Business Model – (Business Industry Insight – 2018)
Business Model – The Human Element?
What’s equally fascinating and frightening is that smart contracts execute without any human intervention.
This raises many legal and practical questions, such as how can you stop a contract out of executing perpetuity?
What happens when one of those parties no longer exists, perhaps because it’s gone bankrupt, once the contract implements?
What happens once an oracle supplies erroneous information, accidentally or intentionally?
Bitcoin stays the most prominent example of blockchain usage. With the equivalent of about $100 billion worth of coins in circulation, this global payment exchange is going through its growing pains.
Soon, there may be a “hard fork” in the code to transition to a model aimed at improving speed and functionality. Ethereum, an open-source, smart contracts system, is a second strong entrance.
These are fast-moving efforts, which compete with many competing implementations.
Smaller scale but equally exciting is exactly what Northern Trust did to the island of Guernsey, a self-governing possession of the English Crown.
Since the operator of the island’s private equity market, Northern Trust realized it could save yourself time and money by employing blockchain to get rid of the requirement to recreate information.
When all parties have a verifiably identical copy of this information, the need to reconcile goes off.
What processes do you have where eliminating the requirement for reconciliation could have a large payoff?
The ‘trust’ factor with any business case, you have to show where the value will generate from, short and long-term.
You may value replication of information for disaster and recovery, or remove reconciliation, or even the tamper-proof audit trail.
As an example, is immutability important for the own purposes? Are the rate and latency of all blockchain within acceptable parameters?
The largest driver of this blockchain business model design is hope. Will you have an explicit trust model, where all participants are understood and authenticated business versions, or would you require something closer to the zero-trust Bitcoin model?
That drives the design of your consensus model and how simple or complicated it’s going to be. From this, you can project energy, computing and power requirements.
Determine your worth and show how it exceeds your costs, and you own a business situation.
This is the early stage of evaluating the many opportunities to apply blockchain to data-processing demands in healthcare.
We would wager there’s potential in your industry, too