Anyone in the cryptosphere has probably heard someone claim that blockchain is going to bigger than the internet. While it might be true, the hype behind blockchain technology may actually be off-putting to enterprises considering investing in the technology, according to Fortune magazine, citing a November 7 report from Forrester Research.
Blockchain technology was popularized after the anonymous enigma named Satoshi Nakamoto released the Bitcoin white paper in 2008. Originally, most people thought that blockchain technology could facilitate financial transactions but not much else (some still do).
When Vitalik Buterin became frustrated with the limitations of Bitcoin, he decided to build the Ethereum blockchain, which utilizes executable distributed code contracts (aka smart contracts) to process other sorts of transactions. Since the network went live in 2015, people and businesses – including Microsoft, IBM, and Google – have paid increasing attention to the potential of blockchain technology, researching ever more use cases for it.
But the buzz around blockchain also attracted companies without tech expertise. Perhaps the best example of a company using the hype around blockchain technology to its advantage is Long Island Iced Tea Corp. In 2017, the beverage maker officially changed its name to Long Blockchain Corp., which caused stock in the tiny company to increase more than 200 percent in just a few months. (Things didn't turn out so well in the end for the company.)
Times have changed. According to Fortune (sorry, we don't have access to the report itself), the Forrester report states that many companies feel that blockchain technology has become so over-hyped that companies are actually dropping the term blockchain in favor of a lesser-known term, distributed ledger technology (DLT), which they feel is more descriptive and less buzz-wordy.
Fortune quotes the report as stating, "The networks that are live or under development vary greatly and frequently lack key characteristics that many regard as essential components of a blockchain." It further states that the term blockchain can also carry negative "wild west connotations" of cryptocurrency.
Although the report cautions investors to beware of this kind of "blockchain washing," it is hopeful that the technology is improving and advancing.
According to Fortune, the report states: "On the tools and services side, we'll witness steady but cautious progress. 'Cautious' because DLT hasn't proven to be a significant, reliable revenue stream for software and service providers, and 2019 won't be any different."
Considering the term "blockchain" is a more popular search term by a factor of 26:1, those encouraging a switch in nomenclature have a long road ahead of them.