Developing Use Cases of Blockchain Technology: Value Creation Perspectives

Introduction

The essence of technology innovation is either to create value or to leverage on competitive advantage in the market. A number of studies indicate that Blockchain technology usage can provide invaluable solutions to resolving existing problems, whilst harnessing operations (Bauer, Leisibach, Zavolokina, & Schwabe, 2018). Blockchain, although not a new technology, had been relatively unpopular until 2008 when Satoshi Nakamoto invented the first widely used cryptocurrency based on Blockchain technology. Named Bitcoin, Nakamoto’s digital currency sought to implement the transfer of value between two “untrusting” parties without the need for a trusted central authority, as is the case for traditional money system. According to Nakamoto (2008), Bitcoin is a peer-to-peer electronic cash system. The first major implementation of Blockchain technology occurred in 2009 when Nakamoto released his breakthrough crypto-based digital currency, the Bitcoin. Since then, the technology has gained public traction and many are advocating for the application of Blockchain technology to areas beyond cryptocurrency such as Education, Healthcare, Insurance, Supply Chain, Asset Management, etc. In Estonia, for example, the Keyless Signatures Infrastructure (KSI) Blockchain technology is used to police Estonian e-services such as the e-Health Record, e-Prescription database, e-Law, and e-Court systems, e-Police data, e-Banking, e-Business Register, and e-Land Registry (Cullell, 2019).

Blockchain in its most basic form may be defined as a time-stamped sequence of tamper-proof record of data that is handled by a cluster of computers which do not belong to any one individual or entity (Shuhada, 2019). The record of data blocks are linked securely to one another by underlying cryptographic principles. Among the core attributes of Blockchain is a distributed ledger in which identical copies of data is shared among network participants and each participant has the ability to independently validate the shared data without the need for central authority, as required in the traditional transactional value exchange. A failure at one node does not affect operation of the network, thereby making a Blockchain network highly available. As a digital technology, manual processing of data is completely eliminated. Blockchain transactions are chronological and time-stamped ensuring that each block of data is intricately and securely linked to the previous one, leaving behind a traceable trail of historical records. Data stored in a Blockchain is cryptographically signed. This makes Blockchain immutable or tamper-proof to a very large extent. Blockchain could only be tampered if more that 50% of the network-computing power is controlled and all previous transactions are rewritten (Carson, Romanelli, Walsh, & Zhumaev, 2018).

As a result of these enticing characteristics of Blockchain technology, there is tremendous interest in the technology by public and private sector operators, various interest groups and individuals alike. The following startling statistics buttress this point: The Blockchain domain is expected to grow by 42.8% by 2020; the entire market capitalization of cryptocurrencies at the end of 2017 was $600 billion (WorldPress, 2017); from 2017 to 2018, the number of Blockchain related jobs on LinkedIn tripled; Global spending on Blockchain solutions equaled $2.1 billion in 2018 (NewGenApps, 2018). In recent years, the hype for Blockchain has been nothing less overwhelming. Within a spade of two years from 2016 to 2018, there were a half a million publications on Blockchain, which also accounted for 3.7 million Google search results (Carson, Romanelli, Walsh, & Zhumaev, 2018). By 2027, it is anticipated that 10 percent of global GDP will be kept on Blockchain according to a World Economic Forum (2015) survey.