Blockchain Adoption: An Industry-by-Industry Update

Leaders across a wide range of industries firmly grasp blockchain's transformative potential, but each sector is finding its own ways to leverage the technology’s possibilities.

Blockchain appears to be entering a new era of wider, more practical adoption as even previously reluctant leaders begin to comprehend its long-term potential. An increasing number of organisations across more sectors are expanding and diversifying their blockchain initiatives, according to respondents to Deloitte’s 2019 global blockchain survey. However, it remains nearly impossible to generalise about adoption as no two industries appear to view the distributed ledger technology identically in terms of its likelihood to advance companies’ respective strategic priorities. Although each industry’s blockchain journey is unique, executives across the board are keen to understand and more fully explore the technology’s myriad potential.

Financial services.

Years after bitcoin introduced the world to blockchain, the technology continues to change the financial services industry in ways quite distinct from its original cryptocurrency-driven applications. The very nature of blockchain is well suited for financial services, whose lifeblood is multiparty transactions. In the past few years, companies have explored blockchain use cases to streamline and facilitate performance in such areas as digital payments, data validation, “know your customer”/antimoney laundering, tokenised assets, asset transfer, trade finance, letters of credit, title protection, and beyond. In a highly regulated and somewhat conservative industry, a mindset shift toward blockchain as a driver of new business models and revenue streams may take time, with lingering challenges including speed, privacy, and scalability; at the same time, financial services companies have generally shown willingness and ability to adopt new technologies to disrupt the status quo.

Technology, media, and telecommunications (TMT). The ways that any indi

vidual TMT sector uses blockchain tend to be situational. For example, telecom may use blockchain to reduce roaming and other kinds of fraud, while media companies are using it to enforce digital rights and payments to content creators. This is just the tip of the iceberg: TMT respondents lead all industries in prior 12-month blockchain investment of at least $5 million (45%) and future 12-month investment of at least $5 million (49%). TMT leads all other sectors in the survey in either having already brought blockchain into production or planning to within 12 months, at 77% in combined total; moreover, TMT respondents lead in currently hiring blockchain talent, at 56%. TMT also appears ahead of other sectors in consortium participation (current or planned), belief in the scalability of blockchain, and the perception of compelling use cases as they pursue blockchain’s potential in driving value, trust, and transparency.

Life sciences and health care.

There may be nowhere that blockchain can have more immediate, consequential impact than in life sciences and health care, where data transparency, speed of access, immutability, traceability, and trustworthiness are vital. Already, industry participants point to blockchain’s broad impact in such areas as clinical collaboration, claim submission and adjudication, longitudinal patient data, informed consent management, patientreported outcomes, and beyond. Respondents cite data access and sharing as their most preferred blockchain use cases, yet they name interoperability and implementation as top adoption roadblocks. Given the degree of government oversight, regulatory concerns represent another challenge, especially in such areas as financial reporting and privacy. While adoption remains relatively nascent, the industry is demonstrating commitment through planned investment - especially in blockchain talent—considerable consortia formation, and generally favourable attitudes toward the technology.

Energy and resources (E&R). Proofs of concept are underway in a wide range of E&R areas: metering, billing, and security; decentralised energy trading; wholesale energy trading; access to wholesale energy markets for end-use customers; green certificates and carbon trading; grid management; internet of things-based asset management; and e-mobility. These projects currently tend to be toward the downstream end of the value chain; upstream processes tend to be more capital-intensive, with concerns about blockchain integration with legacy systems perhaps making it a tougher sell. Survey respondents identified security and talent as two key obstacles, as well as scalability, speed, cost of development, and regulatory concerns. Only 40% strongly believe blockchain will enable new business models and revenue streams, and 12% say their companies have brought blockchain into production, the lowest ranking among the survey’s industry groupings. There are, as noted, pilots in development, as well as efforts to drive blockchain consortia activity, perhaps in an effort to spark greater adoption, but blockchain has yet to make a truly evident impact within E&R.

Manufacturing. Blockchain capabilities may help relieve common supply chain pain points. For example, the technology’s auditability may allay concerns about traceability. It can lessen compliance issues given the immutability of all transactions. Smart contracts can provide supply chain organisations situational flexibility. Disintermediation can help facilitate trusted peer-to-peer transactions. As such, the industry is embracing a wide host of use cases ranging from tracking and tracing to purchasing platforms to stakeholder verification (“know your supplier”) to supply chain cybersecurity to counterfeit prevention to warranty management, and well beyond. Sixty-five percent of manufacturing respondents call blockchain a top-five priority, and 63% (second only to TMT respondents) say smart contracts are highly important. Finally, 34% say they have led or plan to lead consortia, compared to 25% overall. Suffice to say, blockchain has the potential to play a prominent role in accelerating supply chain evolution.

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When it comes to blockchain, each industry is shaping its own narrative to suit individual qualities and needs. Such is the versatile character of the technology, which is finding expression in a wide variety of use cases, attitudes, concerns, and perceived obstacles across industries as each sorts out the most sensible path to blockchain adoption.