Cryptocurrency and blockchain technology have started to reach a mainstream audience in the latter half of 2017. Especially amongst young adults, there is considerable excitement and buzz around the latest blockchain technology and how it will impact the world. Cryptocurrency companies have been focused on targeting consumers who are buying currencies to be used for services and goods in the future.
For blockchain technology to thrive in 2018 and beyond, the industry must implement the right strategies that encourages real adoption and usage. Adoption has to be a 2-sided coin and the focus must shift beyond convincing enthusiasts to invest in different cryptocurrencies. Suppliers creating goods or services must begin to integrate with blockchain systems into their business for true adoption to happen. Otherwise, cryptocurrencies remain as speculative markets if there is not underlying value generated by those creating goods.
The other side of adoption
The challenge for this year is to convince suppliers, manufacturers, and creators to accept cryptocurrencies and utilized the blockchain in a way that provides value to their production. This is a tough ask for many existing companies because it generally requires more investment or labor capital to systematically change their existing processes.
Here are some problems we currently see today for why companies might not adopt blockchain. These are not specific to the gaming-industry, but are concerns for game developers as well.
Often times, those who are able to benefit the most from decentralized systems are smaller companies who have less control and leverage in centralized systems. Even though the benefits may be substantial, adding a team dedicated to implementing blockchain systems would be too expensive to make this worthwhile. This is especially true at this current stage of rapid blockchain advancement because the investment in implementing a blockchain system may be wasted due to outdated technology.
Additionally, new blockchain systems must be incorporate properly to the existing business. There is cost even with a simple cryptocurrency payment systems to ensuring that it functions their their inventory system or CRM system. For video games or other social platforms, it requires development to ensure that blockchain users and regular users can continue to interact together as expected.
Although Bitcoin has been around 9 years, blockchain development resources are very scarce. Dedicated blockchain engineers are difficult to find and software engineers wanting to do blockchain development lack access to learning materials and tools. As such, many companies do not have access to the expertise needed to utilize blockchain technology.
Companies who receive cryptocurrency would want to convert to their local fiat currency as soon as possible to mitigate risks due to price volatility. A late conversion of currency could easily turn a profitable transaction into loss. For many cryptocurrencies, there is not enough market liquidity to avoid impacting the price when larger companies need to liquidate into dollars. Even for more popular currencies, it may still be a multi-step process that takes days to get into their central bank accounts.
Although the distributed ledger is secure and immutable, a lot of the surrounding technology and services may not offer the features and security needed to do large scale business. Smart contracts, wallets, exchanges, and payment vendors may all have vulnerabilities and the product itself has not been tested over a significant period of time. These components represent additional risks for existing business to shift towards making blockchain a larger portion of their business.
Exclusivity / Existing obligations
Most existing companies have signed long-term deals with vendors in which blockchain solutions directly compete with. These existing obligations may include exclusivity clauses that prevent the usage of a competitor or it may not allow for integration with competing software. This may become increasingly common as centralized business services feel threatened by blockchain competition.
Lowering the barriers
It is in the best interest for current blockchain businesses to lower the barrier to entry for potential business clients. Caution should be taken if a company is not actively working with their partners and educating them, as it is a sign that they are not concerned about their long-term growth.
For KorroBox, our product vision and roadmap directly tries to lower activation for game developers. Our development team works closely with our partners and provides turn-key solutions that integrates with their production process and do not fragment their users. We also chose to use tested Ethereum protocols and products due to better documentation and security. Additionally, Ethereum is one of the few currencies that offer the liquidity needed to conduct business today, although transactions speed needs to be more robust in the future. We hope that our partners are able to grow and scale with us.