“Crucial near-future technology,” is the phrase respected tech predictor Melanie Swan uses to describe the blockchain phenomenon. Nasdaq recently reached out to Swan (Philosophy and Economic Theory, New School, New York) to explore what that might mean to investors.

On the first day of 2017, the U.S. dollar exchange rate of bitcoin passed the “magic” threshold of $1,000, exciting Bitcoin enthusiasts worldwide. Bitcoin, the value of which more than doubled in 2016, was one of the best investments of the year, and the best-performing currency.

One explanation for the sustained rise of Bitcoin in 2016 could be fear of capital controls in countries like India and China, exacerbated by political uncertainties such as Brexit and the rise of anti-establishment political parties in most of Europe, as well as the election in the U.S. of Donald Trump. But another reason for the rise can be traced to the growing — or, rather, exploding — popularity of blockchain technologies that power Bitcoin and other digital currency platforms such as Ethereum.

“The blockchain,” a generic term for all cryptographic distributed ledgers like Bitcoin and Ethereum, seems poised to revolutionize the banking and financial services sector, which explains why nearly all major banks, and even central banks and national governments, are taking an active role.

But blockchain technologies are also likely to have a strong impact on futuristic, disruptive technologies that are expected to emerge in the next decade, such as supercomputing; artificial intelligence (AI), with applications ranging from self-driving cars to big data analysis for personalized medicine; and advanced medical nanorobotics, tiny devices expected to start policing our bodies and ridding us of pathogens and rogue cancer cells before the end of the 2020s.

All that potential is likely to interest forward-looking investors, from wealthy and institutional players to small investors who want to assemble a public stock portfolio oriented toward long-term growth. But how can investors plan for a blockchain-related future?

Swan has built her reputation as a guiding light through these uncharted waters. She founded the Institute for Blockchain Studies to examine the theoretical, philosophical and societal implications of blockchain technology, and is the author of “Blockchain: Blueprint for a New Economy” (2015), a book dedicated to advanced future applications of distributed ledger technology beyond currency (“Blockchain 1.0”) and smart contracts (“Blockchain 2.0”). Swan’s book, which stands out for its unusually extensive coverage of advanced emerging applications, is a worthwhile read for all technology enthusiasts, analysts and investors.

“Blockchain technology is not necessarily the ‘Newest Latest Thing,’ but it is an idea whose development is quietly underway in the trenches,” Swan told Nasdaq. “While Bitcoin and blockchain technology might not be the final solutions, it is clear that secure value transfer via networks is a crucial near-future technology.”

There is one blockchain technology that stands out, according to Swan.

“Identity [blockchain-based identity management systems] is one killer app now in development for next-generation blockchain technology,” she said. “Having standard mechanisms for confirming digital identity is a necessary infrastructural piece for operations such as affirming asset ownership, implementing electronic medical records, and transferring inventories.”

In fact, identity management is a necessary component of most innovative blockchain-based solutions under development.

“The sectors most likely to be impacted by blockchain technology in the next decade are financial services, supply chain and logistics, energy, healthcare and Internet of Things [IoT],” continued Swan. “Establishing core functionality such as identity confirmation and activity verification — for example, shipment delivery and contents — could see rapid implementation and pave the way for higher-level features such as outright asset transfer.”

The AI technologies that are expected to come out of research labs and play a disruptive role in the real world in only a few years are likely to leverage blockchain technologies for internal operational coordination and interactions with the external world.

“Blockchain technology is a secure automation system for managing and tracking arbitrarily large numbers of items and transactions, which implies that a massive new scale of automated operations could be possible,” explained Swan. “Further, blockchains enact smart networks that enforce good-player behavior via consensus, which suggests that humans and AI [intelligent agents] could interact trustfully on the same networks.”

"More advanced applications include ideas like the Bio-Cryptoeconomy: Nanorobotic DACs [Distributed Autonomous Corporations] for Cell Repair and Enhancement, using blockchains to coordinate the in-body activity of medical nanorobots,” concluded Swan. “Medical nanorobots are tiny robotic machines at the nanoscale roving within the human body to perform a variety of health and enhancement operations.

“While autonomous nanomachines are not imminent, already nanoparticles are being deployed clinically in the human body for dynamically controllable drug delivery and other functions,” Swan said, noting that, in the longer-term future, fleets of medical nanorobots might be brought on board the human body for a variety of pathology resolution and enhancement activities.

“Since blockchain technology is a next-generation internet functionality allowing secure value transfer over networks, companies standing to profit the most from this first could be good investments, such as financial services and technology companies,” Swan advises investors. “A higher risk way to gain exposure would be by investing in blockchain technology companies as they launch initial public offerings in the future, or in private equity funds focusing on the sector.

A number of companies and ongoing projects are following the directives identified above. Microsoft is developing a blockchain-based identity system that allows people, products, apps and services to interoperate across blockchains, cloud providers and organizations. Many companies are developing preliminary blockchain-based applications for the healthcare sector, starting small but with the potential to contribute to next-generation personalized medicine systems.

IBM is integrating blockchain technology with its Watson AI and IoT projects. Mesh networks of smart sensors for industrial applications, developed by blockchain-oriented IoT startups in collaboration with tech titans like IBM, could prepare the way for Google’s bio-molecular nanotechnology projects.

As with any investment, close investigation and risk assessment is always advised and no single investment is right for everyone. The companies and projects mentioned in this article are only a few examples among many driving a changing landscape. But Swan’s glimpse of the future can be helpful as one piece of the informational puzzle for those who want to learn more about the imminent blockchain revolution.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.