TOP 5 CURRENT BLOCKCHAIN TRENDS FOR 2020 AND BEYOND
Blockchain technology is starting to find its way into many different corners of the world. Now, it is the basis for many things from bitcoin exchanges to E-voting systems. It’s being used and developed in ways that many weren’t expecting when it first hit the internet over ten years ago. Here are 5 of the most relevant blockchain trends right now, and what they mean for those interested in the development of blockchain technology.
1. BLOCKCHAIN DELIVERED BY
ENTERPRISE TECH COMPANIES
Blockchain was originally invented as a way of decentralizing money and finance and putting it in the power of people. The original whitepaper describes the purpose of the first blockchain as a way of departing from the traditional financial institutions.
Right now, that trend seems to be reversing. More and more enterprise technology and financial companies are developing their own blockchain products. The intent of many of these is to deliver the benefits of blockchain technology as a service. Amazon is one example of a large corporation offering blockchain as a service. Their managed blockchain platform lets users build scalable blockchain networks using frameworks such as Ethereum and Hyperledger. IBM is another company offering blockchain services to help companies integrate into the multi-cloud business environment we currently live in. These kinds of services are designed to allow easier access for businesses into innovative new technology.
Whether this will work on a large scale or not is yet to be seen. One of the major appeals of blockchain tech is that networks exist separately from any large government or corporation. It’s clear that many don’t want to miss out on the boom of blockchain, and this trend will continue in the near term at the very least.
2. DECENTRALIZED FINANCE (DEFI)
Decentralized finance is one of the most exciting trends in the blockchain. It’s the systematic reinvention of traditional financial products we typically rely on banks for. Things like insurance, loans, and exchanges are being turned on their heads by decentralized finance.
Some of the core traditional financial services we expect to go through a mediator or company. For example, when you want to lend money, you usually go to a bank. When you want insurance, you go to an insurance company. When you want to exchange money, you go to a centralized exchange. Defi is changing this paradigm with networks that have no central point of control or real owner.
To lend money on a Defi network, you connect directly with peers through a protocol. You don’t need to call up a bank. The protocol is an agreement between equal parties that connects lenders directly with borrowers. Kind of like borrowing money off of a friend, but scaled to a global level and formalized on the blockchain. An example of a blockchain lending platform is Nuo. You can deposit crypto assets and earn interest as your money is lent out to other users.
Another example is with currency exchanges. Decentralized exchanges are making it possible to trade and exchange currencies without opening an account on a traditional exchange and verifying your identity. The friction to make trades on these platforms has the potential to be minimal.
Right now, these decentralized financial applications are still in their infancy and not quite ready for commercial use. But, there is a strong trend towards these platforms we can expect to continue, even as more centralized blockchain technology continues to develop in parallel.
One of the big trends in cryptocurrency is the demand for stable-value cryptocurrencies. It turns out that investors and traders love cryptocurrencies that don’t skyrocket and plummet in value at the drop of a hat. In fact, Bloomberg recently reported that the stablecoin, Tether, is actually the world’s most used cryptocurrency. If you think about it, this does make sense, as most traders are trading between US Dollars and cryptocurrencies. So, Tether makes sense as an intermediary.
However, Tether doesn’t have the best reputation in the industry. A few scandals involving the company behind Tether have caused many to rethink their faith in the world’s most popular stablecoin. Now, there are a few new players on the block looking to steal some of Tether’s thunder.
Projects like TrueUSD are building stablecoins that focus on transparency and trust, just as blockchain projects should. There is competition in the space due to the growing trend, which is good for consumers as products get better and more reliable.
4. INTERCONNECTION OF BLOCKCHAINS
One thing that has become clear in the blockchain world is that there isn’t going to be one blockchain to rule them all. Blockchains are best when they are built for a specific purpose, e.g. scalability or security. So, we are seeing more and more of these blockchains pop up for different reasons.
This is giving rise to the trend of blockchain interoperability. There’s no reason why blockchain should have any trouble interacting with each other, unlike banks and financial institutions. So, many blockchain technology projects are looking to make their blockchains as interlinked with other chains as possible.
There are even projects dedicated to building ecosystems of blockchains. Cosmos is a whole network of blockchains that aims to solve difficult blockchain problems like scalability.
5. BLOCKCHAIN WITH THE INTERNET OF THINGS (IOT)
One of the biggest trends in the world right now is the soaring number of internet-connected devices or IoT. These need a secure and reliable way of communicating with each other. Blockchain is shaping up to be a core underlying technology for the internet of things.
Blockchain enables devices that aren’t connected with the same software to communicate in a trustless way. This has the potential to create vast interconnected networks of ‘things’ all over the world and help our world run more smoothly. It’s an exciting trend that’s going to continue in the near future.
Blockchain is such a foundational technology that it’s being used in many different ways and industries. These are just 5 of the biggest trends in blockchain right now. Stay tuned, because we have no idea where things will go from here!
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FAQ ABOUT BLOCKCHAIN TRENDS
Is blockchain a trend?
For sure! Research and advisory firm Gartner listed blockchain as one of the top ten strategic technologies for 2020. Most likely, this technology trend goes even way beyond as thousands of DApps (decentralized applications) become mainstream right now.
Is blockchain dead in 2020?
For sure NOT! Blockchain technology already revolutionized the financial sector. With the implementation of the Bitcoin the world has changed. Many developers, users and big organizations have started to see the real benefits of blockchain technology.
What’s the future of blockchain?
The future of blockchain is very bright. Right now we see blockchain becoming mainstream and not just in the financial sector. Track and trace applications are on their way same as tons of DApps.
What is blockchain in simple words?
Blockchain is a distributed ledger, filled with information (assets) and sent over a network of computers using crypto-hash. A simple but powerful piece of code. Blockchain makes distributing assets over the internet safe, fast, reliable, trustworthy and transparent.