Blockchain, an opportunity for Spanish companies beyond finance

With blockchain technology, concepts are sometimes distorted. Whether it is intentional or not we will never know, but often there seem to be parties interested in not letting us see all the potential that blockchain can bring to the era of digitalization in which we are immersed.

 Blockchain can be defined with three words: resilience, reliability and value transfer. These three characteristics must be complemented with distributed and decentralized systems (architectural decentralization). Encrypted systems, immutable and, of course, there must always be a token.

When asked if any of these characteristics can be sacrificed with business models in mind. The answer is simple: no. None of them. The blockchain concept is one, not several. Although it is true that any DLT is not a blockchain, it can fulfill many of its characteristics and serve a multitude of purposes. But it cannot be considered a blockchain as such. Nor does it serve the same purposes, although it would fulfill a series of functions that would result in similar projects.

Analogy with Internet and Intranet

As a consultant, many times, the biggest effort is to make understand the client the sense of using a public blockchain instead of a DLT system. The analogy with the Internet and Intranet of the early 1990s is obvious. Today, the globalization of technologies is above their privatization. Unfortunately, we still suffer from a certain anachronism as far as technology is concerned. The word innovation still generates doubts and the bet on it is anecdotal. Finding companies with enough vision to understand the meaning of a public blockchain and with the financial capacity to face the process is very difficult.

I work in an IT department of the financial sector and I know that there are many developments based on the words "digitalization" and "blockchain" that serve to optimize banking processes. But almost all managers interested in seeking improvements for their company and cost savings through technology, are on the other side of the Atlantic. In Europe, we often regret that the owners of the world are the others, those who live in large American or Asian metropolises. But this is something that we will never achieve from old Europe if we insist on continuing with our old-fashioned financial businesses. Much less if we do not show interest in innovating our businesses.

Adaptability

In the case of the financial sector, if it continues to turn its back on technology, it will probably die at Fintech feet. Much more flexible to adapt to everything new. For example, with decentralized finance (DeFi), where there are products as attractive as “flash loans”. 

But the blockchain tsunami goes beyond finance. In logistics, processes and procedures are still done on paper and by hand, because no one has bothered to use technology to make them more efficient. Nor has anyone bothered to show the customer a service that offers reliability and truthfulness in the transactions executed by logistics operators.

Of course, it is not necessary to apply blockchain to improve many of these processes, although there is the technology to use it if necessary. What is really missing is the courage and open-mindedness to do it. Qualities that are hard to find in European and Spanish production environments.

Poland, Greece & Portugal invests more money in R&D than Spain

In Spain, we have just been overtaken by Poland in investment in R&D. With such a desolate panorama, trying to develop blockchain projects is complicated. And much more, if we want them to be carried out with quality and following minimum technical requirements. Unfortunately, we are seeing more and more mediocre or hybrid developments, with a certain similarity between them. In a fortnight's work we cannot obtain the same results as other developments from countries where teams have been working for months or even years.

Blockchain is neither expensive, nor is it a demanding technology. Neither is it an invention to get more money from the technologists. Blockchain requires implementation time, careful development and specific knowledge of different disciplines. The legal and technical fields are the base and to them we have to add the specialists of the sector in which we want to implement the project. Whether it is logistic, financial or of any other sector.

Improve productivity

Implementing blockchain developments should be the basis for projects that enhance and improve business productivity in the short and medium term. Of course, always complying with the essential characteristics that allow the use of blockchain for a change of paradigm in all sectors.

The blockchain technology is more than ready to create efficient and effective business models in almost all areas of society. Unfortunately, we can consider this as a fiction in an environment where the bet on technologies and the advances of this century are left aside in favor of old-fashioned businesses. Those, where instead of looking for equity between all parties, they continue to look for ways to squeeze the most out of those who have less possibilities or are in a worse situation.