Blockchain can no longer be considered simply a fringe technology that may be suitable for cryptocurrency companies and nothing more. In fact, the largest and most influential companies in the world have all launched blockchain projects. This doesn’t necessarily mean that Distributed Ledger Technology (DLT) is on the verge of widespread acceptance by mainstream businesses, but it is an intriguing development nevertheless.

Who Are the Biggest Companies Ready to Use Blockchain?

Industrial and Commercial Bank of China (ICBC)

By all measures (revenue, profits, assets, and market value) the largest single business enterprise in the world with over $165 billion in sales and assets of $4.2 trillion. Last November, the bank filed a patent for using sharable blockchain technology to authenticate and store digital certificates, such as birth, death, and graduation certificates. The sharable blockchain would then make this data available to other entities that require verification of the same documents, without the need for customers to obtain them individually from the issuing authorities and then submit them separately to these entities over and over again. The bank has been very hush hush about this project, as have most of their brethren to varying extents, but something is definitely stirring in this space.

The China Construction Bank Corporation (CCB)

With around $143 billion in sales assets of $3.63 trillion, is another powerhouse that is exploring the use of DLT, though a little more publicly than their previously-mentioned rival. CCB, in collaboration with several major insurance companies, sells those companies’ insurance policies to its own banking customers. They call this “Bancassurance”. Last fall, they announced a partnership with IBM to use IBM’s blockchain to decrease the delays in data and document transmission between the insurance companies and their own banking branches, while vastly improving the security, transparency, accountability, and trust associated with their Bancassurance processes. Though this project is still in the testing phase, all indications suggest that it will become an integral part of their operations. CCB has also announced a blockchain-based platform for issuing loans to small businesses. They have also partnered with Baidu to focus on fintech and blockchain technology.

JP Morgan

Next on the list, with $118 billion in sales and around $702 billion in assets. They designed and built their own internal blockchain based on the Ethereum platform, which they’ve named Quorum. They describe it as “ideal for any application requiring high speed and high throughput processing of private transactions within a permissioned group of known participants” while addressing “specific challenges to blockchain technology adoption within the financial industry, and beyond.” What’s interesting about the Quorum implementation is that it provides both public and private transactions. The state of private smart contracts, for example, is only known to and validated by parties to the contract and approved regulators and no one else. Quorum is open-source, and downloadable by anyone. Pharmaceutical giant Pfizer, as well as London’s financial services heavyweight HIS Markit, have shown interest in Quorum. In addition, JP Morgan and Microsoft have teamed up to explore blockchain-based financial services tools.

Berkshire Hathaway

Warren Buffet’s company, with $235 billion in sales and assets of $702 billion, is in fourth place this year, and has also, surprisingly, become a player in the DLT space. This is quite ironic, since Buffet has gone on public record calling cryptocurrency “rat poison squared” and “a mirage”. However, the company also seems to recognize the incredible potential of the underlying technology and has ventured forth into DLT projects. For example, early this year Hathaway’s BNSF Railway Co. joined the “Blockchain in Transportation Alliance” which wants to establish DLT standards in areas such as vehicle maintenance, quality control, and fraud prevention, as well as in BNSF’s primary area of interest, freight transportation.

The Agricultural Bank of China Limited

With $3.4 trillion in assets but only $129 billion in sales, is currently in fifth place. In July of 2017, in partnership with Hyperchain, a Hangzhou-based blockchain startup, they developed their own DLT network for automating the process of offering unsecured loans to its agricultural eCommerce merchants. This innovative online supply-chain financing system overcomes the hurdles that many farmers and small agricultural business have encountered when trying to obtain the credit necessary to purchase products and equipment.

How About the Rest of the Major Players?

Truth be told, each and every one of the next five largest companies are also exploring blockchain technologies to improve their businesses. Bank of America, Wells Fargo, Apple, the Bank of China, and Ping An Insurance, the largest insurance company in the world, have all launched DLT projects, either publicly or privately. In addition, many of the well-known companies further down the list, such as Microsoft, Alphabet, Walmart, Daimler, and Mitsubishi, have also made it clear that they are exploring these technologies.

Barriers to Adoption

However, despite these promising ventures into blockchain technology by the world’s largest companies, many skeptics remain, and even some of its supporters have certain reservations. For example, Lin Sen, director at CPCW, a Shanghai-based consultancy helping Chinese financial institutions launch DLT projects said, “Blockchain is serving as more of a marketing tool than as infrastructure.”

The security and privacy of a bank’s transactions are also of great concern to this sector, given the public and open nature of blockchain technology. Banks are generally very private about their business dealings, both for the protection of their customers and themselves. So additional layers of encryption have been added to some blockchain implementations to anonymize transaction entities and to keep data private and inaccessible by others on the network. Some maintain that it won’t be until new technologies are developed on top of blockchains, that they can provide genuine data security. Zero Knowledge Proofs (ZKP), the ability to authenticate transactions without conveying any information about them, and Homomorphic Encryption solutions, which allows calculations to be performed on encrypted data without decrypting it, are good examples of these.

Efficiency within the blockchain network is another concern that must be resolved. Though individual transactions occur with tremendous speed, aggregated transactions, which are used by centralized systems to, for example, net all the trades down to a single day’s transaction that needs to be cleared, are much more efficient than requiring every individual trade to be transacted on a DLT system, one by one.

Conclusion

It should be obvious from the above that blockchain is rapidly developing a presence in a huge diversity of industries above and beyond just cryptocurrency and fintech. Yes, there are problems that must be addressed and resolved, but that has been the case throughout history as new technologies emerge and their use-cases are explored and eventually established. Look for it.

Written by:

Parul Gujral, CEO-Snowball