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Took a small break but we are back with our weekly updates and insights!

Enjoy,

Filip

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Shifting tides?

It has been fascinating to watch how incumbents have approached blockchain technologies. IBM, for example, has taken the ‘let’s build our own blockchain’ route while their competitor Microsoft is more agnostic and has positioned their cloud services, Azure, to support whichever blockchain their customers want to use. Two big technology companies with drastically different strategies. While the Enterprise Ethereum Alliance has demonstrated a shifting appetite among incumbents for maintaining interoperability with a public blockchain versus the closed gardens of the consortia strategy. Recently, three high-profile companies (Circle, Brave, and Storj) have abandoned building their services on Bitcoin and have migrated to using Ethereum. There are a number of factors at play here which may warrant a more lengthy blog to flesh out the details. What is becoming clear is that in just the two years it’s been live, Ethereum has seen a lot of success and it doesn’t seem to be slowing down.

What to do with my blockchain?

While many are still running around trying to come up with use cases, it seems others are seeing the real value propositions of new and disruptive technologies — they allow you to do something that has never been feasible before. A number of intelligent comments were made by panelists at the World Exchange Congress and highlighted in this article. They make the important point that blockchain technologies can create new revenue models for your businesses and are not here to simply reduce costs of existing business processes. Specifically for exchanges, it could enable the financialization of new assets that have yet to be digitized or have not been brought to wider markets due to the inefficiencies of legacy systems — lithium, gold, energy trading, property trading. While new markets can be formed around crowdfunding and loyalty points. This is an important differentiation from what the space has largely seen. It’s a strategy that leverages the disruptive capabilities of blockchain technologies and not one that tries to cram it into existing business models to lower costs.

Bitcoin vs private blockchains

An IBM employee wrote an opinion piece arguing that private blockchains can actually create meaningful value despite not being as revolutionary or as interesting as Bitcoin. He makes some good points but his article is somewhat pointless as he is comparing the general use of private blockchains (which vary drastically) versus the use of Bitcoin for enterprise solutions. Bitcoin was never designed to solve problems for the private sector. The public protocol itself is rather limited with a non-Turing complete scripting language while its scaling debate has shed light on its governance crises. Ethereum, on the other hand, was created in response to Bitcoin’s design limitations and was developed to be a flexible platform so developers can build a diversity of applications and create private implementations that are interoperable. I think the author would have had a much harder time comparing the benefits of private blockchains (whatever that means) to Ethereum.

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