Innovation Blockchain: The Internet Revolution

Even in an incipient stage, it brings transparency and opens the door to many new business models.
One of the most promising emerging trends is the blockchain. This technology threatens business models and opens the door to the birth of others, but its potential goes much further. Some people postulate that blockchain could completely revolutionize the Internet.

Blockchain (literally, chain of blocks) is the underlying technology of bitcoin, the fashionable cryptocurrency. Bitcoin, in itself, is interesting, but it is not a big shock for the bulk of society or the world economy. Not so the blockchain. This allows financial transactions between two participants in a secure, reliable and irreversible, without the need to use an intermediary to establish a relationship of trust between the parties. This elimination of intermediaries allows, in the first place, an evident saving of costs.
In addition, through the blockchain, the data of the transactions are impossible to falsify once registered. Neither can be deleted, and also the database contains a history of each and every one of the operations. "The transactions are public but anonymous, you can not associate anyone," sources in the sector clarify. On the other hand, a blockchain can be public or private. In the second case, the level of transparency is maintained. The difference is that only authorized people can access this network.

What Is It For?

The first sector to start testing this technology was the financial one. But if the main intermediary is banks, where is the business opportunity for these? The blockchain allows registering any type of financial transaction, not just money. Here come into play the so-called smart contracts or smart contracts, which open a host of new business opportunities for entities. "By using blockchain as a source of information, these smart contracts can be valid to guard assets and guarantee neutrality," says Luis Pastor, partner of Technology Consulting and Innovation of Grant Thornton. You can also register bonds, shares, transfer of property and any type of right or obligation. Even total or partial securitizations.
Santander estimates that the use of blockchain technologies can save the sector 20 billion dollars by 2022. And BNP Paribas goes further and dares to compare this invention with that of the steam engine or the combustion engine.

Today, the development of the blockchain is oriented to two fundamental uses: efficiency in business processes, thanks to the application of its implicit characteristics - immutability, traceability, security, robustness, distributed consensus and transparency; and the definition of new business models that meet the needs of consumers and society, fostering platforms based on the collaborative economy and on peer to peer models.

In particular, the industrial sector has discovered that this system makes possible the total traceability of a product, since it is manufactured until it is purchased by a final consumer.

In addition, the energy sector is another of the sectors in which greater activity is being carried out in this area. Here we highlight energy trading initiatives, where the creation of a consortium at European level is already being considered. It is also working on the ideation of new business models around the electric car.

Another industry that has found applications for the blockchain is fishing, specifically, tuna fishing is Iceland. And the pharmaceutical company. And the armament├şstica. And the technological, for the recount of votes of the elections. And the insurer, who finally finds an efficient way to offer microinsurance.

In the longer term, the blockchain can come to redefine our sense of privacy on the Internet. The Nodalblock start up allows the creation of secure digital identities for any digital environment, with technology based on the Ethereum network. In the long term, the blockchain could help generate a unique digital identity for each individual.

This technology will also be key to the deployment of the so-called Industry 4.0. "The machines can negotiate between them, make payments or order supplies by themselves," predicts Oscar Lage, head of Cybersecurity Tecnalia technology center and co-author of the book Blockchain: The Industrial Revolution of the Internet. In other words, factories can be autonomous.

State Of Development

For now, all these are promises. Blockchain is a technology still under construction, with use cases still to be identified and technical and legal challenges still to be solved. It faces, among others, scalability challenges, doubts about its governance and a lack of consensus on its effectiveness and on the ideal levels of privacy.
Smart contracts and financing via tokens are barely four years old. Thus, in 2013 and 2014 the first prototypes were developed, in 2015 and 2016 the proofs of concept, and since 2017, versions 1.0 of the projects are being launched.

In this context, the most advanced entities approach this trend from a multidisciplinary approach. BBVA, for example, does so from the perspectives of technology, investment banking and BBVA Research. The blockchain laboratory in Santander, meanwhile, has about twenty people. And in 2017, Telef├│nica created a Blockchain Competition Center, made up of experts from different business units.

At the moment, "blockchain is in a stage of development 3 or 4 out of 10," said Mar├şa Praga, vice president of the Alastria consortium, during a recent event organized by Abascal Comunicaci├│n. Alastria is an unprecedented initiative in Europe: an independent and non-profit consortium to which more than 200 companies, universities, technology parks, etc. have already joined. International companies and European institutions have turned to Alastria for guidance on this technology.