[COLUMN] What opportunities do Blockchain Alliance Europe members see in curbing the covid-19 pandemic?
In the past weeks, we have repeatedly heard that the coronavirus is an accelerator of digitization, which is in some way certainly true. However, I wonder if these processes merely replace the opportunities we have already missed, or the coronavirus infection control measures might also have a beneficial effect on accelerating the deployment and utilization of advanced technologies such as blockchain, mass data and artificial intelligence, and enable more optimized management of important digital systems in our country.
A veil of mystery over blockchain technology
Blockchain Alliance Europe notes that the massive use of blockchain technology and cryptocurrency is still separated by the abyss, or “valley of death that emerges from the first users and enthusiasm in adopting all new ideas or new technology,” as Geoffrey Moore describes the situation in his book Crossing the Chasm.
This is partly understandable, as testing new technologies is an important but strategically also riskier project, and blockchain technology is still partly obscured by the veil of mystery. Therefore, one of the main tasks for Blockchain Alliance Europe and our members in the coming period remains to speak more clearly about the business, organizational and financial advantages the technology brings.
Growing interest in cryptocurrency acceptance
Ten Slovenian companies and partners that are involved in the Blockchain Alliance Europe are working in the development, deployment and use of blockchain technology and cryptocurrency, or as part of an ecosystem of related companies. Members belong to different branches of the blockchain industry and therefore face unique challenges during this specific period.
Many sellers and manufacturers have diverted online sales in one way or another due to store closures and increased demand for impersonal services. Thus, we would also expect an increase in demand for a variety of payment options, which would also mean an increase in interest for Eligma’s GoCrypto system. The latter is intended for easy, completely offline reception of cryptocurrencies in a physical or online store, with the merchant receiving an immediate payment in euros. As Eligma reports, they have not seen a rise in demand for their services in physical stores, however, there is a strong increase in interest in online retailers.
While GoCrypto has seen a 60% drop in purchases in physical stores, this is not true for online stores, suggesting a change in shopping habits. This is why it is expected that many smaller, especially physical traders, will not survive the coming economic crisis. Trade sector is also predicted to be one of the areas that will undergo a radical change, especially if new online shopping habits persist.
New security mechanisms without passwords and usernames
Moving services online also increases the need to ensure the security and privacy of personal information. Netis has responded to this challenge with the AceBlock development framework, which, through blockchain technology, offers new security mechanisms for registering and logging in to users and storing and managing their data. State-of-the-art approaches allow users to self-manage personal information and enter web applications without entering passwords and usernames at all times, and make it easier for businesses to manage their data. However, companies are still wary of implementing such solutions.
As they explain in Netis, one of the reasons for the slow growth is that web service users (are) not yet sufficiently aware of the importance of personal data security and are not (yet) putting enough pressure on providers. The company expects an imminent change in trend, and are also convinced that blockchain technology will launch its big march into business and organizations shortly after some infrastructure changes are made possible at European Union level.
The Slovenian cryptocurrency hardware wallet has attracted a lot of attention
Security is also a core business of Real Security, a distribution consulting firm for security-based computer solutions and products from world-renowned manufacturers. As many companies have swapped workspaces for home offices, they have also become more interested in the already known and commonly used IT services and products that enhance online security. Our member also reports that some producers have made their programs available for free during times of isolation and social contact.
Real Security is also the parent company of the Slovenian cryptocurrency hardware wallet BC Vault, which has received high praise in the global cryptocurrency due to its innovative and highly secure design in recent months that has also positively influenced its demand. Although they detect interruptions in component delivery, they ensure that the delivery of the product is currently not affected.
Healthcare will change
The IT company Lucis, where they specialize in the development of healthcare information services, reports no business disruption. As they say, it is difficult to predict how the overall situation will affect further business at this point. However, they believe that the deficiencies seen in current system will serve as a catalyst for optimization and acceleration of the healthcare system in the coming period, promoting the digitalization and development of innovative models that will be useful even in the event of new epidemics.
Festivals, the great victims of corona-crisis
One of the industries that is experiencing the biggest losses at the moment is music. This area is covered by our member Viberate, which connects musicians with event organizers, agents and other music professionals. The startup recently launched a platform that allows easy creation of mobile apps for festivals and began with its massive promotion at major global events, which unfortunately coincided with all the epidemic-related measures.
They quickly responded to the situation with the Sick Festivals app, which records cancellations and losses in the festival area. The numbers they have come across to raise serious concerns: coronavirus control measures have affected more than 550 festivals around the world, with just under half already cancelled. As a result, as many as 7.8 million music fans will not attend their favorite festival this year, three billion dollars will be lost to ticket providers, and organizers and other festival service providers will suffer 9.8 billion losses during this period, with the most economic damage in June. The value of their application for the industry has been recognized around the world, and even mentioned by Forbes.
Credit ratings that will also take into account the business environment
At this moment, Bonsis Cooperative may have a unique opportunity to use blockchain technology and artificial intelligence to create a rating platform that would take into account both, the macroeconomic and microeconomic picture of the company’s business environment.
To conclude, it is too early to predict whether the digitalization triggered by the new coronavirus will really help the blockchain industry cross the valley of death that is separating us from the massive use of blockchain and cryptocurrency. However, the economic crisis which is already on the horizon will have a profound impact on many businesses and organizations. More conservative ones will want to reduce risks and be completely reluctant to introduce new solutions and technologies, while others will recognize the opportunity. Certainly, after the outbreak of the epidemic, a harsh business reality awaits us.
The column was originally published in Slovene newspaper Finance in a segment IKT Informator and is available here.