Quick Answer: What Are Suitable Projects for

Blockchain Technology?
Published 9 January 2023 - ID G00773015 - 4 min read
Whit Andrews
Initiatives: Enterprise Applications Evaluation and Selection

Blockchain is valued in use cases that depend on participants who

wish to automate transactions perfectly without relying on prior
trust. Applications and software engineering leaders seeking such
use cases for blockchain technology should consider these three
kinds of applications.

Quick Answer
Quick Answer: What are suitable projects for blockchain technology?

■ Payment settlement: Blockchain technology enables cryptocurrencies of all

kinds, whether intended for general use or for simpler private value exchange. Its
ability to provide generic fungible tokens with strong security attracts entities to
its efficient, private and potentially swift resolutions.

■ Goods and materials provenance: Units of commodities such as foods,

chemicals and components travel through extremely complex processes that
depend on supplier trust and relationships. Blockchain offers better means of
codifying the necessary metadata to know key facts about individual units’ origin
and legitimacy. Better provenance can be useful for improving brand value,
enhancing safety or satisfying regulatory needs.

■ Supply chain execution: The number of participants in busy and complex

multiparty supply chains is in hundreds; documentation, resolution of truth and
process transparency are a persistent challenge, much of which remains beyond
the reach of IT. Blockchain offers the opportunity to leapfrog one or more storage
and transactional practices, and move to better means of managing data to the
benefit of stakeholders at multiple stages and in multiple roles.

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 More Detail
The blockchain projects that depend on the technology’s unique aspects for their genesis
and pursuit are the projects that persist. Projects that were founded on novelty or flashy
marketing demonstrate less durability and are less likely to continue past initial
investments.

Gartner sought out blockchain projects that had been publicized since 2018, when
blockchain fluttered at the top of the Hype Cycle. Self-reported adoption of blockchain, as
measured in the CIO survey, has increased by a proportion of about 20% each year
recently — from 3% in the 2019 Gartner CIO Survey to 8% in the 2023 Gartner CIO Survey.
While the growth rate is robust, the overall adoption that represents obviously remains
modest and more than 40% of CIOs still indicate they have “no interest” in blockchain.

We recommend that the organizations deeply consider the purpose of selecting

blockchain to avoid failures based on faulty premises. Elements where blockchain offers
unique value include:

■ Multiparty transaction resolution, documentation and visibility. No technology before

blockchain offered the same class of ease for allowing participants in a system to
trust the records of their activities without needing to trust each other’s motives and
interests.

■ Immutability in consensus. Blockchain also allows its users to be confident that the
records in the system have not been altered. This owes to the use of strong
cryptography to watermark data and to the wide sharing of records such that
alterations are immediately exposed as faulty or deceptive.

Blockchain’s future will likely include many novel ways of employing it to make new
products. Non-fungible tokens (NFTs) can represent unique assets in volume and scale,
which was previously impossible, and if they reside on widely employed and useful
blockchains, their broad accessibility can increase their value and reach.

But for now, the above factors single out particular markets that can derive enough value
from blockchain immediately such that the projects could be welcomed immediately. Also,
because blockchain is essentially a network technology, use cases that provide benefits —
financial and operational — to more participants are more attractive. Returning value to
multiple parties in an ecosystem is key to success.

This includes the following examples:

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 ■ Payment settlement: The ability to produce perfectly unique assets that can be
pooled, tracked, shared and transacted with is blockchain’s original brief and
represents its most obvious use. Multiple projects from significant enterprises with
the interest that payment resolutions remain in their control and not skid into largely
unregulated realms meet this description. International banks seek to use blockchain
to reconcile transactions using mutually acceptable cryptocurrencies. Other markets
that settle the completion of transactions involving securities use blockchain tokens
to serve as a proxy for the real property. Nascent transactions marketplaces in some
cases are turning to blockchain as a way of shortcutting more traditional systems.
Novel currencies, such as carbon trading units, could be handled in blockchain
realms.

■ Goods and materials provenance: Consumers and organizations pay more for
aspects of commodities that are difficult to certify and track, such as the
commodities’ legal or humane provenance. Some commodities owned by rival
organizations actually travel in shared physical or digital realms (such as liquids,
minerals and money). Blockchain offers unique scale and unique security to serve
the needs of such entities. Brands that depend on the perceived virtue of the
products that they retail, whether in compliance with national law or cultural
expectations, can turn to blockchain independently of its currency implications to
codify and preserve intangible value of commodity units.

■ Supply chain execution: Participants in supply chains are numerous and sorting out
disputes or simply documenting activities is intensely demanding. Lacking in many
cases is simply a shared language of authentication, measurement, transaction
settlement and completion. Consequently, organizations can use blockchain to serve
as a substrate into which such documents and process automations can be fixed.
Blockchain can allow for fewer errors, possibly remarkably fewer when old systems
are discarded, as well as much better transparency and thus more effective system
analysis.

Recommended by the Authors

Decision Tree for Whether Your Project Is Right for Blockchain (Presentation Slides)

Quick Answer: How Is Blockchain Useful in Finance?

Top Five Reasons CIOs Should Care About Blockchain

 Hype Cycle for Blockchain and Web3, 2022

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 Emerging Tech: Emerging Use Cases in Blockchain-Based Tokenization

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