When most people hear the term blockchain, they immediately think bitcoin.
And, there’s a good reason why the two are used almost interchangeably by much of the public as well as the media. Blockchain technology was invented by the pseudonymous Bitcoin creator Satoshi Nakamoto in 2008 as the public transaction ledger for cryptocurrency.
USE CASES FOR BLOCKCHAIN IN BUSINESS
Blockchain is still most widely known for its use in the cryptocurrency space, but its utility crosses a wide range of industries because it offers an end-to-end encryption of data coupled with transparency into transactions. The tech also helps facilitate collaboration by offering interoperability between different data management systems used by companies engaged in a transaction.
All of these factors mean blockchain is being deployed across industries. One area is the murky ad tech space where buyers and sellers of digital advertising have had to rely on intermediary technologies, which allow for ad fraud and other issues. Online ad blockchain transactions provide transparency that ensures advertisers they are buying ad space on valid websites.
Transportation, shipping, and logistics is another area where blockchain is making inroads through offering security and visibility into tracking supply chains and shipment capacity and transparency into the data around shipped goods. Most data-centric business processes that require trust traditionally provided by middlemen, such as financial transactions, have blockchain applications.
Dallas Innovates recently reported Dallas’ Jeremy McKane, an artist and director, is using blockchain to secure oceanic measurements as part of The Ocean Fund, a project designed to protect the oceans. And Dallas-based transportation management services and logistics company Transplace announced it joined the Blockchain in Transport Alliance, with its Chief Technology Officer Mike Dieter taking a seat on BiTA’s Standards Council Board of Directors.
It has even been suggested that blockchain tech could be the solution that will enable secure, encrypted and transparent digital voting.
HOW BIG IS BLOCKCHAIN?
According to the International Data Corporation, 2018 is shaping up to be a big year for the tech with global spending expected to reach $2.1 billion, rising to $9.2 billion by 2021. And Accenture’s recently released Technology Vision 2018 report found 80 percent of global survey respondents expect to integrate blockchain within the next three years. The expectations among Dallas business and IT execs was even higher at 93 percent
Given those numbers, it’s no surprise Dallas-area companies are already integrating blockchain into their businesses. Read on for a cross-section of companies that are on the forefront of blockchain ranging from cryptocurrency-based business models to personal storage services.
DFW BUSINESSES ON THE FOREFRONT OF BLOCKCHAIN
Bid Ops helps procurement buyers conduct multi-vendor contract negotiations through its sourcing acceleration platform using private blockchains to manage the transaction ledgers between vendors and buyers. The reason Bid Ops integrated blockchain into its platform is the tech is a more efficient database architecture for its customers CEO Edmund Zagorin told Dallas Innovates. For Bid Ops blockchain serves as a decentralized ledger instead of a digital ledger located within a database.
“The technology is still very young, and it may change quite a bit before it hits a major growth spurt.”
In a way, Bid Ops is getting ahead of the game in its business sector at a time when payment and financial technology businesses are becoming more interested in blockchain. Zagorin said the company believes procurement and purchasing departments are poised to take the technology more seriously.
“The technology is still very young, and it may change quite a bit before it hits a major growth spurt,” Zagorin said. “Ten years from now will we still be calling it ‘blockchain’ as a separate entity, or will it simply be another tool in the IT architects’ toolbox?”
Comparing blockchain to artificial intelligence adoption, he said if the tech can add efficiency to doing business it will “join the toolbox” whether or not it is a visible part of the user experience. Zagorin thinks people will begin to realize that cryptocurrencies and blockchain are two different things with many uses for private blockchains that accelerate existing business processes.
The company, founded by Dallas-based marketer and cryptocurrency investor Joe Youngblood, bills itself as the world’s first marketing agency that only accepts cryptocurrency. The agency provides standard marketing services such as search engine marketing, Facebook advertising, and PR. It also offers consulting on implementing blockchain tech around solving business problems, accepting cryptocurrencies, and aiding startups in gaining funding via ICO (initial coin offering) marketing.
A differentiator is Blockchain 37 allows its clients to make payment in the cryptocurrency of their choice, with some restrictions, and doesn’t bill in fiat currency or accept checks or money orders.
Blockchain 37 also is testing a blockchain-based transparency initiative to record third-party work from freelancers and subcontractors for its clients.
The company was founded to “disrupt the self-storage industry through technology and ease of use,” said Kyle Bainter, co-founder and CEO of Callbox Storage. Its service includes picking up the items to be stored, creating a photo and barcoded inventory that can be accessed via a web page, and returning stored items on demand all at a cost comparable to traditional storage.
Callbox uses blockchain in its proprietary process involving unique identifier technology and its smart storage software to track every one of its customers’ items from their home to Callbox’s storage facility and then back to the customers’ homes. The system provides both Callbox and its customers with full transparency into the location and safety of the stored items. The system also helps Callbox in billing by automatically charging customers based on actual storage space used allowing the company to right-size customers into a proper size storage plan.
“We have implemented this technology to enable us to improve the customer experience. The traditional self-storage process is a miserable one for consumers, and, it takes a lot of time,” Bainter said. “Through our technology we save our customers time, energy, and provide transparency to their items in storage.”
Coinsource was founded in 2015 and according to the company currently operates the largest network of bitcoin ATMs in the world serving an underbanked marketplace. Given the nature of its business model, blockchain via bitcoin permeates Coinsource’s entire business model with the core of its business utilizing blockchain to bring cost and time efficiencies to its customers’ financial transactions.
“The blockchain facilitates all of Coinsource’s transactions with customers. Without the blockchain’s security, immutability, and decentralization our customers would not be able to interact with the global bitcoin economy or with their loved ones and friends that are not within close enough proximity to use cash, in the way they now can,” said Coinsource co-founder and CEO Sheffield Clark.
Looking toward the future of blockchain, Clark foresees a multi-trillion-dollar economy within five years led by digitally-native financial institutions, micropayments, machine-to-machine payments, and supply chain management technologies.
The company grew from a solution to a problem founder Justin Hunter faced as a writer.
“When identity is that base level data, that identity becomes owned by the person and not by a central authority and puts power back in the hands of the user.”
He wasn’t comfortable with Google having access to his documents through its G-Suite products. After creating Graphite, Hunter realized it could be valuable to other people by serving as a decentralized and encrypted alternative to G-Suite. Graphite is now targeted to two audiences – consumers who use Microsoft Word or Google Docs through a free product, and an enterprise market with a paid suite of tools offering security that can’t be found in other office software.
Hunter built Graphite using Blockstack, an app that allows developers to create their own apps on top of any blockchain. Graphite is currently utilizing the bitcoin blockchain.
“Blockchain technology is integral to Graphite as it serves as the method for providing a self-sovereign identity to anyone who uses Graphite,” Hunter said. “Graphite does not control any user’s identity, nor can Graphite prevent a user from using that identity to access other applications. Identity is the first step to data ownership and thus a necessary part of providing a truly decentralized system.”
Blockchain tech was attractive to Hunter for Graphite because its ledger allows many pieces of data to be verified with a central authority’s management, particularly identity.
“When identity is that base level data, that identity becomes owned by the person and not by a central authority and puts power back in the hands of the user,” he said. “Combine that with decentralized storage and the solution is incredibly powerful.”
Learning Machine was founded from inside SlideRoom, an enterprise SaaS company sold to Liaison International last summer to allow Learning Machine president and Chief Operating Officer Dan Hughes and Vice President of Business Development Natalie Smolenski to focus entirely on blockchain. Along with the MIT Media Lab, Learning Machine built the world’s only blockchain certificates open standard, Blockcerts.
“We believe that blockchains are a new kind of social infrastructure and are most useful when everyone can interact with them using shared standards.”
Using Blockcerts, Learning Machine allows organizations to issue verifiable documents and provides individuals with secure digital identities that they own. The system allows institutions to anchor official records to any blockchain they choose including multiple blockchains.
“We believe that blockchains are a new kind of social infrastructure and are most useful when everyone can interact with them using shared standards. That is why Learning Machine worked with the MIT Media Lab to develop the open Blockcerts standard,” Smolenski said.
She added, “Any business that needs to verify claims, resolve disputes between parties with differing accounts of what happened, settle transactions, or document change will end up using blockchain technology. By 2020, it will be mainstream. By 2025, [it will be] as ubiquitous as the internet is today.”
Richardson-based Swirlds is actually a blockchain-adjacent business. It uses hashgraph, a relatively new distributed ledger technology created by Swirlds Chief Technology Officer Leemon Baird that solves performance and security issues around other similar technologies.
Blockchain is another DLT solution. In technical terms, hashgraph is a directed acyclic graph and Swirlds licenses hashgraph to its enterprise clients.
Blockchain and hashgraph are impacting businesses through disrupting sectors where middlemen have traditionally been required to establish trust between parties, such as financial services, said Alex Godwin, lead hashgraph project consultant for Swirlds.
“Swirlds has the goal of fixing the internet for future generations, as the internet was designed in a way that is not secure,” Godwin said. “Hashgraph adds that trust layer on top of the existing infrastructure, without relying on trusting a single entity. Leemon’s vision is to create what are called ‘shared worlds,’ secure environments in cyberspace where you can set the rules, create content, and collaborate with each other.”
Although Transplace isn’t currently deploying blockchain in its business, as a leading provider of transportation management services and logistics technology the company recently joined the Blockchain in Transport Alliance with its Chief Technology Officer, Mike Dieter, joining the group’s Standards Council Board of Directors.
Dieter said Transplace is excited about the potential for blockchain tech at the company as well as across the entire logistics industry, and the affiliation with BiTA is part of the company taking an active role in setting a standard for blockchain use in the transportation industry.
He said Transplace believes blockchain tech has four main benefits for its shipper customers: security around communications and a comprehensive record that can’t be manipulated; tracking visibility throughout the entire supply chain from point of manufacture to end-user, such as picking an orange off a tree to a consumer’s refrigerator; quality assurance in the form of transparency around the information on shipped goods such as receipts and photos; and greater visibility into shipment capacity allowing companies to take advantage of available freight faster.
“BiTA was founded in August 2017 and has grown quickly, which demonstrates the level of interest from the entire industry. This industry-wide interest is driven by the impact blockchain can have on the entire supply chain by providing increased visibility, more complete and accurate data and record keeping, and enhanced security,” Dieter said.