What industries will blockchain disrupt the most?

Louigi Verona
June 2019

Actually, blockchain has already disrupted a bunch of industries. Let’s take a look.

I. Online courses

The amount of online courses that teach blockchain has surged in recent years. According to Google Trends, searches for “blockchain course” have risen a 100% since 2015, peaking in 2018.

II. Quora Blockchain segment

A whole galaxy of Quora users has emerged, focused on promoting blockchain and covering blockchain related topics.

III. Raising Capital

Blockchain has allowed startups and con artists to raise lots of money in a completely unregulated environment. Even legitimate companies would typically offer tokens which come with no guarantees or rights for their holders, which means they are essentially a way for the company to get funds with no strings attached. This is definitely a revolution in the raising capital industry.

IV. Online fraud

Blockchain has powered the online fraud industry, by introducing an increased incentive to hackers: a single mistake on part of an exchange or a cryptocurrency user allows the thief to funnel the funds to their own wallet, and the original owners of the money have no recourse whatsoever, due to transactions being irreversible and the whole thing being distributed and essentially owned by no one.

V. Sanctions evading industry

A bunch of authoritarian countries are suspected to use blockchain for various hacking activities, like North Korea, in order to avoid sanctions and disrupt the infrastructure of Western governments.

VI. The conference industry

Blockchain conferences have spawned all around the world, increasing the profits of booth construction workers, venues and a certain segment of blockchain authorities who are paid to participate. Several thought leaders like the author of "smart" contracts are making big bucks being keynote speakers at those conferences.

VII. Illegal trade

Blockchain has intensified international illegal trade. According to a recent study, one-quarter of bitcoin users and one-half of bitcoin transactions are associated with illegal activity. Around $72 billion of illegal activity per year involves bitcoin, which is close to the scale of the US and European markets for illegal drugs.

VIII. Crypto-anarchism movements

Political movements are not industries, but the hype around blockchain has definitely empowered the adherents of crypto-anarchism and gave them a (false) sense that their cause is moving forward.

IX. Startup supporting industries

Since the surge of blockchain startups, a whole segment of companies purporting to help startups to succeed has emerged, from snake oil salesmen to genuine companies which make their living by helping blockchain startups setup their online presence, generate whitepapers, provide blockchain infrastructure, etc.

X. FOMO

The financial sector, experiencing FOMO, has spent over $550 million dollars on blockchain projects in 2018. Definitely, a disruption right there. Little reported results, but FOMO is like that.

XI. Climate change

Blockchain mining has considerably contributed to carbon emissions.

But while it is important to understand which industries were disrupted by blockchain, it is also interesting - and perhaps even more important - to note which segments of society blockchain has so far failed to disrupt.

I. Critical thinking

If anything, critical thinking has dramatically declined since the introduction of blockchain. Idealistic engineers and young entrepreneurs at times consciously decide not to look into blockchain criticism, scientific studies on the topic, and approach the premise of their own companies with little skepticism.

II. Learning from the past

Humanity has always been a poor learner from its past, and mistakes we’ve already made once are continued to be repeated again and again. Although a fairly obvious case of technological idealism, blockchain has so far failed to encourage the deep reflection that from time to time we are charmed by yet another technological wonder that we think will fix all of our problems.

While not all blockchain enthusiasts are so naive, quite a large portion of them are. Even if someone is not expressing it directly, many blockchain startups demonstrate a heightened level of hubris, promising to fix whole industries that they know nothing about. And their whitepapers promptly demonstrate their level of ignorance.

III. Banking

Cryptocurrencies have failed to revolutionize, disrupt or in any other way influence the world of banking. It turns out, nobody wants to do business in an unregulated environment using irreversible transactions, which end up on permanent public record.

And the latter feature matters not because businesses want to conceal illegal trade - illegal trade loves crypto! - but precisely because it is legal: not all legal business transactions can be or should be made instantly public.

But hey - at least blockchain managed to induce a strong case of FOMO. And so the banks again and again proudly announce their blockchain initiatives, and then try to never bring up the matter again.

IV. Centralized anything

Blockchain has so far failed to disrupt any centralized service. All the promises of blockchain security and efficiency are mostly misleading and make sense only for unregulated peer-to-peer environments.

Centralized services, on the other hand, offer the level of support really valued by customers. Support that would be stripped in a decentralized environment, where you are on your own and nobody owes you anything. A smart contract needs to be changed due to changed circumstances? Sorry, you should have thought of this before. Money stolen from your crypto wallet? Your problem. Lost a private key for your blockchain-powered service? Cannot help you.

Conclusion

Google trends show that interest towards blockchain peaked in January - February 2018. Since then the amount of Google searches related to blockchain has considerably declined, and continues to drop.

For those worried about blockchain disruption, perhaps it is coming to an end. But not to worry - some other technological placebo promising to fix humanity is bound to show up in several years. It always does.