Since Satoshi Nakamoto’s white paper (http://bit.ly/2Jhb4Ik) was published in 2008, cryptocurrency has exploded into a huge market with a capitalization that has just crossed $200B (again!), despite the brutal 2018–2019 correction. Cryptocurrency use by consumers understandably captures the vast majority of the attention of the press and posts on social networks like Twitter and Telegram.

Growing in the background however, is an industry that is applying concepts of distributed and decentralized technology platforms to enterprise use cases…enterprise blockchain. This fast rising industry is making great progress on solving a range of very big, very hard problems involving digital asset use by companies and multi-party coordination situations from supply chain management to illiquid asset tokenization.

A few weeks ago, Forbes writer Michael del Castillo published a great survey of 50 large companies that were deploying blockchain to solve business problems. (Article: bit.ly/2JpAVgu). We thought it would be helpful to publish an accompanying list of the start-ups, foundations, project groups, etc that are driving the enterprise blockchain industry as well. There has been a flood of exceptional technical talent into blockchain, and there is a lot to cover.

In this list, we are highlighting 100 of the top organizations in enterprise blockchain. The breadth and quality of companies that are using different applications of distributed ledger/blockchain products for enterprise use cases is impressive. Note: If you believe we have missed some promising companies, please email me r@mstate.io with suggestions (that meet the criteria detailed below) for the next version of this list. We hope this post will inspire discussion and debate this week at Consensus.

I . What Is ‘Enterprise Blockchain’?

There is a lot of debate about the definition of what enterprise blockchain is, even among industry veterans. We define it to be distributed ledger technology used for “B2B” / enterprise use cases that commonly have some/all of the following characteristics.

Distributed Ledger — Consensually shared data that is synchronized across multiple sites, organizations or geographies, multi-party use cases.

— Consensually shared data that is synchronized across multiple sites, organizations or geographies, multi-party use cases. Immutable Data — A data record that cannot be altered once it has been recorded.

— A data record that cannot be altered once it has been recorded. Cryptographically Secured Data — Data on the network is secured using advanced data security mechanisms.

— Data on the network is secured using advanced data security mechanisms. No Centralized Authority / Ownership — There is no central authority governing the data network. Instead, there is a governance structure that enables network participants to come to consensus. This topic is widely contested. Some of the most successful DLT networks have some form of central authority, which is needed for many enterprise use cases.

— There is no central authority governing the data network. Instead, there is a governance structure that enables network participants to come to consensus. This topic is widely contested. Some of the most successful DLT networks have some form of central authority, which is needed for many enterprise use cases. Consensus — Blockchain networks have a variety of different algorithms that ensure network participants “confirm” changes / additions to data recorded on the network. This ensures that one participant can’t unilaterally make data changes.

— Blockchain networks have a variety of different algorithms that ensure network participants “confirm” changes / additions to data recorded on the network. This ensures that one participant can’t unilaterally make data changes. Trustless / Trust-Limited — Networks use distributed consensus to facilitate operations and data sharing between counter-parties that have less than 100% trust for each other. However, the counter-parties may not always be completely trustless however. For example: supply chain trading partners that work together regularly and “mostly’ trust each other.

II. Enterprise Blockchain Definition Is Highly Contested

There has been extensive debate about what is truly considered “blockchain” for enterprise use cases. Purists who support a truly decentralized definition argue that closed, permissioned systems with central authority functions aren’t truly distributed/decentralized networks and are just another generation of “extranets”. Supporters of closed permissioned systems argue that even the most decentralized networks have some qualities of centralization (partially because of flawed governance models) and that public, consensus networks can be computationally expensive and inefficient and therefore may not be best suited for enterprise use cases, especially when they are not properly implemented.

Both sides have compelling arguments. Based on what we’ve seen, we believe the future of enterprise blockchain is a middle path between these two viewpoints: interoperable and heterogeneous networks comprised of both types of networks. Enterprises will deploy a range of different blockchain technologies to serve different purposes but all work together. Zero Knowledge Proof technology will likely play an important role in this. We also believe that enterprises may first evolve to “distributed” (already a big cultural shift) and this change will enable them ultimately become more comfortable and open to operating with truly decentralized networks.

III. Enterprise Blockchain Industry Structure

In the conversations the MState team has had with start-ups, Fortune 500s and other investors, we’ve found it helpful to use a very simple framework that divides the enterprise blockchain stack into three layers.

Applications layer is typically built on a blockchain protocol and offer applications that are used by end business users, frequently non-technical.

Infrastructure layer companies offer technology to application layer companies and mostly support multiple protocols.

Protocol layer companies are operating system layer organizations (frequently operated by foundations, communities, etc vs companies) that engage with both infrastructure companies and application companies.

Here’s a diagram of the structure with some representative examples:

IV. Top Enterprise Blockchain Market Trends

After reviewing more than a thousand companies, some interesting trends have emerged. Caveat: Some or most of these will be old news for industry insiders.

Real Business Value Is Being Produced: Blockchain technology is being applied to business problems that are enormous in size (cross-border payments, supply chain data sharing) where existing technology being used is often decades old, batch-oriented and hard to use. Although many implementations are still in “Proof of Concept” (POC) phase, enterprises are seeing meaningful financial benefits in the form of increased revenue and reduced operating costs. We are seeing hundreds of use cases move beyond POC to production. To get regular updates on these, we suggest following Anthony Pompliano from Morgan Creek Digital Assets on Twitter. (@apompliano). We are seeing a rising number of blockchain companies and organizations with revenues in the tens and even hundreds of millions. The enterprise blockchain industry is just getting started, and it is easy to imagine accelerated industry revenue growth in the next 18 months. The Industry Is…Distributed: A large number of the Top 100 list have HQs that are outside of the Bay Area or NYC, with significant concentrations in Israel, UK, Canada and China. A year ago, the Top 100 we produced internally had a stronger concentration towards financial services and digital assets. We have seen increasing category diversification with companies labeled “Infrastructure” and “Supply Chain” rising fast. The rise of “distributed” and “decentralized” also applies to organizations (including some distributed autonomous organizations, “DAOs”). Blockchain companies are increasingly being populated by distributed teams, a global trend we are seeing in the high tech industry as it becomes more and more expensive to build companies in the Bay Area. Early Winners Emerging In The Protocol Layer: Although there is a dizzying range of protocols that raised capital 2015–2018, enterprises are most commonly using Hyperledger (primarily Fabric), Ethereum Public, Quorum (private fork of Ethereum) and Corda. The market leadership of these protocols is compounding quickly and being accelerated by major corporate technology companies like Amazon, IBM, Microsoft, Oracle, and SAP and service firms with system integration practices like Deloitte and Ernst & Young. We would love to see new emerging protocols claim leadership positions, but they will have to execute quickly, provide compelling alternative value (performance, security, etc) and build meaningful developer ecosystems. The ‘Fat Protocol’ theory proposed by Joel Monégro in 2016 inspired a flood of investments by crypto investors and venture capitalists 2016–2018, but it is unclear if the large value creation/capture by this flood of protocols will accrue to many, or just leaders over the long term. (The original post here: http://bit.ly/30b6tMQ) Two Fundamental Use Cases Driving Growth: Digital assets (widely covered as “cryptocurrency”) and the use of blockchain/distributed systems in multi-party coordination use cases like supply chain, global rights management and consumer identity are driving the vast majority of enterprise use cases. Start-Up Funding Shifting Back to Equity: There was an explosion of token-based funding for blockchain companies between 2015–2018, but to date, there hasn’t been enough data to indicate that as a rule, tokens are a superior form of funding to traditional equity. We believe this is because token-based funding usually is associated with a lower level of corporate governance (IE: no Board of Directors), over-capitalization and investor speculation that is not aligned with long term company value creation. We believe that the best answer may well be syndicates of equity funding from high quality VCs that provide company building expertise (and “social proofing” for follow-on funding rounds) and crypto VCs that provide industry & technology expertise as well as connections. We also have been very inspired by Republic’s (www.republic.co) drive to democratize investment in high growth tech companies and would love to see them as a funding source for even more enterprise blockchain deals in the future. Rise of New Organizational Structures: The intersection of new forms of funding, digital assets and team structures are giving rise to some new types of organizational structures that hold promise to be meaningful alternatives to the traditional “command and control” hierarchical structured companies. A great example of this is MakerDAO (www.makerdao.com). To quote a crypto founder: “It is crazy to think that there are thousands of people who wake up every morning to mine Bitcoin and/or build out its ecosystem. In other words, thousands around the world report to…a computer algorithm.” Blockchain As A Part of a Bigger Technology Stack & Solution: The same way that other highly successful technologies like Apache Hadoop, AWS Hosting, Elasticsearch and Kubernetes have been incorporated into larger solutions sold to enterprises, we are increasingly seeing some enterprise blockchain technology leaders accelerate adoption of their products by deemphasizing “blockchain” and instead focusing the positioning of their products around the value that is provided for end business customers. We see this as a positive sign of solution maturation and more use cases moving to Production from POC. There Is Work To Be Done On Gender and Ethnic Diversity: The enterprise blockchain industry suffers from a lack of gender and ethnic diversity that also plagues the broader enterprise software industry. We applaud the efforts of organizations like Crypto Springs (http://www.cryptosprings.org/), Diversity in Blockchain (https://diversityinblockchain.com/) and Women in Blockchain (https://womeninblockchainglobal.org/) to and a wide range of start-up founders and big companies that are working to address this.

V. How We Built The Enterprise Blockchain Top 100 List

The list below was created using publicly available information such as employee count, social media presence and funding raised to date from data sources that included TechCrunch, LinkedIn, Crunchbase, Coindesk, TheBlock, AngelList, Twitter, VC web sites (DCG!), industry conference web sites & more.

A preference was given to companies we have met with and/or researched personally since we have more verified information about them.

We believe this list under-represents companies based outside of the US and we look forward to addressing this in future list releases.

We did not include system integrators, services organizations (unless they had a specific product) or advisor companies although many of them (like Ernst & Young) are doing a lot to drive innovation and adoption of blockchain in enterprise use cases.

Companies needed to have at least 15 employees and have some operations (but not necessarily all) serving enterprise customers.

This size limit meant we had to omit scores of incredible companies and we look forward to including them in future lists as they grow.

The company descriptions were taken when possible from content they themselves had published online.

We circulated this list within our network of advisors for their feedback. Special thanks to Arianna Simpson (Autonomous Partners), John Wolpert (Consensus), Meltem Demirors (CoinShares), Richard Burton (Balance) for contributing suggestions. They are some of the most knowledgeable people we know in the industry and their feedback was very helpful.

VI. About MState

Invests in (and helps build) enterprise blockchain companies, we launched in 2017.

Based in NYC, backed by Boldstart Ventures (www.boldstart.vc) and other leading early stage venture investors.

Reviewed 1,500+ enterprise blockchain companies and met with more than 500 since we launched in 2017.

Working actively with 5+ Fortune 500 companies on enterprise blockchain implementations

Provides active scaling support for its portfolio companies in Product, Sales, Marketing, Ecosystem Development and Fundraising.

Invested in 7 companies to date: Blockdaemon, Caligo Technologies, Amberdata, Oasis Labs, Fireblocks, In-Country and Briq. (Also strategic advisor to Controlant, a digital supply chain IOT company.)

Hosts an annual Enterprise Blockchain Summit in the summer with participation from 25+ Fortune 500s. (email r@mstate.io for more info)

To learn more: www.mstate.io.

VII. Enterprise Blockchain Top 100 List (Alphabetical Order)

Special thanks to Julie Kruger and VSC Consulting for help with edits.