Deloitte: Alliance development will be key to blockchain success in 2017, we will pay close attention

Deloitte, one of the “Big Four” global audit firms, is an early adopter of blockchain technology, and 2016 has been a busy year for the consulting firm. Earlier this month, Deloitte announced an investment in UK blockchain startup SETL, a company researching the use of blockchain for payments and settlements. This is reportedly the first time Deloitte has publicly invested in a blockchain startup, and the two companies have begun developing contactless bank card solutions for Metro Bank.

In October, the firm announced the launch of its Deloitte Catalyst incubator, which will focus on disruptive technologies, including blockchain, making it clear that the firm is confident in its involvement in blockchain, a technology that is primarily focused on disrupting the financial services industry.

However, a survey report from Deloitte this month shows that blockchain technology is not only disrupting financial services. Indeed, most business executives surveyed have at least some understanding of blockchain and its potential. Consumer products and B2B manufacturing industries will be at the forefront of embracing blockchain technology, just like the financial services industry.

By 2017, blockchain is likely to make its mark in a wide range of industries, including news media, telecommunications, and manufacturing.

Deloitte managing director David Schatsky said in a statement:

“This diversity of applications may just be a testament to the versatility of the technology. But it may also reflect the fact that blockchain’s impact on businesses across industries is not yet fully understood.”

By 2017, industries will certainly have a clearer understanding of how blockchain can disrupt these markets. But for 2017, the financial services industry will continue to be the biggest target for this technology.

Eric Piscini, Deloitte Global Blockchain Leader, said:

“2017 has the potential to be a banner year for blockchain in the financial services industry. In Deloitte’s recent blockchain survey, only 12% of financial services executives said their companies have already deployed blockchain products. But they plan to move faster: 24% said their companies plan to launch blockchain services in 2017.”

Piscini said one of the big trends of 2016 will become a key factor in blockchain success in the new year: blockchain consortiums.

2016 saw a number of banking groups, technology groups and financial technology players joining forces to explore blockchain use cases and develop real-world solutions. One of the largest groups is the R3 blockchain consortium, which Deloitte will be watching closely in the coming year.

“Industry alliances will be critical to unlocking blockchain’s value and keeping it relevant in 2017…With over 20 global blockchain alliances in place today, we are well on our way to blockchain success.”

He also said that the power of collaboration will bring new strength to blockchain exploration.

“The reason why small consortia are so important is simple: if you’re the only one using a blockchain, then the value of that blockchain is very limited. So you first need to add a few significant players to the blockchain, which is what we call a ‘minimum viable ecosystem’.”

But, like any emerging technology, the blockchain space has its skeptics. 2017 will also see increased skepticism, and R3 has had an eventful year: the group missed its fundraising target this year, raising $59 million from its members, compared with the $200 million it had hoped to raise. To make matters worse, some of its top members — Goldman Sachs, Santander, Morgan Stanley and National Australia Bank — have decided to leave R3.

However, confidence in the development of blockchain remains - some even believe that these setbacks will only clear the way for the real winners in the industry. For example, Chris Finan, co-founder of blockchain startup Manifold Technology, said these troubles actually bring some hope, allowing people to see more clearly how blockchain will affect the global market.

“When the sheen wears off some of the promises of technology that never materialized — that this would be a panacea for capital markets, that would help institutions get rid of risk completely — I think people will start to say, ‘OK, let’s think about this a little more realistically.’”