Blockchain Needs a Design-Driven Approach and for Everyone to Take a Deep Breath
The hyperbole around blockchain has often bordered on the absurd. Headlines such as ‘Blockchain could be the Savior of Free Speech’ and ‘Yes, Blockchain could reverse the course of civilization and upend the world's most powerful companies’, have created the impression that it will be a panacea for all of society’s ills. This would be nice, but we have some way to go before anyone can say it with anything like the certainty that many do today.
We must ensure that the right environment is in place for it to flourish – that research is funded, collaboration encouraged, talent nurtured and enterprise strategies for implementation put in place. Binary District Journal spoke with Cindy Mallory, emerging technology strategist and developer at digital product and innovation studio, Jakt, about the future of blockchain, obstacles that need to be overcome, and why it’s important to take a design-driven approach to development.
An Idea or a Tool?
Blockchain is often referred to as a solution without a problem. If you were to base your perception of blockchain solely on white papers, you could be forgiven for believing that blockchain is more ideology than technology, more a vision of the future than a tool to achieve it.
However, such white papers are only a small part of the blockchain scene. Many established companies, including banks, are – whether the technology’s more libertarian acolytes like it or not – investing heavily in development. And they are entirely right to. To not do so could have the same dire financial ramifications as those seen by companies late to the Internet.
“MasterCard just invested $100 million into blockchain, for making their transactions more secure.”
“MasterCard just invested $100 million into blockchain, for making their transactions more secure,” Cindy notes. “It’s definitely still in its early days, but I am shocked if companies that do their due diligence aren’t going into blockchain for finance in some way.”
Cindy highlights a number of applications, many of which are solving issues fundamental to a flourishing society. One is medical. “Medichain is really awesome,” she says. “It’s a nice cooperation between the insurance companies, research institutions, patients and researchers.”
“In this economy, participants are incentivised to share their information in a confidential way. So, insurance companies can make better plans to suit their patients. Researchers are also actually rewarded for sharing their intellectual property and research. That’s an amazing thing I see moving forward.”
The energy industry is also prime for disruption from blockchain. “Blockchain applications for the environment are also arising,” Cindy says. “Any sort of blockchain grid work, where you can share and allocate energy, is really exciting.”
Blockchain also has the potential to transform business, albeit perhaps without much glitz and glamour. “The ability to have a blockchain set up on a private ledger and have all thousand of your desktops update at the same time – that doesn’t sound so cool, but you could very easily implement that and keep all of your security for your company intact”, Cindy says.
Automated Trust for the Future of Enterprise
Business runs on trust. Blockchain essentially automates trust, removing the need to rely on middle men who have traditionally filled this function and could, for whatever reason, let you down.
Nowhere is trust more important than in the supply chain, one area where blockchain is developing the fastest. It holds the potential to improve transparency and traceability as well as slash administrative costs.
“The biggest thing I see in terms of actual projects is tokenisation for authenticity,” says Cindy. “Medical marijuana is a big one, I know there are a few blockchain projects going on right now where you can authenticate where something was grown, how it ends up on the shelf, etc.”
“Walmart worked alongside IBM to track ‘a mango from its growth to the shelves. Using normal tracking systems it took two days, but with blockchain, it was a matter of minutes.’”
Cindy cites the example of Walmart. The US giant worked alongside IBM to track “a mango from its growth to the shelves. Using normal tracking systems it took two days, but with blockchain, it was a matter of minutes.”
“That could be used when there is an e-coli outbreak – if you know exactly which crop the contaminated food came from, and what shelves it’s on, instead of having to throw out millions of dollars of produce, you can get rid of the specific amounts.”
This is particularly important in the global economy, with the issue of fake products exceptionally hard to monitor across disparate countries and continents. “Blockchain could even be used when things are priced differently in different countries”, Cindy explains. “Let’s say you have a scarf that they sell in China for $200, but the same scarf with the same materials is sold to US markets at $600. How can you prove that it’s the authentic scarf if someone brings it over from China? Blockchain could be used for that. There are so many use-cases for it.”
Gaming on Blockchain?
Before Jakt, Cindy worked as CMO and VR Game Developer at DreamSail Games, creator of award winning titles such as Blade Ballet and The IOTA Project - a VIVEPORT game played in 37 VR arcades across six countries. Her focus at DreamSail was virtual reality development – defining, analysing, and documenting requirements for game creation with emergent technology.
Games play a key role in the early evolution of any technology. It did so with computers, with the internet and with VR. And it is already doing so with blockchain, particularly in second-life environments.
“In secondary economies, tokens can be used when you level up things, or in-game purchases,” Cindy says. “Besides gaming tokens, there are also use-cases for ad pay. You can tokenise them to watch more ads in your game.”
There is even potential for games to run on blockchain, for example CryptoKitties. “I know CryptoKitties broke the blockchain because of transaction rates,” says Cindy, “but by gamifying the user experience on blockchain applications, I think there is a lot of potential.”
“Games could also be a way of helping people acclimate to blockchain, as they have with other emergent technologies.”
Such games could also be a way of helping people acclimate to blockchain, as they have with other emergent technologies. Many early Windows games, for example, were created by Microsoft to help people get to grips with using computers.
The makers of Windows say Solitaire was actually created to familiarise computer users with the 'drag and drop' feature of the mouse. Developers wanted users to develop speed and precision when using the mouse and for making left and right clicks a natural habit. Hearts was a way to introduce people to the concept of networking, as they could communicate with other Hearts clients on a LAN. Gaming on the blockchain could be used to similar effect.
Issues to be Overcome?
Blockchain is, however, still severely limited in terms of what it can currently do. The size, transaction rates, energy usage and even the cost of running transactions on the blockchain are all tremendous hurdles to overcome.
“Blockchain is still in its infancy,”Cindy explains, “very much like VR was when we were working on Oculus in 2016. With the issues with transaction rates, I know there are companies looking at doing double chains, which are very small, short chains. We can do off the chain things and second layers. There are a number of companies exploring scaling blockchain projects on Ethereum through sharding.”
“There’s going to be improvement. It’s just like with the Internet. It was so slow when it first started, and completely janky. With AWS, they had the templates for Hyperledger and for Ethereum, so it’s even easier for devs to build. It’s still early but there’s a good future.”
A Design-Driven Approach is Key to Blockchain’s Success
One of the main obstacles for blockchain to overcome, as with any new technology, is the disillusionment that comes after the hype.
There is a tendency in business to go to great lengths to implement a technology even when it is not needed, which leads to them trying to hammer a square peg into a round hole. Then leaping angrily up and down on the peg. Then burning the pile of splinters that’s left after their assault and swearing to never look at a square peg again, even if they have square holes to slide it into.
Cindy argues that the key to overcoming this is adopting a design-driven approach.
“So Jake Knapp wrote this book – he worked for Google Ventures – and it’s about design thinking,” she says. “Design thinking is just a process. You have the traditional waterfall, where the people at the top say ‘I want this product’, and the people right below them, the heads of engineering, say ‘these are all the features’, then it just falls down.
“With design thinking, the first thing you do is empathy mapping, where you try and think of the problem you’re trying to solve and what is the user experience, how does the user interact, what’s the user interface going to be like, how do we use technology to get them the solution? Through reiteration, and thinking about it in this way, it makes much better products for any sort of tech, including blockchain.”
“The big thing I saw with VR and blockchain is: just because you can put it in VR and just because you can put it on a blockchain doesn’t mean you need to or that it’s actually better that way.”
“By approaching blockchain development with design thinking, you aren’t going in thinking ‘I want this blockchain app with these features.’ You’re actually trying to solve problems, and if blockchain works for that solution then that’s great.”
“By approaching blockchain development with design thinking, you aren’t going in thinking ‘I want this blockchain app with these features.’ You’re actually trying to solve problems, and if blockchain works for that solution then that’s great. It’s very important that companies are conscientious with what they are building.”
Regulators Playing Catch-Up
Another unfortunate downside of the hype around blockchain is that it attracts scammers and chancers looking to make a quick buck. Unfortunately, in many countries, regulators are still struggling to keep pace with developments.
China went to the extreme of banning blockchain-related projects and even talks while they figured out how to regulate them – a move that has both positives and negatives – but many other countries also seem uncertain of how to deal with it and seem lost.
“When you think of any startup – if it’s a token company or any sort of tech company – 90% of them fail, we already know this,” Cindy says. “But then you add to it that there weren’t SEC regulations – there were issues about declaring and securing utility-backed coins. Also, there were people who did huge raises and nobody held them responsible to show that they were using the crowd-raised money to build what they said.”
Even America, which has taken a tougher stance than some, is behind the curve. “There are a lot of loopholes,” Cindy believes. “A bunch of Americans are building but actually have their blockchain company based in South Korea, or they just have the company in a place that is kinder to crypto to get around the tricky regulations.”
“At the same time, you see people doing enterprise, like ConsenSys, who are building projects around a blockchain that already exists. Because they’re not trying to raise, and it’s not tokenisation to create a currency, they’re OK. It’s just going to be a matter of time.”
“The US classes crypto as a capital asset, so it’s the same as bonds or stocks versus currency. That changes how you can account for them on your taxes, even. So, there’ll be a lot of shifting and figuring things out.”
“A lot more people will end up in prison from bad practices, because you are raising people’s money. There are people doing pump and dumps – those aren’t allowed. There’s insider trading which isn’t allowed for normal companies, why should it be allowed for blockchain?”
Somewhere Over the Rainbow
Cindy does, however, believe that despite the hurdles that stand in its way, eventually blockchain will get there.
“I feel that as regulations become more enforced, and we develop best practices and standards for these things, it will get better. We’re still definitely in the early adopter stage for building blockchain and for using it. But, I feel that unlike, for example, the 3D television, which was pushed by a very specific vertical, there are so many use-cases for so many different industries that it will win out.”
“[Blockchain] unlike, for example, the 3D television, which was pushed by a very specific vertical, there are so many use-cases for so many different industries that it will win out.”
It’s definitely an exciting time to be in the space and there is some tremendous research being done and real-world applications beginning to emerge. We all just need to be wary of getting too carried away – be patient, adopt a considered, design-driven approach and ensure that investment is directed to the right places.
Industry professionals tend to agree with Cindy. A 2018 Deloitte report saw 59% of over 1000 respondents somewhat or strongly agree with the statement “Blockchain technology will disrupt our industry” and 74% said their “Executive team believes there is a compelling business case for use of blockchain technology”.
That being said, there are still the seeds of discontent inside the industry. With 39% of people in the same study believing that “Blockchain is overhyped”, there is still a long way to go for blockchain to generate the same level of confidence that other more established platforms have achieved. Of course, one has to consider that this lingering doubt is largely due to many people’s continued lack of exposure to the technology in their day to day lives. How soon will this realistically change?
Illustrations by Kseniya Forbender
To contact the editor responsible for this story:
Margarita Khartanovich at [email protected]
- How Blockchain Can Reshape Charitable Donations
- Blockchain’s Scaling Crises: Can Sidechains Be A Potential Solution?
- Hacking Blockchain: Is it Really Secure?
- Regional Strengths Are Shaping AI’s Evolution in Asia
- Credit Card vs. Bitcoin: How Do You Pay for Your Coffee?
- Do You Trust AI? This Is What You Must Understand to Do So