In a recently released report, U.S. consulting company McKinsey says that practical use of blockchain technology is lagging behind the amount of money and time companies are spending to experiment with and develop solutions that leverage blockchain tech:
“Of the many use cases, a large number are still at the idea stage, while others are in development but with no output. The bottom line is that despite billions of dollars of investment, and nearly as many headlines, evidence for a practical scalable use for blockchain is thin on the ground.”
The report notes that more than $1 billion has been invested into blockchain startups by venture capital in 2017, while IBM poured in more than $200 million in an IoT data-sharing solution based on blockchain. More than 100 potential use cases for blockchain have been identified across several industries, but many of them are still only at the idea stage, according to the report’s authors Matt Higginson, Marie-Claude Nadeau, and Kausik Rajgopal.
The authors describe blockchain technology as mostly still being in the first, pioneering phase, of its technology life-cycle model, and say it is struggling to progress to the growth stage.
Image source: McKinsey.com
Still, the report does acknowledge that there is potential for practical applications for which blockchain technology can deliver a suitable solution. For example, the authors point use cases that include “include elements of data integration for tracking asset ownership and asset status” as areas where blockchain can provide value. The report also says that there have been positive signs from blockchain experiments in the areas of supply chain management and identity management.