IBM Sees Blockchain as the Next Big Thing

Computer Giant's Leap Into Blockchain Provides Validation of Its Potential

IBM pivots from its past. Getty Images

Prepare yourself!

The world is noticing blockchain.  At your next business meeting, don't be surprised that you'll be hearing executives using the term "blockchain" as often as they say "at the end of the day" or "we need to pivot". It's becoming the new buzzword for business.

Businesses are recognizing that the underlying technology for Bitcoin, which is the Blockchain, is a more efficient and effective way to transact not only just financial data but other information as well.

The Blockchain consists of a decentralized, distributed network that allows for a system that "cuts out" the middle man and central controls in a process that can hinder the efficiency of a system.  In finance, this allows for a cheaper way to send funds.  It also provides capabilities for areas such as smart contracts and even voting systems.

Initially, the underlying technology that provides the ability for Bitcoin mining, record keeping and creation of a distributed permanent ledger, was seen to be solely of interest to the geeks and libertarians who envisioned Bitcoin as the new form of digital currency. Even with all of the obituaries written about Bitcoin over the years, it hasn't gone away (in fact, it's grown in usage and importance) and the Blockchain infrastructure has now become recognized as a potential disruptor to not only how we handle finance, but how we build computer applications going forward.

The "Suits" Are Noticing Blockchain

Recently in New York City, a sold-out conference called Consensus 2016: Making Blockchain Real was held to a sold-out audience. Gone were the hoodies of past Bitcoin conferences and in came the suits and big names (including Larry Summers, former Treasury Secretary) to bless the technology, and find the areas for potential profit that may exist.

One of the big announcements at this conference was perhaps, the major blessing from the "old guard" of technology that not only is Blockchain "cool", but it could also be the key to creating computer applications in the future.

IBM Is Not the "Old Guard" Anymore

On Friday, April 29, 2016, IBM gave their support to Blockchain technology with a major release of their framework for securely operating blockchain networks. 

IBM is not only recognizing that Blockchain technology holds huge potential for businesses, but they've also recognized that many businesses are concerned about the security implication of the technology.   IBM's announcement focuses on the creation of a framework that provides “tamper-proof, trusted blockchain networks” with their cloud services. 

Jerry Cuomo, vice president, Blockchain, IBM pointed out this concern, “Clients tell us that one of the inhibitors of blockchain is concerns about security.

It remains to be seen how other companies will react to this new framework.  In an effort to increase the interest of companies to use their tools, and to educate companies about the Blockchain, IBM is creating what they call the "IBM Garage."  These will be places where companies can work with IBM teams to gain hands-on experience with their new tools to create code and small applications that show the Blockchain's potential.

Companies such as BNY Mellon and Deloitte are jumping onboard with applications for this new framework.  Factom, a startup out of Austin, Texas is also partnering with IBM on their beta release of IBM’s “Blockchain on Bluemix” which will allow for integration with Linux-based code to support multiple industries and diverse use cases.  Factom is focused on providing blockchain solutions and capabilities that are already addressing the way that contracts and even notary services are being done. 

IBM’s announcement may influence other companies to recognize the power of the Blockchain and a technology enabler for more systems efficiencies and capabilities than their existing systems. The recognition that a company like IBM, which had been seen as the "old guard" in technology circles is embracing the technology, may be just what other companies need to see to awaken their thoughts to the same potentials that IBM sees.

So, at the end of the day, when you find yourself in that boring corporate meeting, and you need to wake up the "old guard" that's still protecting the status quo, simply pivot and say, "Blockchain".  After all, that's what IBM is doing.