Blockchain technology is predicted to face a challenging year in 2017. Despite the hype, the technology is yet to prove its worth beyond its most successful application – Bitcoin. Several influential figures in the tech industry have expressed doubts about the practicality of blockchain, including Richard Gendal Brown, CTO of R3, who believes that the technology is poorly understood and overhyped.
Blockchain’s core value proposition is its ability to enable trustless transactions, but this may not be as useful as initially believed. In most cases, parties conducting transactions require a certain level of trust, suggesting that blockchain’s primary advantage may not be as applicable as assumed.
Furthermore, blockchain’s decentralised nature, often touted as an advantage, can also be a hindrance. Decentralisation can lead to inefficiencies and difficulties in decision-making, as seen in the Bitcoin community’s ongoing debate about scaling.
Despite these challenges, blockchain has potential in certain niche applications. For instance, it could be useful in situations where trust is difficult to establish, such as in international remittances. However, the question remains whether these niche applications can justify the significant investment in blockchain technology.
In 2017, it is expected that the industry will begin to distinguish between the hype and reality of blockchain. The technology’s true value and potential will likely become clearer, either validating its promise or exposing its limitations.
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