ForresterForrester has published its enterprise blockchain/Distributed Ledger Technology for 2020. In essence, its analysts argue the focus will shift to integration and interoperability, from irrational exuberance to realistic assessment.

Continued hype notwithstanding, enterprise DLT teams are focusing on realistic use cases and bringing existing projects closer to, or into, production. This means more emphasis on how frameworks perform and how well they integrate with existing systems and, potentially, each other. Permissioned vs public blockchain (competition) will heat up and reach executive teams (and, with) multiple networks already exist(ing) for some of the most popular use cases (such as supply chain or trade finance), proliferation will continue.

Interest in blockchain/DLT continues

While interest in blockchain/DLT remains high, according to Forrester’s analysts, it has evolved. Interest and activity has shifted from unfocused exploration to focused strategic projects. The effect will be that in 2020 there will be more realistic explorations – though, they say “expect some drama” on the frameworks and and tools fronts.

In Forrester’s analysts’ view, the shift from irrational exuberance to realistic assessment is almost complete. While they still see excitement around what blockchain/DLT could do, the focus now raises questions about how blockchain/DLT might deliver a particular benefit. They also comment on a shift:

  • away from R&D-type exploratory proof-of-concepts (PoCs) run in isolation
  • to a focus much more on the end-to-end process to which blockchain/DLT will apply
  • with an understanding that non-tech issues (including business and regulatory challenges) are the biggest hurdles to overcome.

Fewer companies are embarking upon blockchain/DLT projects than in 2016 to 2018, especially in North America and Western Europe. Those that do are taking a more informed and strategic approach. Accordingly the predictions for 2020 fall into five groups:

  • over 80% of blockchain/DLT deployments will be hybrid or multi-cloud — or both
  • frameworks will continue to battle for dominance
  • interoperability will take centre stage
  • improved ties between blockchain/DLT and business management solutions will come
  • the permissioned vs public network debate will deepen.

Over 80% of blockchain/DLT deployments will be hybrid or multicloud — or both

Networks with stringent data sovereignty and confidentiality requirements will clearly have chosen frameworks that support hybrid or multi-cloud models. Many enterprises will opt to run nodes on-premises, especially if:

  • there is no in-country public cloud option
  • risk management, compliance and/or integration requirements call for doing so.

As networks expand, nodes will distribute across multiple cloud providers. This will apply even if a network leverages its managed blockchain offering from a services provider. (Enterprises have made it clear to vendors that it is unacceptable only to offer BaaS (blockchain-as-a-service) in a provider’s cloud.)

Frameworks will continue to battle for dominance

Frameworks will continue to battle for dominance, with possible surprises. The most common platforms in advanced pilot projects or production deployments in 2019 were:

  • Hyperledger Fabric
  • Ethereum/Quorum
  • R3 Corda
  • Digital Asset (DA)
  • MultiChain.

Hyperledger Sawtooth is gaining traction. DA shifted its focus to DAML, its smart contract scripting language, which led to several integrations with other blockchain frameworks.

In the Forrester view, during 2020, the main stage contest for mind- and market- share will continue to be between Fabric, Ethereum/Quorum, and R3 Corda, with MultiChain holding its own. Other rising frameworks include:

  • Ant Financial’s blockchain platform
  • Ping An Technology’s FIMAX.

Interoperability will take centre stage

Already several networks cover identical or similar functionality, including:

  • trade finance
  • invoice factoring
  • shipping documentation
  • product provenance.

Several of these share ‘adjacent functionality’ – for example, supply chain, track-and-trace and trade finance. To deliver on the promise of frictionless processes, networks will need to talk to each other – somehow. Much of the debate for 2020 will be around exactly what this means:

  • simple message passing?
  • transfer of value between chains?
  • interoperability at state level?

Improved ties between blockchain/DLT and business management solutions

Ties will strengthen between DLT and existing business management solutions. In essence, as Forrester’s analysts observe, blockchain/DLT: “is an automation technology, focused on inter- rather than intra- company processes“. But even if only used for notarisation or time-stamping, there are the links between existing:

  • business process management (BPM)
  • digital process automation (DPA)
  • contract management solutions.

For Forrester, blockchain/DLT: “pure-plays don’t have the required process management and integration experience, while BPM/DPA vendors are under pressure to improve their capabilities to address complexity across organisational and national boundaries“.

While some vendors will build out blockchain capabilities for existing solutions in-house, others will move into the space through collaboration, investment or acquisition.

The permissioned vs. public network debate will deepen

The permissioned versus public network debate will see blockchain/DLT-based applications falling into two main categories:

  • consumer-focused DApps, which will usually use public, permissionless blockchains
  • enterprise applications, built almost exclusively on permissioned networks using enterprise DLT frameworks.

Forrester questions whether this is sustainable in the long term. Rather than having intranet-like silos, its analysts suggest enterprise networks might be better off leveraging public blockchains. They then:

  • concede this is not a realistic proposition today
  • suggest it should be an important strategic consideration for the future.

Vendors like Hedera Hashgraph and Kadena may add fuel to the an increasing debate.

Enterprise Times: what does this mean

Forrester’s ‘ambivalence’ can be summarised in the following: “Should you focus on getting these to interoperate, or would it be better to consider bringing public blockchains into the equation? We won’t see any definitive answers in 2020, but expect plenty of debate and exploration.

To Enterprise Times there is nothing overtly wrong about what Forrester’s predictions for 2020 – other than they are little more than summaries, mildly extended, of what has happened in 2019. On the other hand, Enterprise Times wholly agrees with Forrester’s concerns about ‘adjacent functionality’ across networks like supply chain, trade finance, food safety, product provenance, etc. This needs addressing or enterprises will decline investment in such networks due to incompatibility.

What does seem to be missing, however, is consideration of blockchain/DLT performance issues. While performance remains an issue, enterprises are unlikely to commit big time.


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