Blockchain-based businesses face several challenges that may sometimes lead them to fail, mainly due to lack of incentives.
In addition, blockchain projects have been in the doldrums, as this technology was expected to add value to projects and businesses exceeding $3 trillion by 2030. However, the blockchain industry seems to have stalled slightly, which means that interest in the technology wanes, due to lack of incentives.
Blockchain is not the first technology trying to move from inflated expectations to reliable commercial viability. However, if the blockchain finds any opportunity to achieve its initial promise, the approach adopted by teams in designing and launching the products should be changed.
What’s wrong so far?
Firstly, the companies put the technical design before the economic design, giving priority to hiring technical teams and developing code. Meanwhile, they postpone important discussions about the product value and user incentives.
By the time, teams handle the design of incentives. However, they put themselves before a narrow range of economic design options that are compatible with the existing code. In addition, they may face deleting and rewriting large portions of the platform.
Blockchain platforms are economic systems. Blockchain-based consortia allow companies to share, buy and sell valuable data and use that data collected to offer new goods and services which generate higher returns. Thereafter, the design of these platforms is economically no less important than their technical design, and this must be reflected in the development process.
The second important thing is choosing the team and founding members of the blockchain platforms, and then choosing the target customers. Companies want to achieve higher returns on their investments, but sometimes this belief limits the broader economic concept of blockchain networks, especially in the future.
Like social networks, the blockchain derives its value from the network effects, visitors and participants.
Well-developed monetization strategy needed
A well-developed monetization strategy should be taken into consideration. Thus, charging early users too much, or implementing excessively high upfront costs would slow the network expansion. In addition, it would discourage the network from ever entering the market.
Accordingly, offering discount rates to early adopters, or even subsidies for high costs of adoption, would enable the network to reach the great goal of monetization.
Blockchain has invaded all sectors, including recruitment. Netherlands-based Randstad, the largest human resources company in the world, has started testing a blend of Cypherium platform and Google Cloud to match expertise with business needs.
Cryptolydian reported today that Randstad conducted a study, indicating that the distributed ledger technology (DLT) offered a way to safeguard consumers’ personal data. In addition, it allows the verification of academic qualifications, as well as birth dates, addresses and IDs.