Former KPMG Anton Christoff on blockchain adoption
Anton is a former Blockchain Technology Lead and Emerging Technology Strategist at KPMG UK, currently an Advisory Board Member of The British Blockchain Association and an advisor for several blockchain startups, most notably Ocyan and LimeChain.
Anton, what's your background with blockchain technology?
I've been working on blockchain for two and a half years, predominantly within KPMG UK. I have also been interested in technology from a personal perspective and have been following its development for 6 years.
At KPMG UK, I helped shape and drive the go-to-market strategy and the partnerships and develop use cases of the use of blockchain technology in target industries. My major area of focus was around strategizing from an industry perspective and focusing on the tangible aspects of the technology - basically avoiding the hype - and suggesting what the firm’s and clients’ approach should be, pursuing the right partnerships and companies for our alliances and to shape up the global market
At the same time, I also worked on enhancing internal knowledge by building up the UK Blockchain Centre of Excellence as a cross-domain internal structure - a small team focused on up-skilling and helping the resources internally (their level of knowledge and understanding within their industry of focus, etc.), and last but not least, the client relationship and engagement.
I was often asked about blockchain as in how it works, does it affect them, what’s the appropriate approach and strategy etc., then exploring what's tangible to pursue, what’s feasibly possible to do with the tech, understanding if it’s mature enough within a particular area of focus and where it’s standing on the digital transformation roadmap.
I left KPMG not too long ago, and since then I’ve been focusing on a few blockchain startups that I advise and really enjoy working with. It’s great to see how Ocyan and LimeChain have been both recently listed as some of the top trustworthy blockchain companies for 2019 by TechReviewer.
What do you think are the barriers to blockchain adoption?
Blockchain reminds me of the early 90s, the early days of the Internet. There is a lot of misconception and confusion in companies around technology and the market itself. I think we could still use a bit more education! For instance, for some blockchain is only cryptocurrency which isn’t the case (cryptocurrencies are just one use case). Lots of companies and enterprises are still struggling to get the right mind set of what technology can do for them and how they can benefit from it. Education and clarity over industry use cases is a very big challenges.
The other challenge is around the hype. There’s lots of noise mainly around the crypto space, for instance the cryptocurrency prices going up and down, the volatility, ICOs and the fraud associated with them. When technologies are in the early days, people can do great things with it and also the opposite. These factors can seriously obstruct the adoption of the technology and its development.
Another challenge is around the level of maturity of the technology (which is developing as we speak). Standards are not there at the moment. Everyone seems to be focused on building their own solution, their own standard, so the challenge will be on how these blockchains will be able to communicate between themselves, but also with the legacy infrastructure. There are still a lot of gaps to be addressed.
In regards to the technical side of the enterprise adoption, if you are a big global corporation which has hundreds, thousands of different systems in place up and running, and you want to implement a blockchain solution within this infrastructure, within this architecture, you need to have the assurance that the systems will interact and integrate with each other. Integration has been a huge bottleneck in the digital transformation (let's call it the life cycle): a lot of systems don’t communicate with each other so the databases across haven't been properly updated.
One of the benefits of using a distributed database is addressing one of the major issues we are experiencing with the centrally governed systems and central database models today: we are not able to always keep up-to-date and to really get the latest state or the latest status of the process.
Let's not forget the change factor: people are resistant to change. They need someone to really help them along the journey, to really show them a roadmap from step by step, a logical one, educate them, and help them understand the benefits of having something in a different way or bringing in something new. The change management side is frustrating but it's quite crucial.
I think the biggest challenge to blockchain adoption is not the technology, but understanding where blockchain fits. Do you actually need it? Where do you need it? How do you need this implemented? It's about the technology supporting business, supporting real-life interactions, not vice versa.
What can enterprises do to adopt technology quicker?
Enterprises should invest more time and resources to understand, educate, explore, and experiment and see where this new technology can fit in their processes, their business and operating models. And they are already doing this at some level which is good.
In order to get great traction, I think joining forces and collaborating with peers and even competitors is essential. Think of creative consortia and associations! At the moment, companies are predominantly experimenting in silos on building something internally, this is how you usually start because it helps you better understand the technology, but the real power is the network effect of it. Blockchain for me is a trust based network of peers which communicate and interact directly with each other in a trustless context. Companies need to start engaging and collaborating more with their network of partners, suppliers, clients/customers and even competitors in a much more active way.
Where do you see blockchain being used most/ have the biggest impact in the next few years?
My guess is in the back-end infrastructure. I see blockchain being the middleware, a layer of trust on top of the existing Internet infrastructure. I see blockchain consolidating, standardising and facilitating/moving data across, knowing what data needs to go where, keeping the content and providing an immutable audit trail of interactions/transactions. I see it is a pure backend element, having a system in place which can act almost as an integrator for all your other systems in place, which will control and interact with other systems and will hold the latest state or status of the process and store the history or audit trail.
Thinking about IoT, all the devices and sensors and the information flowing in it can go to the blockchain and the technology would know where to send this information across in a safer and secure way.
In an AI context, blockchain could potentially keep an audit trail of all the records and changes made within the decision based algorithms and the code itself, meaning all the decisions made and the code changes which were implemented in the ML/AI engine could be easily stored as records and referred to when needed.
Blockchain could almost be like a smart API gateway, it would say “right now, I have in my enterprise around 50 different systems and I would put a blockchain in the middle to facilitate, further automate and integrate all those systems.” It could be helpful in keeping a single source of truth without having a single point of failure, like being a single layer of trust, a place where you can log on and see what has happened, who did it when it was done so on so forth.
That's why blockchain is so powerful in multi-peer decision based processes of interactions and transactions involving value exchange, traceability and consent, settlement and clearing etc.: it provides you with a system that shares a copy of this information among the peers of the network and everyone can see the latest state of the process in almost real time, but most importantly help to better interact in a predefined and a bit more automated way.
In financial context for me one of the most powerful use cases is the settlement element, including the clearing/billing and interbank transfers. Today, if you want to send money it can take two to five days and it costs you a lot. Using blockchain you can do this in seconds, in real time and almost no transaction cost.
Reconciliation happens automatically so yeah this simple in Financial Services. Outside of FS, currently it’s all about Supply Chain traceability and transparency at the moment with great ventures gaining traction within industries. Also healthcare and pharma are looking deeper into the vast possibilities, as well as wider manufacturing, government, telecoms and mobility.