Market Basics

Blockchain has continually proven itself across the cryptocurrency industry since Bitcoin’s launch in 2009. Today we know that distributed ledger technology can streamline record-keeping by providing benefits such as greater transparency, ownership of data, and democratized governance. Since 2017, multinational corporations have been using blockchain technology to improve business operations. In this article, we take a brief look at the global brands that have already put blockchain into action.

Is Blockchain a Public or Private Application?

Before we address blockchain’s adoption across the corporate world, we will first address the flexibility of blockchain technology. Although widely known as a public application that is transparent and decentralized, blockchain is also widely used as a private application. Bitcoin, Ethereum and many other popular cryptocurrencies transact on public open-sourced blockchains. Although sensitive data is encrypted on public blockchains, the network itself is open. Private blockchain databases are permissioned, which enables an organization to control admission and access – and exactly what data is made available to what users.

How Has Blockchain Been Used by Large Credit Card Companies?

American Express has dipped a big toe into distributed ledger technology. In May 2018, the credit card giant launched a blockchain pilot to enable merchants to create individualized rewards programs for long-time cardholders. American Express created a private channel on a permissioned blockchain with each rewards merchant to facilitate information transfer. They also implemented smart contracts to fulfill those rewards automatically and pass transaction information back to American Express. In 2021, Visa, the world’s largest credit card issuer, rolled out a crypto-linked credit card. Mastercard, the second-largest credit card issuer, announced similar plans and accumulated a waitlist of over 140,000 people. Through these services, crypto credit card users will gain the ability to earn crypto rewards, instead of the old standard of points or cash.

How is Blockchain Being Used by Automakers?

In July 2018, Toyota launched an extensive blockchain trial across its leasing and financing empire in Southeast Asia. The automaking giant kicked off the pilot by becoming the first global company to issue debentures through blockchain via its Toyota Leasing Thailand subsidiary. The second phase of the project employed blockchain to service leasing deposits. A third phase incepted a project called Bond Coin for Toyota Leasing’s settlement system. Beyond leasing, blockchain technology has other potential applications for automakers such as:

• Data collection needed for autonomous vehicle technology – The key to fully autonomous vehicles is the collection of data, which blockchain technology can help curate.
• Assembly line logistics – Many moving parts coming from different entities are required when creating a car. Blockchain technology can potentially lead to more optimized supply chain management.
• Smart Contracts for Buying and Selling – A move to the blockchain can open the door to quicker verification, eliminating the cumbersome process of buying or selling a car.

While blockchain technology has only been implemented by select automakers and is still in its infancy, the prospects for use in this industry are promising.

How is Blockchain Disrupting the Diamond Industry?

In early 2019, DeBeers, the world’s largest diamonds procurer, reported that it had successfully tracked 100 high-value gems using blockchain. DeBeers wants to spearhead industry efforts to verify diamonds’ authenticity – and confirm they are not sourced from conflict zones where gems finance violence. Using a private blockchain, DeBeers created a secure digital ledger to trace the journey of rough diamonds from mine to cutter to polisher and jeweler. With the pilot’s success, DeBeers onboarded five leading diamond manufacturers to develop an industry blockchain platform called Tracr.

When Did Blockchain Begin to Change Concert Tickets?

In December 2019, Ticketmaster, the world’s largest ticket distributor, announced that it was actively testing blockchain across its systems. By applying a distributed ledger, Ticketmaster took on the biggest challenges facing the billion-dollar industry: fraudulent tickets. Ticketmaster began piloting a private blockchain and smart contracts in early 2020 with a Pearl Jam concert. Since then, Ticketmaster’s advances with blockchain have enabled better price discovery and fewer counterfeits. IBM has since launched a public blockchain, called True Tickets, to compete with Ticketmaster. Today, True Tickets identifies all buyers and sellers to ensure tickets are legitimate.

What Global Corporations Use Public and Private Blockchains?

In early 2020, Siemens, the German conglomerate, announced that it was developing new blockchain-based business models for its energy division. In Spain, Siemens Energy has launched a new private blockchain platform for trading renewable energy, enabling consumers to reserve electricity from their preferred energy sources. In Western Africa, Siemens launched a public blockchain for a crowdfunding project called Connect2Evolve. Donations to the project are financing a solar plant and a microgrid that will supply approximately 3,000 residents with clean electricity. Connect2Evolve uses a public blockchain in concert with impact tokens to track how many kilowatt-hours of clean energy are produced per donation.

What is Blockchain’s Future with Global Companies?

We’ve covered just a few of the many corporate blockchain projects that are in progress. With this said, technology analysts believe it may be many years before global companies fully realize blockchain’s potential. For example, transmission control protocol/internet protocol technology (TCP/IP) is the packet-switching technology, launched in 1970, that enables computers to connect over long distances. Despite this breakthrough, it took thirty years before TCP/IP was fully adopted globally. It may be decades before the world fully adapts its largest institutions to blockchain and its bold new way of using information.

Three Takeaways

• Blockchain are most notable for being the base layer of the crypto industry since 2009, but 2017 was the year that the technology took hold inside large corporations.
• Toyota, Ticketmaster and Siemens are just a few of the global brands that are using private and public blockchain technology.
• Consumers are just beginning to experience use of blockchain technologies across industries such as auto leasing, concert tickets and utilities.