The following post comes from a new eBook, Blockchains in the Mainstream, which features 33 of the top thinkers, entrepreneurs, and investors in the world of decentralized systems.
You can read all of the entries from the “Blockchain Dream Team” in the FREE PDF here.
Blockchain technology is an interesting social phenomena. How Bitcoin, an open source project with an anonymous creator, combined several ideas together and built an alternative financial system that challenges banks and proved to be more resilient and secure than they first realized. That sparked a discussion across industries and provided a glimpse of how companies can use the public internet rails to move value and investments soon followed.
For a lot of people this reminds them of the early days of the Internet where investments poured into companies that worked on applying Internet technology for existing players in industries like Telcos. But as the 2000’s bubble burst, it was apparent that Internet companies didn’t reach the anticipated mass adoption and couldn’t meet their earning expectations. This only came several years later, when companies like Facebook and Google showed us how to make money from information and billions of dollars started pouring into new Internet companies.
Telecom companies became ISP’s. Retailers moved online and newspapers became blogs. This came from a deep understanding of the long term underlying benefit of the technology, to connect people together on open platforms.
Like with the Internet, blockchain technology is a simple idea – Choose an open source standard for a specific use-case, build a shared ledger, and bring all the participants to use the ledger.
The tipping point for blockchain technology, is when it will create new business models like the Internet did. The first companies that will prove those models to work will create a huge shift in the business world – from ledger operators that independently control centralized silos of information to a world where outdated business models just don’t work because technology has surpassed them.
But this won’t be an overnight change – blockchain currently lives in an intersection between coders, governments and corporations. Each stakeholder needs to be an active player in the debate in order for the technology to evolve and it requires a fresh realization that those who won’t be a part of the discussion are going to be replaced.
So my suggestion for startups is to work towards getting a seat at this table and focus on the long term benefits of this technology – changing old business models.