The path to Blockchain adoption is not paved yet
When many argue that Distributed Ledger Technology or Blockchain is still in its infancy and deprive the technology to play a significant role, they are mostly not referring to the state of the tech itself but the diffusion level and its rate of adoption.
„Revolution“ is the notion that is often used for the stir that was caused by Bitcoin alone. Hence it does not take much of an imagination to realize what kind of a whirlwind Blockchain technology will become once more use cases find broad usage.
But how does Blockchain technology get to play a significant role?
Technology adoption is driven by its relative advantage and efficiency increase compared to current solutions, the compatibility with the existing system, it’s complexity or difficulty to learn, the hurdles to try and test it and the reinvention profile (using the tool for initially unintended purposes) as well as the visible effects it creates (compare Everett Rogers, Diffusion of Innovation). Simply put, numerous successful tech founders refer to a mandatory „improvement of ten times“ compared to the current technology that must be achieved in order to reach broad adoption.
However, in practice a certain pattern is discernible that constitutes a hurdle for the diffusion of Blockchain: Blockchain businesses or startups are often exclusively led by tech evangelists that have great visions of an instant decentralized future and mostly meet and mingle with like-minded fellows. This is great for the evolvement of the tech stack on an abstract level but the chasm to broad adoption won’t be bridged easily by projects that have a research-like character. The potential adopters - customers of these businesses - are still immersed in a centralized system and have a hard time even following the thoughts and ideals of the Blockchain tech experts or uncovering the real life value of visionary products that have been developed in tech silos. It is not surprising that those potential adopters, i.e. customers, don’t even get to the point where they develop an understanding of the advantages of implementing those edgy and abstract Blockchain technology use cases. Keeping in mind the aforementioned first steps on the road to adoption, the road block is right there.
Ideas of decentralization might be concrete for those who cope with them on a daily basis, but highly abstract for those who are still living in the mostly centralized reality.
In order to light-footedly clear the hurdle and to speed up adoption and finally the diffusion of Blockchain technology, every player in the ecosystem has to do their share: Significant funding has to be allocated to promising Blockchain entrepreneurs that build sustainable businesses; education and evaluation models for adopters foster understanding and successful implementation of valid use cases; research drives the abstract evolvement of the tech stack and the understanding of its socio economic impact. Alliances that unite tech, business and application side at the table promote the mutual understanding.
The high abstraction and disruption level of DLT present additional obstacles on the road to adoption that won't be overcome by simply further developing the tech stack. A clear language that highlights the value add for decision makers and users alike, easy implementation and a great user experience, as well as target-group-oriented education is required to clear the road blocks ahead on the further path to adoption.
Managing Partner Signature Ventures