Blockchain – A Technology Hailed for Championing Decentralization Might Paradoxically Increase the Power of Platforms
igorpejic.substack.com
As incumbents in finance and tech are fretting about decentralized applications, Google and Amazon have already moved beyond the myths and are aggregating blockchain services. Every day the digital paradigm is strengthening its grip on businesses, mostly through incremental improvements such as making a website more user-friendly or offering an online-banking app. Only rarely do we come across technological breakthroughs that have the potential to simultaneously disrupt back office processes, arenas of competition, and business models. The inventions of the internet and cloud computing have been such radical innovation. So is the distributed ledger technology blockchain. Yet while its impact on process improvements has been documented meticulously, business model transformation has not. The only forecast, repeated like a never-ending mantra, is that trust institutions such as banks and platforms such as Facebook are forecast to be out of business soon. This is wishful thinking of the hard-core crypto-scene. In fact, the opposite can be the case. To show why, we first must look at the succession of economic paradigms.
Blockchain – A Technology Hailed for Championing Decentralization Might Paradoxically Increase the Power of Platforms
Blockchain – A Technology Hailed for…
Blockchain – A Technology Hailed for Championing Decentralization Might Paradoxically Increase the Power of Platforms
As incumbents in finance and tech are fretting about decentralized applications, Google and Amazon have already moved beyond the myths and are aggregating blockchain services. Every day the digital paradigm is strengthening its grip on businesses, mostly through incremental improvements such as making a website more user-friendly or offering an online-banking app. Only rarely do we come across technological breakthroughs that have the potential to simultaneously disrupt back office processes, arenas of competition, and business models. The inventions of the internet and cloud computing have been such radical innovation. So is the distributed ledger technology blockchain. Yet while its impact on process improvements has been documented meticulously, business model transformation has not. The only forecast, repeated like a never-ending mantra, is that trust institutions such as banks and platforms such as Facebook are forecast to be out of business soon. This is wishful thinking of the hard-core crypto-scene. In fact, the opposite can be the case. To show why, we first must look at the succession of economic paradigms.