Blockchain – SAGE Business Researcher

Will it transform how businesses track goods?

Executive Summary

Blockchain, the technology originally created to support bitcoin and other cryptocurrencies, is being applied to numerous other business functions, and advocates call it potentially transformative. The qualities of transparency, decentralization and inalterability that made blockchain work for cryptocurrencies also make it useful for applications ranging from documenting shipping manifests to tracing food production and managing inventory and supply chains. Several major corporations are investing in blockchain and exploring its uses, including IBM, Walmart, Accenture, the shipper Maersk and diamond producers De Beers and Alrosa. Yet skeptics question whether blockchain offers anything unique, and some experts say it will take many years for the technology to develop and spread.

Some key takeaways include:

Blockchain’s designers seek to prevent hacking and fraud by requiring that multiple users accept a transaction as valid before it can be included in the digital ledger.
One of the technology’s biggest boosters, Overstock founder Patrick Byrne, has said he plans to sell his e-retailer and devote his fortune to blockchain.
Potential obstacles to blockchain’s development include the adequacy of its speed, whether individual blockchains can communicate and the possibility of government regulation.

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Resources for Further Study

Bibliography

Books

Eha, Brian Patrick, “How Money Got Free: Bitcoin and the Fight for the Future of Finance,” Oneworld, 2017. A former editor at Entrepreneur Magazine recalls the early days of cryptocurrency and blockchain, and the rogue’s gallery of actors who populated it.

Huizinga, Redmer, and Arturo Bris, “Blockchange! How to Survive the Crypto Economy,” IMD Lausanne, 2018. Management experts at the Swiss business school argue that blockchain is a new technological framework that will form the basis for numerous changes in how we do business.

Mougayar, William, “The Business Blockchain: Promise, Practice, and Application of the Next Internet Technology,” Wiley, 2016. A venture capitalist offers a vision of how the technology can transform business.

Articles

Darrow, Barb, “At the Ripe Age of 105, IBM Seeks to Reinvent Itself – Again,” Fortune, June 16, 2016, https://tinyurl.com/jqxpdfy. The iconic company has moved through several phases as a producer of computer hardware and is now offering cloud services, quantum computing, artificial intelligence and blockchain technology.

Iansiti, Marco, and Karim R. Lakhani, “The Truth About Blockchain,” Harvard Business Review, January-February 2017, https://tinyurl.com/h6n4no6. Two Harvard business professors describe blockchain as a long-term foundational technology that has the potential to transform society as much as the internet did.

Marr, Bernard, “How Blockchain Will Transform the Supply Chain and Logistics Industry,” Forbes, March 23, 2018, https://tinyurl.com/ycn7cg8j. An international speaker and consultant gives a quick overview of supply chain applications for blockchain’s distributed ledger technology.

Wladawsky-Berger, Irving, “Blockchain Beyond the Hype,” The Wall Street Journal, Dec. 19, 2018, https://tinyurl.com/y87dg7mo. A former IBM executive says blockchain is still in the experimental phase and, like any new transformative technology, will have ups and downs as users find its best applications.

Reports and Studies

“Blockchain/DLT: A game-changer in managing MNCs intercompany transaction,” IBM, 2017, https://tinyurl.com/y9asnx6l. IBM’s computer services group pitches the uses of blockchain for multinational corporations.

Auer, Raphael, and Stijn Claessens, “Regulating cryptocurrencies: assessing market reactions,” BIS Quarterly Review, September 2018, https://tinyurl.com/y9zzx5ru. Cryptocurrencies and blockchain, although still outside the reach of national regulation, are subject to regulatory developments.

Nakamoto, Satoshi, “Bitcoin: A Peer-to-Peer Electronic Cash System,” bitcoin.org, 2008, https://tinyurl.com/kkxbyss. The pseudonymous founder of bitcoin describes the new cryptocurrency and the blockchain technology supporting it.

Schatsky, David, Amanpreet Arora and Aniket Dongre, “Blockchain and the five vectors of progress,” Deloitte Insights, Sept. 28, 2018, https://tinyurl.com/ydc6qlh2. Blockchain faces many obstacles – technical, legal and regulatory – but interested parties are working on all fronts to overcome them, according to three managers at the global consulting firm.

The Next Step

Application

“Ugandan Firm Uses Blockchain To Trace Coffee From Farms To Stores,” Forbes Africa, Jan. 24, 2019, https://tinyurl.com/ybmnndfm. A Ugandan company is using blockchain technology to provide consumers with detailed information about its coffee shipments.

Paton, Elizabeth, “Will Blockchain Be a Boon to the Jewelry Industry?” The New York Times, Nov. 30, 2018, https://tinyurl.com/y9o66jt4. Major diamond companies, such as De Beers, are embracing blockchain as a way to digitally track their product from mine to consumer and vouch for its authenticity and value.

Pupazzoni, Rachel, “How blockchain tracking technology could revolutionise Australia’s food industry,” Australian Broadcasting Corp. News, updated Jan. 17, 2019, https://tinyurl.com/y95kxhqk. Australian companies are using blockchain to let consumers know the origin of their food.

Investments

Baydakova, Anna, “Overstock Venture Chief Expects Market for Blockchain Products in 2019,” CoinDesk, Dec. 13, 2018, https://tinyurl.com/y98pxfmc. The founder of venture fund Medici Ventures says its parent company, e-retailer Overstock, is investing more heavily in companies that develop blockchain technology.

Rooney, Kate, “72-year-old Fidelity bets on the future with blockchain, virtual reality and AI,” CNBC, updated Oct. 2, 2018, https://tinyurl.com/y8gwutxo. The financial firm Fidelity is exploring how blockchain technology could be used beyond its initial purpose for cryptocurrency.

Sharma, Ridhima, “Swiss fintech raises $2m for blockchain project,” Investment Europe, Jan. 30, 2019, https://tinyurl.com/ybvwbuvf. A Geneva-based financial technology firm has sold shares in the company to investors using blockchain-generated tokens.

Organizations

BECON/Blockchain Ecosystem Network
Guiness Enterprise Centre, Taylor’s Lane, Dublin 8, Ireland
+353 1 4100 600
https://www.becon.global/
A global and cross-sector platform for collaboration, networking, explaining and advancing blockchain methodologies and solutions.

Blockchain Alliance
c/o Jason Weinstein, Steptoe & Johnson, 1330 Connecticut Ave., N.W., Washington, DC 20036
1-202-429-8061
https://blockchainalliance.org/
A public-private forum for open dialogue among industry, law enforcement and regulatory agencies to help combat criminal activity on the blockchain.

Chamber of Digital Commerce
1133 15th St., N.W., Washington, DC 20005
1-202-302-6064
https://digitalchamber.org/
An advocacy group for blockchain and digital assets. It co-sponsors the DC Blockchain Center, a resource for technology providers and governments investing in blockchain-based technologies.

Global Blockchain Business Council
1440 G St., N.W., 9th floor, Washington, DC 20005
https://www.gbbcouncil.org/
info@gbbcouncil.org
An industry association that seeks to advance understanding of blockchain technology and promote its adoption.

Hyperledger Project, Linux Foundation
1 Letterman Drive, Building D, Suite D4700, San Francisco, CA 94129
1-415-723-9709
https://www.hyperledger.org
info@hyperledger.org
An open-source project for blockchain and related tools operated by the Linux Foundation, a resource for developing applications using the Linux operating system.

Wall Street Blockchain Alliance
355 Madison Ave., New York, NY 10017
1-917-293-2405
https://www.wsba.co/
info@wsba.co
Trade association that works to promote adoption of blockchain technology by financial markets throughout the world.

DOI: 10.1177/237455680505.n1