2016 has been a productive year for blockchain technology research as a whole. Increased interest in blockchain tech has kick-started a number of blockchain applications in industries worldwide. A recent market research report estimates the global blockchain tech market will grow from USD 210.2 million in 2016 to USD 2.3 billion by 2021. This is a Compound Annual Growth Rate (CAGR) of 61.5 percent. This is phenomenal growth for a five year period - especially for a technology that’s still in its infancy. However, it isn’t just the blockchain that’s turning heads.
Smart contracts are a supplement to the Ethereum technology that could potentially breed further innovation. These smart contracts automate many tasks that would otherwise require multiple intermediaries. This allows for less oversight and trust agents. The smart contract technology has made Ethereum an innovative platform that can revolutionize varying industries. Ether, the currency fueling Ethereum’s functions, currently rests as the second most valuable cryptocurrency, with a market capitalization of (at the time of this writing) $726,860,876. Yet, the question remains: What new ideas will swing Ethereum into mainstream use?
Financial Services and Prediction Markets
The financial services sector is expected to expand rapidly. Platforms like Branche plan to disrupt the financial service industry by offering Ethereum-based blockchain solutions to basic financial services like Microcredit and check cashing. Additionally, investors have the option to use ICONOMI, a decentralized platform that seeks to provide investors with financial instruments that will return high profits in a decentralized economy. Augur, a decentralized prediction market built on the Ethereum blockchain, is a prediction tool for real world events. Augur allows users to make predictions on events that are happening in real time and gain a profit if, and when, their predictions are correct. Similar to investors putting money into stocks they believe will perform well, Augur uses the wisdom of the crowd so users can make better-judged predictions for a better return.
Ethereum-based projects seek to disrupt the real estate industry by implementing smart contracts that will reduce the friction involved with payments, liens, and mortgage contracts. Smart contracts can also alleviate privacy concerns among lenders and borrowers. Rex MLS is an Ethereum-based insurance platform that allows for Peer-to-Peer (P2P) access to MLS information. The real estate platform allows for the listing and searching of properties without the hidden fees charged by other platforms.
Privacy and Identity
Smart contracts will assist in the streamlining of business processes by replacing traditional methods of trust with smart contracts. Using smart contracts, companies will automate processes like renewals, the release of records, and destructions. Trust Stamp works on Ethereum and serves as an identity verification tool. “Trust Stamp uses social media and other publicly available data to verify your identity and provide a unique FICO-like trust score.”
Chainy is an Ethereum-based authentication and verification system that uses timestamping to permanently record things on the blockchain. Uport is another such platform that functions as a self-sovereign identity and key management system. Built with users and developers in mind, it consists of Ethereum smart contracts, open-source libraries, and an easy user interface on its mobile app. The company was formed with the incentive of providing users with a secure and convenient way to own and control the facets of who they are online: Identity, reputation, data, and assets.
Blockchain technology is expected to play a major role in the growth of tech in the insurance industry. A recent report conducted by Juniper Research, a mobile online & digital market research company, estimates:
“The insurance industry will reach almost $235 billion globally by 2021, up 34% y-o-y from an estimated $175 billion this year.”
Juniper predicts that the blockchain will fast-track the insurers’ experience by utilizing smart contracts and smart policies that automate customer circumstances.
Dynamis is a P2P insurance platform that utilizes the blockchain and smart contracts for managing supplementary unemployment insurance. The platform uses the social network LinkedIn to verify employment status and identity. Inchain is a decentralized insurance platform that mitigates risks associated with total or partial losses of crypto assets due to cyber attacks and hacks.
The media and entertainment markets are expecting a shift due to the blockchain’s ability to fix vulnerabilities with copyright issues, tracking, payments, etc. Platforms such as Ujo and Peertracks are two companies aiming to decentralize the music industry. These companies utilize Ethereum and the smart contract technology to give absolute creative control over artists’ work to the artists by avoiding the overhead of music platforms like Soundcloud, ReverbNation, and Spotify. Singular DTV, an Ethereum-based content distribution and management platform, promises to allow digital artists and creators the ability to monetize and protect their creations.
The world of gaming has also taken an interest in Ethereum applications. Beyond the Void is a real-time strategy space game that utilizes Ethereum smart contracts to help users conquer planets and blast opponents across the universe. Firstblood is a decentralized eSports platform that will allow eSports players to fund and challenge each other to win rewards. Etherplay functions as an Ethereum-based arcade where gamers compete for top scores and rewards. VDice is an Ethereum-based gaming platform that just made headlines when it raised over $1 million dollars in 90 minutes. VDice enables developers to monetize from their own gambling games created for the Android Play and iOS marketplaces.
Ethereum-based social media networks like Akasha allow for users to publish, share, and vote for work that’s published on the platform. Akasha’s goal is to function as a decentralized alternative to services like Medium and WordPress. Unlike Medium and Wordpress, Akasha gives users monetary incentives to create rich content by granting curators rewards in Ether.
Ethereum enters the smart infrastructure industry by allowing for the trade, rent, or selling of energy or any other P2P products. Slock.it, an Ethereum-based company, aims to bring the blockchain together with IoT (Internet of Things) solutions to foster P2P transactions. ElectricChain is utilizing Ethereum-based technology to accelerate the growth of solar energy by partnering with organizations to incentivize solar energy collection and use. LO3 Energy was recently awarded a patent for allowing energy trading using Ethereum-based technology. In collaboration with Siemens, LO3 created a micro-grid project for Brooklyn, New York, called the TransActive Grid. It’s a peer-to-peer energy trading platform where neighbors can buy and sell energy from and to one another.
As 2016 comes to a close, many Ethereum-based projects are looking ahead into 2017, adding more details to their roadmap. Companies that were once in alpha may begin their beta phase, and those that deployed projects on the testnet may be focusing on mainnet deployment. With a productive 2016 in the way of projects, 2017 will be a promising year.