Blockchain payments need better standards

Following bitcoin’s historic rise in 2017, cryptocurrencies and blockchain technology continue to make waves in the worlds of traditional finance and emerging technologies. However, despite blockchain’s unprecedented growth, the lack of real-time transaction settlement, scalability issues and standardization concerns are threatening to block the technology from piercing into the mainstream.

Addressing some of these roadblocks, Deloitte recently published a report highlighting five "vectors of progress" that might help the industry overcome its current limitations: increasing throughput and performance; raising standards and interoperability; reducing the costs and complexities involved with building and deploying blockchain-based solutions; providing increased regulatory support; and multiplying dedicated consortiums.

As it relates to throughput and performance, globalization and digitalization require enterprises to be able to handle more transactions than ever. Customers, both online and offline, demand fast transaction processing. To remain competitive, enterprises must constantly adapt and evolve their business strategy to meet these standards.

Olivier Le Moal/Olivier Le Moal - stock.adobe.com

Enterprises also do not have the luxury of changing the bottom layer of their ecosystem frequently, as many lack the capability to properly learn these technical changes. A standard for protocol layers and interoperability between protocols are needed to lower the threshold for businesses looking to adopt the technology.

As with every new technology in its early stages, blockchain adoption may suffer from suboptimal integration and high training costs. Currently, most new projects seem to be building blockchain solutions without fully considering whether or not people will actually be able to use it. Reducing costs and complexities will be part of the uphill battle for businesses as they look to implement decentralized technologies, but the very first step companies and projects should take to avoid unnecessary expenses is demonstrating that their product is user-friendly.

Another roadblock in blockchain’s adoption is the lack of regulatory support, and the uncertainty that surrounds the entire industry is a huge barrier to enterprise adoption. Organizations are not willing to explore or implement a technology without knowing at the very least what the potential regulations are going to be.

Lastly, having the right associations and industry partners is critical to businesses as they look to adopt blockchain and garner attention from potential users.