Blockchain applications promise to smooth out the many friction points in today’s business transactions. Relying on algorithms to provide the functions of trusted third parties, blockchain applications will enable trading partners to transact directly with each other. By copying a single, immutable record of transactions onto each node in a network, trading partners will share one version of the truth, eliminating the need for validation and reconciliation. Ultimately, blockchain applications should lead to faster, lower-cost, more secure transactions within and across organizations.
Blockchain technology is often compared to the internet in terms of its power to transform business and society. In recognizing the potential benefits of blockchains, companies have invested billions of dollars in blockchain research and experiments,1 generating thousands of proofs of concept across industries. In addition, companies, regulators, re- searchers, and nonprofit organizations have created numerous groups and task forces to define standards and develop code. Yet MIT CISR research has found that there are currently very few enterprise blockchain applications in production.2