What Can We Do to Spur Mass Blockchain Adoption in 2020?

This week I asked a few blockchain founders a different question (the previous interviews can be found here). All of the founders I talked with are from different niches, including infrastructure projects, crypto trading tools, blockchain-based social apps, and more. If you’re someone who monitors the blockchain field, then you’ll definitely want to bookmark this article so that you can see which answers became a reality at the end of the year.

Before we get started, we need to agree on what the term “mass adoption” means. Does it require a 100% utilization of the technology, with every single person in the world using it? Or is 10% of the population enough if they represent a specific field? Should we consider only B2B users important in this calculation, or are B2C-focused users important to consider as well too?

One way to think about this is in reference to email; most modern Internet users use email daily. No one would argue that email has been adopted by the masses. There were 3.9 billion email users around the world as of 2019, and data suggests 2020 will bring us to 4 billion (more on that here). Considering that Statista claims there are only 4.54 billion Internet users, that means:

• Only 59% of the global population uses the Internet
• Email is used by 88% of all Internet users

Therefore, email usage could be considered one of the best examples of mass adoption. On the other end of the spectrum, however, is PayPal. You’d be hard-pressed to find someone who claims PayPal isn’t mass adopted, but in Q4 of 2019 PayPal only had 305 million active registered user accounts:

6.7% of all Internet users have registered PayPal accounts

By that logic, if blockchain penetration can reach adoption levels anywhere between 6.7% - 88% on any market, we can claim it has achieved “mass adoption”.

Below is a brief list of all the startup founders as well as a quick description of their respective industries. Use this as a resource to ctrl+c and ctrl+f the name or industry to search for a quote within the article.

Infrastructure:

• Johann Polecsak, Co-Founder and CTO of QANplatform - The quantum-resistant, enterprise-ready, energy-efficient blockchain platform.
• Oleg Belousov, Founder of  n.exchange - Allows for the easy trading of fiat to crypto and crypto to crypto  transparently and securely, with little to no counterparty risk and an agreed-upon price.
• Priya Vrat Misra, Founder of Reckoon - Developer of a blockchain an AI-enabled shopping platform for the retail industry.
• Alvin Reyes, Co-Founder and Chief Technology Officer of ProximaX - A decentralized technology stack (blockchain, storage, streaming and smart contracts) for building the next generation of data privacy-centric applications.
• Andrey Bugaevski, Head of BD Incognito.org - A platform for privacy tokens
• Brian Gallagher, CEO Instars.com - The world's first blockchain-powered data exchange fueling the mass adoption of cryptocurrencies.

Social and games:

• Tony Tran, Founder of Alfa Enzo  — A marketplace that lets anyone buy and sell attention.
• Alexander Palmer, Lead Editor of CasinosRealMoney.com – A casino review site made by real players.
• Julien Moorrees, Owner of Same Room Games - Having fun with your friends.
• David Mah, Founder of Wagerr - Unrestricted sports betting with the world’s best odds.
• Ivan, Co-Founder of cryptotask.org - The biggest decentralized freelance marketplace.
• Nate Wheeler, Chief Editor of Realmoneygambling.com – A site dedicated to educating players about online gaming sites.

Fintech:

• Nemr Hallak, from volentix.io  - Cross-chain decentralized exchange
• David Gobaud, CEO of Passfolio - An app that provides commission-free US stock and crypto trading to users from around the world.
• Brandon Elliott, CEO of Javvy.com - Pioneering the future of finance by consolidating and simplifying the entire concept of money.

Business & Educational Services:

• Ivan Bjelajac, CEO of MVP Workshop - A blockchain research and development studio.
• Momchil Jambazov, Design Lead of OS.University - A digital credentials wallet for the discovery and verification of achievements.
• Tzahi Kanza, Founder of FutureBlock - Venture studio.

It has been almost five years since the public launch of Ethereum and Hyperledger Fabric, the two most popular technologies on which decentralized solutions are built.

The top three industries that most actively integrated the blockchain into their processes are: the financial sector, supply chain management, and the Internet of Things (IoT).

Five years should have been plenty of time to see the first results and supporting statistics on how projects have progressed. Let’s crunch the numbers to see what’s in store for 2020.

Applications of the blockchain in the Financial Sector

The global stock market size grew by $17 trillion in 2019. It’s hard to make an exact estimation of the crypto trading market size (due to fake volumes). But even if we use the current Coinmarketcap statistics, crypto only accounts for roughly $276 billion of that value — meaning that the crypto market is about 62 times smaller, or roughly 1.6% the size of the global stock market. Based on our agreed-upon terminology above, blockchain (and crypto-trading) is not achieving mass adoption yet.

For the current crypto market to achieve mass adoption, it would need to grow 4.2 times its current size, or to roughly $1 trillion in size. We were close to this in 2018, but I’m betting we won’t achieve this in 2020.

The payment market is another avenue for this growth. For simplicity’s sake, let’s take the amount of PayPal payments as a starting point. In Q4 of 2019, PayPal processed approximately $3.46 billion in payments.

Assuming that the crypto’s darknet is the most active area when it comes to cryptocurrency payments, how does it compare to PayPal’s volume? In 2019, roughly $800 million in crypto payments were made, which averages to $200 million per quarter — roughly 5.7% of PayPal’s volume. Here, crypto would need to grow by about 17.5 times in order to match PayPal in terms of payments.

My bet? This won’t happen in 2020.

Applications of blockchain in supply chain management

The global supply chain management software market was valued at $14 billion in 2018, with a predicted value of $30 billion by 2024. In the same year, 2018, the global blockchain supply chain market was valued at $85.7 million. Predictions for the blockchain market put the value at $2.7 billion by 2024, which will place it at approximately 9% of the total market size.

This niche is closest in terms of mass blockchain adoption, which is why I’m placing my bet here.

Applications of Blockchain in the Internet of Things

The global IoT market was valued at $212 billion in 2019. The blockchain IoT market was valued at $113 million for that same year, accounting for approximately 0.05% of the total IoT market. We’d need to see a 100x increase in 2020 to even hit the lowest barrier of our mass adoption definition.

You guessed it... I’m betting this won’t happen in 2020.

These are just the top three most popular niches where blockchain technology is being applied. The major concern here is that we need anywhere from 17 - 100x growth in 2020 to even achieve 6% mass adoption. Is this even possible? Growth like this is certainly achievable in the modern digital age, but only time will tell whether it happens or not.

Here’s an interesting discussion about a similar question from two years ago posted on Quora.

You can read the full predictions below:

I. Nemr Hallak, from volentix.io - We will make using Verto - our multi-currency wallet manager- as easy to use as possible, with a special focus on key recovery via biometric ID and services that users are excited about, like staking, lending, and earning opportunities like referral programs and node subsidies. All of these will be as easy as any social app.

For the masses to join, we must focus on making it very easy to buy crypto, with a special focus on those who don’t have any coins yet, (no coiners). Volentix will combine all of these services in one easy-to-use platform accessible from the multi-currency wallet manager Verto, including market ratings by the Volentix ratings engine Vespucci, rewards by Venue, and a seamless decentralized exchange through vDex, as well as true community governance and development with VTX subsidies.

People want to know how they can make gains in crypto.  Making it easy and simple will be our main focus this year. 

Mass adoption is going to take a while, but we will be there with a full suite of easy-to-use services from your favorite device. We have so many solutions for so many serious problems in crypto that it is not practical to talk about all of them. Mass adoption is inevitably coming, because there are so many exciting things happening and so much innovation that the adoption will actually happen without anyone even realizing it until it’s already there. 

Volentix is only one of many pioneers in this field, and just like how everyone has email and PayPal today, a Verto ID will soon be just as normal. 

II. Oleg Belousov Founder of  n.exchange - In my opinion, what is stopping Bitcoin and crypto adoption is the lack of easy on and off ramps, as well as the lack of traditional instruments to hedge against down-side risk that are available for other, older investment vehicles.

While we deal with the former challenge here at n.exchange, the latter might receive a partial solution when CME (Chicago Mercantile Exchange) will roll out it's futures options later this year.

III. Tzahi Kanza, Founder of FutureBlock - The challenge of the mass adoption of blockchain should be divided into different aspects: adoption of the technology, adoption of crypto for payments, adoption as a standard, etc. My main focus is on blockchain technology, and in this respect, mass adoption is inevitable, although it is a slow process that requires the acceptance of agreed-upon standards, local and global regulation, and of course, implementing the technology. In this aspect, our task is to assist both companies and regulators in better understanding the advantages of blockchain technology and the requirements for applying it.

IV. Ivan Bjelajac, CEO of MVP Workshop - Blockchain might be an amazing way to connect the dots between all of the emerging technologies, but the biggest benefits that are out there are still limited by both the state of the technology and our ability to fully use the business models that Web 3.0 is providing.

As long as the tokenization of everything is the main driving force for blockchain innovation, we will see only long-term projects primarily driven by the marketing and hype campaigns around it, as there are very few people who actually need the solution for the problems they are solving.

If we are to see the real adoption of blockchain in our everyday lives, the blockchain community needs to spend less time on building their island-like protocols and think hard about ways to connect them.

V. Momchil Jambazov, Design Lead of OS.University - Any transactional business can benefit from blockchain technology, no matter what the transacted asset is: money, documents, signatures, or even education credentials - it is all a matter of sharing trust. To achieve the mass adoption of blockchain, we believe that blockchain companies should work towards the usability of their solutions in 2020. The same way web-based products are built without users using them being fully aware of the HTTP protocol, users of blockchain-enabled products should not feel the blockchain drag force when using blockchain-enabled apps.

VI. Tony Tran, Founder of Alfa Enzo - The only way for real mass adoption to happen is for real projects to emerge—projects that deliver on business fundamentals. We need an entirely new class of business, built natively for blockchain technologies. Thus far, we have only seen a new design plus blockchain—and most of these guys aren't even blockchain, it's just a token with some outlandish rage behind it. 

Building a real decentralized business at scale is extremely hard. Simply taking a successful business and applying blockchain technology to it will never end in a defensible business. It’s the equivalent of smearing snake oil on a laceration and expecting it to work like stitches. Blockchain has zero competitive advantage when it’s applied to an existing case. It is only effective if it is applied in an equally novel and unprecedented way. 

Anything that will be adopted at scale addresses all these: What, Where, Why, and How. What is the problem? Where does it exist? Why is a solution needed? How will it be solved? Then once you have all these answers, you have to ask whether the solution is truly faster, easier, better. So far, I’ve only seen projects working on just one or two of these elements. During the hype period from 2015-2017, projects skipped this process entirely and only talked about the “How” because it allowed them to hide behind complications, lore, and hype. 

In the real world, it isn’t enough for a thing to be useful or good; the thing has to fulfill some other unconscious need. Successful digital businesses build structures that reward our pleasure centers. They compel you to click and stay. So start looking for these novel implementations. Start from first-principles, and build a real business. That’s what we need to get to mass adoption.

VII. Brian Gallagher, CEO of Instars.com - Blockchain projects must get serious about improving the onboarding process for their users. Creating a wallet or joining a community needs to be as easy and understandable as creating a Facebook account.

VIII. Brandon Elliott, CEO of Javvy.com - Mass adoption of the blockchain will come about after the highly touted blockchain benefits are proven. These benefits include the transparency of transactions, significantly cutting logistics costs, and facilitating a decentralized financial system. Many projects are working to solve the numerous barriers, and we will succeed eventually. Once proven, and in hindsight, blockchain technologies will "just make sense" and seem like the way it should have always been done.

IX. Ivan, Co-Founder of cryptotask.org - I think the trigger we will see for 2020 adoption is in one word - TRACTION. Crypto has passed all hype cycles and now it is time for the real implementation to take place. People need to start using the actual blockchain-powered products to see their benefit. I think it will happen in community platforms first because people will clearly see the huge benefit of paying less fees than for traditional services, like with our platform CryptoTask, which made online freelancing a lot easier and cheaper than it ever was.

X. Nate Wheeler, Chief Editor of Realmoneygambling.com - Provably fair, that is the largest asset blockchain holds today and can offer back to iGaming. The automated nature and public visibility of each transaction in the public ledger guarantee that every transaction completed on the blockchain is verifiable, which gives the technology a strong footing in iGaming.

We predict that blockchain will be adopted widely in gaming and this will happen as early as 2020 with regulators already issuing the necessary legal framework. The Malta Gaming Authority (MGA), for example, has been working on a license to enable DLT and crypto projects to exist in compliance with regulation today. This is just the beginning.

XI. Alvin Reyes Co-Founder and Chief Technology Officer of ProximaX - Blockchain technology is a disruptive technology that revolutionizes how data is distributed, managed, and secured. Data as the central key point of this technology means that we can virtually apply these new schematics to any data-centric application.

There is no question that it can be utilized on Enterprise or government organizations to make their business more efficient, and its data more private (through the use of encryption technology). Still, I do think that the main driver of user adoption is actually to educate everyone about the potential of this technology and, at the same time, build impactful use cases that back up the ideology behind it.

People in the technology space should start looking at it, study it, and see how useful it can be for data distribution and protection. Technology educators should continue to open the minds of people to let them know the potential of this technology and how it can complement their solution design. Advocates need to keep with spreading the word of technology and its most successful use case - cryptocurrencies. 

Along with educating them must be with applicable use cases. One such use case is the digital self-sovereign identity, a revolutionary identity management framework that puts the identifiable data protection at the center. The majority of us are reliant on digital services that usually require our identification, and the more we expose our individuality, the more vulnerable we become to hacks or exposure. Self-sovereign identity protects identifiable data and using blockchain and its cryptographic technology creates a framework and toolset that can protect the individual's identifiable data. 

A digital notarization and verification system is also a useful application. Digitalization has made it easy to build fraudulent documentation, and a blockchain-based notary system can create a bullet-proof fraudulent prevention system based on the same cryptographic technology that makes the blockchain data immutable. 

Share Depository and Real Estate asset tokenization is also a great use case. A REIT (Real Estate Investment Trust) company can use blockchain technology to represent real estate assets, manage income-producing real estate, and facilitate distribution to investors in a secure environment through the use of smart contracts. 

An open crowdfunding solution is a great use case too. One can create a free investment platform for investors to gain access to income-producing investments easily without the use of a broker or middleman.

An interesting complimentary use of blockchain technology is the development of an autonomous network of services that use it as a core ledger for recording. 

At ProximaX, not only do we offer our blockchain, but we also use it to provide a decentralized file management system (storage) and distributed streaming. Sirius Storage uses the ledger to build a decentralized identification system of storage operators, which in turn used for reputation (proof of storage) and incentivization. Similarly, Sirius Streaming also uses the ledger for this purpose. It's running on its ecosystem, which provides its reputation score (proof of bandwidth) and capacity. The best stream nodes get the highest chances of delivering a service, which then results in incentives as well.

If you look at it, the ledger itself made it possible to build an autonomous network of different horizontal services. In our case, it's storage and streaming, but it can also be a search engine service, a content management service, or even a messaging service. 

Yes, these are all too advanced, and we have yet to explore the power of blockchain with these services. It's hard to ignore the possible innovations that can be done. As we move toward innovating the use of Web 3.0, the need to have a decentralized technology stack to build mission-critical/privacy-centric applications is essential. 

XII. Priya Vrat Misra, Founder of Reckoon - Blockchain is a great technology, however, there are a few things holding it back from becoming as ubiquitous as it should be.

It’s ironic that large-scale adoption of a technology only starts happening when it becomes invisible; in other words, for blockchain it is when the core question “Why are you using blockchain to do this?” goes away. Like in the case of cloud computing, you will not hear anyone, anymore, asking a startup this question “Why are you hosting your server in the cloud?” The use cases and advantages are clear and well known. 

For blockchain to be adopted in volumes, it needs to have some real-world use cases so that the industry can understand and relate to them. Why? Because they have felt the pain and can see the value.

Reckoon is one such example of a real-world problem solved by blockchain for the retail industry. We need many many more industry-specific blockchain startups to make mass adoption happen for the blockchain in 2020 and beyond. 

XIII. Julien Moorrees, Owner of Same Room Games - When we developed our social location-based blockchain game, it failed as the average consumer doesn't want to pay per use (with the ethereum network). Thus, for mass adoption it should not cost any money to participate. So for 2020 we changed our model for our new business, Same Room Games, that is free for users and inexpensive to implement: Google Play, App Store, website.

XIV. Andrey Bugaevski, Head of BD Incognito.org - I don’t really think mass blockchain adoption will occur in 2020 – we’re still a few years away from that. But what we do now will shape what we have in the future. There’s not enough space here to talk about how to encourage integration of the technology itself, but as for the blockchain’s most widespread use-case today – we need to make owning cryptocurrency less scary, and we need to protect those who already own crypto. Friendlier user interfaces and experiences are integral in tackling both. There’s no ‘Forgot your password?’ safety net when it comes to crypto, and whether or not you think there should be, users need better options to make the choice for themselves. We need to design easier ways for users to adopt the best crypto practices and really understand, embrace, and get comfortable with what we hope is our decentralized future.

Privacy is another big one. We’re currently waking up to the reality of 24/7 surveillance, and having our net worths and financial histories displayed on public ledgers will simply speed things along. Cases of both online and offline attacks on high-net-worth crypto holders are on the rise. Less menacing but also worth considering are traditional investor mindsets – the current lack of privacy inherent to crypto networks and services today does play a considerable part in discouraging adoption beyond the crypto niche. We see all the time how traditional investors hesitate to expose how much they trade, or how often they invest or borrow. We’ll need stronger, more widespread privacy options for this new economy.

XV. Alexander Palmer, Lead Editor of CasinosRealMoney.com  - Blockchain is bound to be the next big thing in iGaming. For years now, we have had gaming websites that have successfully incorporated the concept of crypto and blockchain gaming into the mainstream. There are at least a dozen brands that are some of the most trustworthy establishments today, and we strongly believe that this model guarantees the safety of both players and business.

Admittedly, there are new challenges insofar as security is concerned, and that makes some reluctant. But the solutions to boost the reach of blockchain within the iGaming industry already exist today, and they are shaping up the future in 2020 and beyond.

XVI. David Mah, Founder of Wagerr - If we want mass adoption to occur in 2020 we need to start building products that people actually want. Most projects I see out there today have no users because they have no utility; they are mostly built around speculation of an investment return, which is ironic because they need users and utility for that investment return to come to fruition.

Making the user onboarding experience into the crypto world seamless is also a part of it, but that is mostly secondary. You could have the best user experience in the world, but unless you are actually building something users want, something that solves a real problem for them, then we can’t expect mass adoption.

The other obvious thing is understanding why you need blockchain in the first place. How does this technology improve the business model of the industry you are trying to solve for? Wagerr, for example, is a blockchain built for sports betting. 

By using the blockchain as a sportsbook, we are able to offer our users distinct features that no other bookie in the world can. Things like giving the users complete control over their funds at all times and allowing users to bet without limits, whilst also offering the sharpest odds on the market. For professional bettors, it is a constant battle between traditional bookies and themselves, as their accounts are often closed or restricted to such small amounts that it is barely worth their time to bet.

At Wagerr, we welcome winners because the blockchain offers complete anonymity and therefore cannot restrict individuals. The reason we can do all of this is because blockchain technology allows us to create a completely new business model, a business model that is far superior to legacy sportsbooks.

Mass adoption will come, but first it's about having a clear business model in which your service/product solves a real problem, Wagerr is confident that we have that part solved. 2020 for Wagerr is about improving the user and onboarding experience to the point where users feel confident to try our products. If we can get users to try Wagerr, we are confident they will stay.

XVII. David Gobaud, CEO of Passfolio - The key to mass cryptocurrency adoption is making it ten times easier, cheaper, and faster than fiat alternatives, such as credit cards. Users require super simple and secure wallet apps, and merchants need cryptocurrency-enabled point of sale systems.

XVIII. Johann Polecsak, Co-Founder and CTO of QANplatform - To my mind, there are three main obstacles that hinder blockchain technology’s mass adoption.

Usage model

People of the connected age are used to uploading their content to platforms that are free to use; e.g. Facebook or Instagram. However, writing on any blockchain costs money. 

This makes perfect sense since storing data on servers always costs someone money; only platforms like Facebook take over these costs from their users with subsequent profit gain in mind. On blockchains, users have to pay the fees themselves even if a provider would be willing to do it, like Facebook. They wouldn’t be able to do so because no such smart contract can be programmed today that comes up for transaction fees instead of the user.

We think that this is the wrong model; we are simply not wired like this. We cannot force the users to pay. We need a system in which the smart contract creator can take over system fees from the users. The QAN platform will offer this possibility.

Private key management

Three main options exist today:

We can trust in an exchange or a custodial key manager. We can give transfer orders, but they have your key and they sign the order. 

It’s exactly the same as with banks; you trust someone else with your money.

Hardware wallets

These are not open-source hardware manufactured for key management purposes specifically. As they are not open-source, they are only considered to be secure because the operating method is not public (black-box testing). While this might sound like a theoretical problem, do a quick Google search about major hardware wallet manufacturers’ device breaches and you’ll be surprised. Again, you hand over key management to a device that you know nothing about.

Keys are exclusively possessed by the user. The user has all the control, who is unfortunately also known for being the weakest link in the chain. They are just bad at managing their private data. 

Our solution to this problem is the creation of an open-source, truly minimalistic operating system) that can be booted from a USB stick, aimed solely at managing keys and making transactions. No new device needed, transparency is guaranteed, and the system is foolproof, which means that it cannot leak private keys accidentally.

Noise

There is an endless number of projects announcing their ICOs, STOs, and IEOs, many of which have no genuine background. Without serious research, people cannot differentiate between real projects and scams. There are very few experts in the market and they rarely have the time or capacity to validate projects. 

In this noisy market, it is hard to draw the necessary attention to projects that provide real value. 

There is a need for an expert analysis of blockchain projects that is public and available to a wide audience to eliminate the noise so that valuable projects that help blockchain mass adoption get the needed attention.

The author is not associated with any of the projects mentioned.

(Featured Image: source.)