Four reasons why 2017 will be a big year for blockchain

Peter Loop, vice president and chief technology architect at IT services provider Infosys, explains why he believes 2017 will be the year blockchain will see more widespread testing, deployment and adoption, despite signs that 2016 was the year blockchain hype peaked.

I can confidently say that blockchain will be the most dynamic technology in tech in 2017, and we are seeing some of the biggest companies already positioning themselves to make big leaps in the next year.

For example, global banking giants Santander and Goldman Sachs recently announced their withdrawal from the R3 blockchain alliance, which they helped to create, and turned to internal blockchain technology research and development. However, recently, Wall Street financial giants such as Goldman Sachs and JPMorgan Chase participated in the $18 million financing of New York blockchain startup Axoni.

Announcements like these are occurring on a regular basis, setting the tone for blockchain to become a significant focus of technology investment and development over the next year.

More and more industries are realizing the urgent need to stay ahead of the curve and are exploring ways to use blockchain technology.

Here are my top four predictions for the most impactful changes to blockchain in 2017:

1. Blockchain realizes network deployment

As misconceptions about blockchain fade, next year we will see full-scale deployment of the technology across the financial services, insurance and healthcare industries.

This will completely disrupt our payment systems globally, and revenue models and other processes will become a thing of the past, making the payment process faster, cheaper and more secure.

But as blockchain becomes mainstream, we can no longer ignore the major obstacles that stand in our way. For example, banks must define a clear path for blockchain adoption and collaborate on global blockchain standardization.

2. Blockchain standardization will make progress

As blockchain adoption grows, finding a standardized way for them to interact will be critical. This process will involve a complex political process where industry groups have competing interests and businesses have perceived advantages.

As blockchain implementations begin to take hold, we will see a paradigm shift toward standardization and integration, as once-competing organizations realize the benefits of unity, including faster trade processes, improved detection, and better data management.

On the other hand, according to previous reports, there are currently about 25 known global blockchain alliances with more than 500 participating institutions. By 2017, there may be only a few of these alliances that are viable, but industry participants will have to work together to reach an open and flexible blockchain standard. Governments and regulators will also play an important role in protecting consumers and promoting innovation.

Stakeholders who drive the development of blockchain standards will need to be creative and envision a future where these standards can be leveraged to create new and powerful tools.

3. Blockchain helps accelerate the development of financial technology

Financial technology (Fintech) is bringing about tremendous changes, from simple personal payments to complex global financial operations.

Predicted changes in the coming year:

1. Blockchain and machine learning will work together to accelerate existing processes and optimize efficiency

2. Emojis and payments will become more widely used, while mobile devices become more secure.

3. Lending networks will become one of the hottest areas in blockchain.

4. Countries around the world will be very interested in the development of digital currencies.

4. Payments are ripe for disruption

In the area of ​​payment transactions, blockchain technology can be used to overcome current problems facing the correspondent banking system and international money transfers.

The fee-intensive and fragmented processes of cross-border non-cash transactions could be eliminated by removing third parties, direct money transfers and efficient interbank settlement. This potential to create a competitive market for liquidity providers could perhaps ensure the best possible exchange rates for international exchange and payment transactions.

Payment systems are based on existing local banking regulations and practices, and the lack of common standards has reduced the ability to seamlessly transfer data and back-end information, which can create settlement and non-settlement risks.

The widespread implementation and use of blockchain will change and disrupt the existing financial services industry and payment systems on a global scale.

Summarize

Blockchain technology has the potential to revolutionize processes and systems across many industries by removing trusted third parties, reducing costs and ultimately increasing profits for industry stakeholders.

However, this technology is not a one-size-fits-all solution, so potential use cases need to meet the specific characteristics and requirements of this technology, such as security, decentralization, and reliance on the Internet as a foundation.