Blockchain technology has been around for a decade now, having published its white paper in October 2008. However, despite the appreciation of the revolutionary power it holds and its ability to change the course of FinTech operations, across the globe, the industry players are still hesitant to its adoption.
In numerous occasions, both startups and multinational companies have cited capital as their hindrance to their adoption of the blockchain technology. But Jonathan Johnson, the CEO of Overstock believes that while capital may be a contributor, it is just part of the problem.
Having framed part of the decision by Overstock to embrace the technology early on and heading a blockchain incubator, Medici Ventures, Jonathan understands the challenges facing the industry. According to the head of a firm that supports blockchain-related startups in the finance industry, voting processes, and supply chain registries, here are the three key challenges derailing massive adoption of the technology:
The Limited Number of Blockchain Developers
Jonathan points to human capital as the biggest challenge to the mass adoption of blockchain technology. While the increased dependency on computerized technologies has increased the demand for software engineers, few have taken interest in blockchain technology.
The fact that it is still considered relatively new makes it difficult for every company looking to embrace it find specialist developers to help them install and maintain the technology. While some institutions have rolled out training programs for blockchain technology, Jonathan appreciates that it will take time to build enough human capital to help spread the technology.
Interference from Governments and Related Agencies
Initiating the blockchain conversation at the national level by the government is healthy and of immense benefit in spreading awareness about the revolutionary technology. However, the push and pull between technology industry players and legislators and the resulting clamor for regulation have also played a key role in delaying its massive adoption.
The fact that the fate of the technology, with regards to regulation, hangs in the balance has also stifled innovations in the field. For instance, the SEC in the United States has initiated a crackdown on U.S-based ICOs arguing that the tokens on offer are a form of securities and thus fall within their jurisdiction. Such a move discourages investments and entrepreneurship, two key factors to the popularization of the industry.
Jonathan also believes that the world’s view towards blockchain technology, though based on ignorance, has also derailed the adoption of the technology. This implies that most people cannot differentiate between digital currencies like bitcoin the anchor blockchain technology in which they are founded on.
The approach to the digital currencies as yet another speculative form of investment has not done much to help. This user mindset has since defeated the intentions of its creators and only gaining popularity among speculative investors.
Addressing these critical issues would go a long way in taking blockchain mainstream. Jonathan holds the opinion that the massive adoption is doable but will only happen when everyone stops talking about the technology and starts using it.