Token Adoption Strategy
How to figure out the first path in your blockchain token roadmap
Due to the transformational nature of the the blockchain, it is diligent to structure a roadmap which takes into account industrial-scale infrastructure change migrations. I believe that the blockchain adoption framework developed by the Harvard Business Review is an ideal lens in which to analyze this path to transformation. Having a strategy for mapping out the adoption path of your token is actually simple once you understand what your looking for.
In order to make this easy to understand, we will analyze the timelines of TCP/IP and blockchain simultaneously. The Internet is an excellent analogy for the type of transformational change that blockchain can affect on entire industries. Lets jump in.
History suggests that two dimensions affect how a foundational technology and its business use cases evolve. The first is novelty — the degree to which an application is new to the world. The more novel it is, the more effort will be required to ensure that users understand what problems it solves. The second dimension is complexity, represented by the level of ecosystem coordination involved — the number and diversity of parties that need to work together to produce value with the technology. For example, a social network with just one member is of little use; a social network is worthwhile only when many of your own connections have signed on to it. Other users of the application must be brought on board to generate value for all participants. The same will be true for many blockchain applications. And, as the scale and impact of those applications increase, their adoption will require significant institutional change. (Iansiti, Lakhani, 2017)
So the framework establishes a 4-quadrant dimension where blockchain use-case novelty runs horizontally and market coordination effort runs vertically.
This framework should apply for most technological adoption cycles. The names of the adoption stages (quadrants) are, in order of difficulty: Single-Use, Localization, Substitution and the end-game Transformation.
Technological Adoption Compared
Adoption Stage: Single-Use (low novelty, low coordination)
Description: Better, cheaper, high focus solutions to existing problems
TCP/IP Example: Email was the first single-use application for TCP/IP that was a better, cheaper, focused solution to the problem of long distance communication.
Blockchain Example: Crowdfunding and token-incentivized community growth is the first better, cheaper and focused solution to the social network chicken-and-egg problem.
Adoption Stage: Localization (high novelty, low coordination)
Description: More complex solutions building on single-use, but only need a limited number of users to provide value
TCP/IP Example: Now that long-distance communication is easier, information can be distributed across large geographical boundaries. The first networked applications appear on the “Internet”.
Blockchain Example: Holding blockchain tokens represent economic interest as part of a decentralized economic community.
Adoption Stage: Substitution (low novelty, high coordination)
Description: Solutions built on Single-Use and Localized applications, but require large and increasingly public coordination
TCP/IP Example: New business models become possible (Google, Amazon), but still requires lots of coordination in the form of telecommunication infrastructure, user training, IT departments and hardware purchases.
Blockchain Example: Tokens used for market signalling as part of curation of teams, projects and ideas. Price is a game-theory schelling point, allowing complex speculation and arbitrage activities. Needs a coordinated industry of wallet and exchange software providers, along with increasingly open-source software, to first be built.
Adoption Stage: Transformation (high novelty, high coordination)
Description: Building on previous adoption, fundamental change to entire industries is now possible
TCP/IP Example: The Internet is able to fundamentally change entire ways of doing business, and enables countless other innovations building on top of seamless information distribution.
Blockchain Example: The Internet-of-assets is fully realized, allowing for seamless economic coordination around communities and payments. Identity is self-sovereign, allowing fraud-proof participation in governance.
This framework should be a guideline for understanding how adoption of blockchain technology is occurring. The industry is highly dynamic and has existed for more than 10 years. As the early adopters push forward, they are taking advantage of previous adoption stages. As new people are introduced to blockchain, they are starting by “joining the community” at the first stage. We are seeing innovation at each of the adoption stages, so there is no single static snapshot of the entire industry at one time.
This post is a single-use solution to how to strategize about a blockchain token adoption roadmap. If you’ve benefited from it, use your ability to curate! Please clap and share to send an Internet signal that there is value in diligence, a well-defined roadmap and easy-to-understand metaphors for blockchain understanding. I will be focusing my attention on the industry in 2018 so follow me and Workspace0x and join me on the journey to Transformation.
References
Iansiti, Marco. Lakhani, Karim. (2017, January). The Truth About Blockchain. Retrieved from https://hbr.org/2017/01/the-truth-about-blockchain
