The Price of Bitcoin Is Up. But We’re In Healthcare. So Who Cares?
Bitcoin is to blockchain what the Model T is to cars. It didn’t reinvent the wheel, it just applied it to a better solution. Making travel easier has had a compounding effect on businesses that either revolve around travel or evolved from making travel easier. Now, 111 years since affordability was brought to the automotive industry at scale, we have easily customized compacts like the Honda Civic, V12s in Formula 1, Tesla in all its glory and need we forget, the car NASA left on the moon.
Blockchain technology is a source of as much confusion as it is potential. The fundamentals are not that hard to learn, yet it’s perpetually perceived as an overwhelming concept once one meets that ah-ha moment. So why is so hard to answer Why Blockchain?
I was once asked “Why blockchain” about a dozen times in a single 30-minute conversation from a crypto enthusiast. Despite possessing hands-on experience in enterprise implementation, it was hard for me to defend against the Jamie Diamond-esq Davos level rant. It was so ego driven, so technologically disconnected from reality and so fraught with uneducated macroeconomic assumptions that I legitimately was a deer in headlights, frozen in stupidity.
After listening to the vision of blockchain technology being described a complete failure due to the ‘17-’18 BTC downturn, I left the conversation distraught at the belligerence I encountered. This was someone who I had respected as a Wizard of Industry (a few steps removed from Titan). I was legitimately offended on the staggering degree of egotism.
After a long, long walk home, I knew it was my fault. I was the more experienced blockchain professional yet I couldn’t communicate much less articulate a defense. Pulling my head out of the sand after 5 years in the trenches meant getting on par with what’s currently trending as opposed to being fixed on what’s expected of the technology in the future.
Blockchain applications function like mini-economies. Both require a network of participants, assets to be transacted, a medium of exchange and a transaction flow to be operational. The difference though is that the math and science behind the peer-to-peer nature of blockchain technology enables these mini-economies to run without the need for institutions that prop up actual real-world economies such as banks or software companies for that matter.
The entire value proposition of a blockchain application with a single use case is often so hyper-focused that the volume of network participants who find value in the assets being transacted is more often than not severely limited. Hence, the rise of so many cryptocurrencies to fuel so many mini-economies and the subsequent failure of so many single, one-off use cases. This has created a roadblock for incorporating blockchain technology into the broader scope business ecosystems that require complex business logic.
Consider for example, the risk of fraud, theft and overall effort it took to fulfill an order in the days of the Pony express versus Amazon 1 click. The principal is the same, to serve as a facilitator between supply and demand. It took 139 years (1860–1999) for the flow of commerce to evolve from the Pony Express to Amazon 1 click. In the 10 years since Bitcoin came online, blockchain technology, not Bitcoin, has positioned itself to affect information technology in the same capacity, but on a global level. That is, do more with less in a more secure fashion than before, and do it at scale.
As the information age musters on, I predict blockchain technology will have an equivalent impact of the same 139-year gap between transcontinental horseback riding and 1 click e-commerce ordering. It will do so in less than 30 years from its inception. In other words, it will provide the same degree of influence of automation in roughly 20% of the time.
I am not saying Bitcoin doesn’t have value. It’s a finite resource that is in demand. Of course it’s going to have value, but consider this- a penny is still a penny, but the 1977 D Lincoln Penny from a certified mint state could be worth up to $8. This particular penny has value in specific transactions within a specific circle of people. Point is, where’s there’s money to be made, value is relative, not absolute. Crypto is no different.
It’s important to note that unlike a penny, crypto is programmable. On top of that, the total supply of any given mint is usually 100% transparent through a block explorer at any time to anyone. Great. Why is that important? Because of what we learn from the data. The future of blockchain isn’t crypto- it’s infrastructure. It’s the type of infrastructure that brings honesty to capitalism in a mathematically sound way. We will take what we’ve learned from experimenting with crypto-economics and embed it into complex business ecosystems rather than allow it to simply remain just a method of transaction.
If you could remove the human condition from business or data manipulation for that matter, where would you start? I tell clients at Blockchain Healthcare Review not start with Satoshi’s white paper. Rather, start with what you know, which is usually the business that you’re in.
Understanding how blockchain technology can be of use is 80% about business, 20% about technology. If you switch that order, you’ll likely spend a lot of time with your head in the sand, like I did.