Oracle Blockchain and Amazon Web Services (AWS).
Blockchain and AI
The integration of artificial intelligence (AI) and blockchain holds a promising potential in improving development. AI may be able to take blockchain technology forward and with various applications. According to the International Data Corporation (IDC), 2020 will see global spending on AI reach $57.6 billion, and just over half of businesses will transition to blockchain with AI integration.
AI is able to vastly improve the efficiency of blockchain when compared with human supervision on standard computing systems. Blockchain technology can help to clarify AI, and it can track and justify machine learning decisions. The digital ledger means that the data and variables used in machine learning can be recorded. AI has already been used in blockchain in Data Protection, Data Monetization, Creating Diverse Data Sets, Trusting AI Decision Making and Smart Computing Power.
The structure of blockchain currently operates on the basis of complete independence of each individual blockchain. This means that the separate cryptocurrencies and blockchain networks are isolated from each other, so they are left to compete to be more scalable, secure and innovative than their rivals.
However, this creates problems for some large organisations that are resistant to the mass adoption of blockchain, while the technology remains siloed in this way. The competition for scalability has been productive, but blockchain cannot be taken on in the same way as global credit card systems unless it is made more usable.
Fortunately, there are some initiatives working towards the interoperability of blockchain so the different networks can be used more interchangeably. These include Polkadot, Quant, Cosmos, Wanchain and Chainlink.
Due to the volatile nature of the value of cryptocurrency, measures have been taken to strengthen digital currencies. This comes in the form of stablecoins, which can be pegged to fiat money, traded commodities like precious metals, or another cryptocurrency. Digiz Gold Tokens (DGX) is backed by gold, TrueUSD (TUSD) and USD Tether (USDT) are backed by the US Dollar, and Havven provides a decentralised network for stablecoins such as nUSD.
Libra, the new cryptocurrency released by Facebook, may shape the future for new stablecoins, amid the numerous challenges it has already been facing. It is still early days for stable coins, but 2020 is expected to be the year that the new form of currency is taken more seriously.
Federated blockchain is the model that sits somewhere between the public and private blockchain networks. While public blockchain are accessible for the use of anyone, with private blockchain only one organisation has access to write to the network, and read permissions may be public or restricted. This allows the organisations more privacy, but security can be an issue. Unlike public blockchain, this isn’t decentralised.
With Federated blockchain, multiple organisations use the network in a blockchain consortium, which makes a decentralised system possible. Each authority is able to read and write transactions via a highly trusted node, and a selected group maintains the network and validates blocks. 2020 is expected to see an increase in the use of federated blockchain, as it is more customisable than private blockchain.
Blockchain and IoT
The last decade has seen an ongoing expansion of the Internet of Things (IoT) and its manifestations. This could be anything from smart locks and smart thermostats to personal assistants and tracking deliveries. On the global level, internet-connected devices have reached over 26 billion. IoT systems allow our data to be in various places all around us, which means security is an extra challenge.
Fortunately, blockchain technology is able to offer a decentralised solution to a centralised (IoT) framework. Blockchain is public so it can be accessed by all, but users can still control transactions with private keys. Digital ledgers cannot be changed, which means it is completely secure. The use of blockchain by IoT adoptions is predicted to reach 20 percent in 2021.
As a new and fast-growing industry with a wide variety of applications, the call for blockchain specialists is understandably high. Although the number of experts in the blockchain sector has been rising, the implementations of the technology have a wider demand that will make itself known in 2020. It has so far been difficult for universities to keep pace with the emerging technology, but some companies are making efforts to strengthen their existing talent through training programmes.
With technological and economic factors in play, the future of blockchain is not completely clear at this stage. Though it has great potential, the technology has yet to reach widespread adoption, although is anticipated to happen in the near future. 2020 is set to be an exciting year for blockchain, and new developments could be about to revolutionise our everyday lives. Until then, we are left to observe and plan for the new blockchain future.