Deloitte has been busy feeding the negative blockchain news cycle.

It recently published the results of a survey of more than 1,000 “blockchain savvy” managers. The survey found 40% of them were “wary” of blockchain’s efficacy. In the U.S., 44% were skeptical.

Two years ago, only 34% expressed skepticism.

It gets worse. In the U.S., 30% said they still lacked a “compelling application” to justify implementation [of a proposed blockchain project, presumably].

On the face of it, this is not good news for blockchain enthusiasts. (Let’s put cryptocurrency to the side. This is about the future of the underlying technology.)

It doesn’t make much sense to me.

In the past two years, blockchain technology has made huge strides. There are more blockchain use cases being tested than ever before. Companies have the choice of joining consortia like R3 and Hyperledger that are making significant progress in developing and testing blockchain technology.

From TradeLens, the IBM-Maersk blockchain venture, cutting global shipping times by 40% and having 94 partners to the World Bank issuing a blockchain-only bond (“bond-i”), there are dozens of examples of live use cases.

The list goes on and on. Stock markets are being put on the blockchain. Property, produce, and invoices are too.

Skepticism should be shrinking, not growing.

It doesn’t make sense unless you consider Gartner’s “Hype Cycle”.

Then it makes perfect sense.

So what is the Hype Cycle and how does it work?

It has five different stages…

  • Innovation Trigger: A potentially transformative technology generates strong media interest and proof-of-concept stories. But most viable products are years away. Tech-savvy individuals and true believers understand this. Practically everybody else doesn’t.
  • Peak of Inflated Expectations: Reports of a few success stories push expectations higher. Patience begins to run thin. Failures are common but less publicized.
  • Trough of Disillusionment: A more sober reality sets in. Beta tests either fail outright or fail to generate mass adoption. Weaker companies fail. Investment continues at a slower pace and is contingent on meeting more stringent standards.
  • Slope of Enlightenment: The technology enters the mainstream and its benefits are more widely understood. Better second- and third-generation products are developed. Funding for pilot projects is easier to obtain, but many companies remain cautious.
  • Plateau of Productivity: Mainstream adoption arrives. Criteria for assessing use cases are clearer. The technology’s applicability and relevance become self-evident.
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