When Bitcoin debuted in 2009, it not only launched cryptocurrency, but also generated a lot of buzz around blockchain, the technology that powers crypto.
The buzz peaked in the late 2010s, when early adopters and people promoting the technology realized that blockchain was not bringing the major benefits they had hoped for. But even as the hype has died down, interest and innovation around blockchain has continued, according to Martha Bennett, an analyst at Forrester Research.
“Blockchain hasn’t produced the miracles it promised, which no technology does when you overdo it. But overall, blockchain has never gone away,” Bennett said. In fact, there are many prospects on the horizon for blockchain, she and other experts said.
Here are 12 blockchain trends to watch.
1. Blockchain has proven its value
Blockchain has shown in the 15 years since Bitcoin’s debut that it is a successful technology, said Brian Jackson, senior research director at Info-Tech Research Group.
“The technology itself is a great source of value and it’s proven to work,” he said. “It’s a great system.” The statement that blockchain is immutable and cannot be changed or altered is also true, he said. “No one has hacked it that we know of.”
2. It can be made energy efficient
Bitcoin and other cryptocurrencies do not rely on a central authority to oversee transactions. Instead, they use complex encryption techniques called cryptomining to verify transactions and control the creation of new units on the blockchain. The main approach to cryptomining, proof of work (PoW), requires enormous computing power. Miners use complex algorithms and power-intensive hardware and software to confirm transactions.
However, another cryptomining approach called proof of stake (PoS) requires much less energy and computing power. The Ethereum blockchain network moved from a PoW to a PoS mechanism in September 2022 and reduced its energy requirements by over 99%. This shift, known as The Merge, shows that sustainability can happen with blockchain at scale, Jackson said.
3. Trump’s election boosted cryptocurrency
New U.S. President Donald Trump has indicated that his administration will be more supportive of the cryptocurrency and digital assets sector, which has generated a lot of activity in that area, said Arthur Carvalho, associate professor of information systems and in analytics at the University of Miami.
“There is a lot of excitement around crypto and cryptocurrency again,” Carvalho said.
4. Governments provide more regulatory clarity
Trump also indicated he would roll back crypto-related regulations and enforcement actions that the Securities and Exchange Commission and other federal agencies put in place under the Biden administration, Bennett and others said .
“With recent political developments in the United States, it is expected that there will be clearer regulation than there has been so far as well as a crypto-friendly environment,” he said. Bennett said.
Similar developments are happening in Europe, she said, citing the European Union’s April 2023 adoption of the Regulation of Markets in Crypto-Assets, or MiCA, as evidence. The EU law, which came into full force in December 2024, establishes uniform European market rules for crypto-assets, adding clarity and regulatory stability to the region.
5. Tokenization of real-world assets is underway
Interest continues to grow in tokenizing real-world assets using blockchain. According to Bennett, tokenization makes it possible to split ownership of assets, such as real estate, racehorses and container ships, and then buy and sell them on the blockchain.
“It’s a case of fair use of blockchain,” she said. “But the challenge with something like this is how do you make sure that the real-world asset exists and is maintained in good condition?”
6. Stablecoin arrives as an alternative
The value of cryptocurrencies like Bitcoin can fluctuate significantly. Digital assets called stablecoins are designed to maintain a stable price. They can do this because they are pegged to a fiat currency like the US dollar or another stable asset like gold.
According to the Blockchain Council, an industry association, stablecoins include USD Coin which is pegged to the US dollar and runs on the Ethereum blockchain as well as the PayPal stablecoin, which is also pegged to the dollar. Jackson said a potential benefit of stablecoins, aside from their stability, is the ability to send and transfer money quickly.
7. Blockchain aims for faster cross-border transactions
The use of blockchain and blockchain-based tokens to reduce friction in cross-border transactions is another notable trend, Bennett said. “This is where blockchain remains used, with the idea that it would be both faster and less expensive for large cross-border transfers, which are bank to bank,” she explained.
The existence of central bank digital currencies (CBDCs), which are essentially digital money issued by a central bank, may play a role. CBDCs are increasingly recognized as transformative tools for the future of digital payments, and more than 100 countries are actively engaged in CBDC research and development, according to a June 2023 white paper from the World Economic Forum.
8. Customer experience improves
As the use of cryptocurrencies increases, there is an increasing focus on improving the customer experience, said Marc Lijour, an entrepreneur, researcher and educator as well as a member of the IEEE trade association.
One such solution is to use “wallet as a service,” Lijour said. WaaS provides a ready-to-use digital wallet that integrates with applications and platforms, making it easier for users to buy and sell cryptocurrencies and other assets on Web 3.0 platforms. He added that WaaS also facilitates the user experience by addressing key management, security and infrastructure, allowing users and organizations to use it for transactions without the additional steps these processes often require.
9. Blockchain innovation is still relevant
Like everything in the IT industry, blockchain technology is evolving as industry players bring new features, functions and innovations to life, Lijour said. For example, in addition to making blockchain more user-friendly, vendors are seeking to create interoperability between different blockchain networks. They also bring development tools to the market to facilitate their use and innovation.
“The next four years are going to be interesting, with blockchain making noise again,” Lijour said. “We’re going to see innovations and different blockchains take the next step.”
He cited several companies advancing blockchain functionality as examples of innovation. There’s JPMorgan’s Kinexys, billed as a next-generation financial infrastructure for token investments and faster cross-border payments. Lijour also highlighted Canton Network, which claims to be the first open blockchain network designed with the control and interoperability needed to power synchronized financial markets. Then there’s Quorum, which is essentially Ethereum for enterprise and touted as making blockchain affordable and scalable for organizations, and financial services company Deblock, which merges a crypto wallet with a customer’s checking account.
Carvalho said some innovators are exploring how AI and blockchain can work together.
10. Blockchain enables decentralized physical infrastructure
A notable blockchain innovation is DePIN, a decentralized physical infrastructure network. This uses blockchain to control and manage physical devices, such as computers and data storage, so people can share them and get paid for them without the need for a centralized authority or intermediary.
Carvalho said that using DePIN, consumer PCs with sufficiently powerful GPUs could come together to provide some of the intensive computing power required for ChatGPT and other services.
11. Blockchain tracks where data and information comes from
In 2020, telecommunications giant Verizon announced the launch of Full Transparency by Verizon, describing it as an open-source, blockchain-based editorial product designed to raise the bar for corporate accountability by providing an authoritative record of edits. made to the company’s public communications.
Bennett said Verizon is not alone in looking to use blockchain to prove data provenance and integrity, which she said is a much more important topic since the advent of generative AI and the need to ensure the right data is used to train GenAI models. .
Bennett also discussed interest in using blockchain to verify the authenticity of digital content, an interest driven by the proliferation of deepfakes and other falsified online content.
Jackson also cited this as a trend to watch, citing Swear as a vendor that uses blockchain to verify digital content. According to the company, its technology integrates with cameras and recording devices to map the digital “DNA” of every image, sound clip and pixel in real time, then store it on a blockchain. The result is an immutable record that traces the history and integrity of the content, the company claims.
12. Blockchain is not ready for quantum computing
Although many touted blockchain as a revolutionary technology when it first emerged, some now warn that its usefulness may be limited because it is not ready for quantum computing technology.
“Blockchain depends on encryption which we hope will be cracked by quantum computers in the future,” Jackson said, explaining that blockchain networks will need to move to post-quantum cryptography to ensure security if quantum becomes more widespread. This could be a challenge, especially for decentralized blockchain networks that lack a central authority to impose and guide such fundamental change, he added.
Mary K. Pratt is an award-winning freelance journalist focused on enterprise IT and cybersecurity management.
