I am in this blockchain world for the last few years and I have seen skepticism, hype, denial, enthusiasm, speculation, greediness and disappointment. The cliche “roller coaster experience” is quite relevant definition about what is happening in the crypto world. On one hand, many people share the conviction that the decentralised spirit is out of the bottle and there is no going back. They claim that we are on the brink of huge paradigm shift and Web3 will transform how we do business, shop, interact and live. On the other hand, some groups take more conservative and down-to-earth stand and discard blockchain as useless. They have clear arguments — no proven real-world application of the technology, almost no working blockchain products, prevailing speculative interest and pump and dump schemes. Other people are fascinated with the utopian, philosophical and idealistic aspects of the decentralised models. They present blockchain as the game changer and equaliser that will bring fair distribution of value, transparency, real privacy and ownership of data. These believers point at the subversive nature of decentralisation enabling human race to escape the “zero-sum game” and “us vs. them” mentality.
Where the truth lies? As usual, extreme opinions could likely become dangerous and misleading. Blockchain won’t fix the major problems in our planet and won’t make this world a better place instantly. It promises an opportunity to migrate to new protocol and infrastructure for direct interactions and exchange of value. But exactly the potential advantages of blockchain make it very hard for practical implementation in specific products. Needless to say, it is a tough job to create a centralised product on your (cloud) server and database. Yet, there are some rules of the game that can boost your chances of success — make something useful, bring early adopters, improve the product, develop network effect, etc.
What if you would like to build decentralised product? You encounter whole bunch of challenges that multiply the difficulty several times. Some of them are listed below:
- How to align the interests of the participants in the network?
- How to develop the token economy and give inherent value of our tokens?
- How to keep certain transactions private and make others public?
- How to incentivise certain user behaviour with tokens?
- How to offer excellent user experience on top of emerging technology at its infancy and still in intensive R&D stage?
- How to cover the costs for executing smart contracts and running transactions on the public blockchain networks?
- How to solve the critical issues with identity management of users? How they can remain anonymous in order to protect their privacy and in the same time make certain transactions legally binding with reference to real identity of users?
- Where and how to store the files in order to avoid vulnerabilities typical for centralised platforms?
These are just some of the issues that blockchain entrepreneurs encounter at the very beginning of building their dapps. Many of the founders just quit because it is extremely difficult to overcome so many hurdles along your way.
So, more pragmatic approach might be helpful. I call this mentality framework “do not sell blockchain” (even if you love it). Some insights I have discovered in the hard way are below.
Do not consider blockchain universal cure-all technology that will fix the world. The truth is that DLT won’t save the mankind and make the planet a paradise with pink ponies jumping joyfully on green fields. Of course, blockchain can bring certain benefits in the ways we create and exchange value. But it won’t by itself solve the toughest problems we face in the contemporary world.
Related to the above — STOP PREACHING! Ordinary people do not care about new distributed infrastructure, collective intelligence, decentralised models of re-engineering business processes, full transparency and accountability of systems. They just don’t.
Blockchain alone is not yet quite functional In many cases hybrid solutions (blockchain plus cloud or other off-chain server apps) have better chance for business development. The technology is at its infancy, the protocols do not ensure enough speed of running transactions, the businesses are bound to their ERP and CRM systems and won’t jump in the dark abyss of decentralised networks and dapps. So if you present blockchain as an underlying security layer that will bring data integrity and protection to their existing software solution — you may have a better chance to do business.
Companies are scared to share data in one network with other organisations Even if the benefits of data synchronisation across the supply/value chains are very big. The businesses are obsessed with the idea of owning and controlling their data. You cannot blame them — all business model of the future will depend on knowing and extracting value from your data. So if you do not have the answer about level of access controls and private transactions between participant in the network — do not go to serious corporate clients
User experience is the king Do not let the complexity of blockchain affect the user experience of your products. You do not have significant chance to make a business development or to launch a solution to the market if you UX sucks. Focus on ease of use and simplicity at all costs.
People and businesses do not care how things work below the surface. It is like explaining the principles of Internet protocols or cloud infrastructure. If it works, then it works.
The bottom line is that you do not sell technology, you sell solution. And if you do not explain the value you bring on the table with simple words — people will not understand you and won’t use/buy your solution. During developing our blockchain startup ReCheck we learned these lessons in the hard way.
The author of the article is Emiliyan Enev, CEO of ReCheck.io