Blockchain: lots of hype but little delivery

Banks, fintechs and payment solution providers have injected billions of dollars into blockchain based-projects, but according to a new report from the World Economic Forum and Accenture few projects have actually delivered the expected results.

The report is based on a worldwide survey of 550 individuals across 13 industries and an analysis of 79 blockchainAn unchangeable digital record where transactions are processed and verified by a network of independent computers rather than by a single referee. This decentralised structure has been described as an open distributed ledger. It supposedly enhances security as there is no single entity to be hacked. It also protects personal identity and guarantees that governments can’t block transactions or otherwise manipulate the payments space. The blockchain is the underlying technology supporting most ... More projects.

Global spending on blockchain projects is forecast to reach $2.9 billion in 2019, and $12.4 billion in 2022. In April, a World Economic Forum report showed that over 40 central banks are researching distributed ledger technology for a variety of use-cases.

Cryptocurrencies are perhaps the most widely discussed blockchain-based solution. Blockchain is also at the core of the recent Libra initiative.

Survey respondents expected a 24% return on investment on average on their early blockchain projects, but realized only a 10% return and 59% said they had little confidence the projects would generate a positive return on investment. Furthermore, 42% of respondents expected a noticeable or significant brand improvement from simply announcing a blockchain project, with that total jumping to 87% upon delivering a blockchain project.

Reuters reviewed 33 blockchain projects in the banking and financial services industries, announced over the past four years and also concludes the technology has yet to deliver on its promise.

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