Blockchain technology does not withstand evidence-based analysis of actual benefit. As a new study shows, there is a veritable gap between promise and reality when it comes to concrete applications for Distributed Ledger Technology (DLT). This is the conclusion of a study published by merltech.org on December 1.
MERL, which stands for Monitoring (Control), Evaluation (Assessment), Research (Research) and Learning (Knowledge), is an evidence-based heuristic to realistically assess the potential of technological innovations. The authors John Burg, Christine Murphy and Jean Paul Pétraud have subjected Blockchain technology to such an investigation for the first time. The authors put the technology through its paces using the MERL method. It has to be said that the results are sobering.
An evidence-based applicability cryptosoft test
What is cryptosoft? How does cryptosoft work? Where does an application make sense? The list of questions that companies should ask themselves when thinking about implementing a blockchain can be extended at will.
However, as the authors of the study “Blockchain for International Development: Using a Learning Agenda to Address Knowledge Gaps” have to state, not too many companies seem to care about such fundamental questions. Hype often triumphed over ratio.
In order to arrive at this result, the authors proceeded as follows: As an example, they identified 43 possible blockchain application cases and promises such as “cost reduction”, “data protection” and “improved security infrastructure”. According to the report, this was the simple part of the MERL test.
However, it became difficult when the authors tried to contrast the possible applications with actual implementations. To make it concrete: Burg et al. did not find a single case in which the companies could keep the promises of the white paper – as it stands now.
Although this did not mean that no product went live, the promised disruption failed to materialise in all cases investigated.
Practice what you preach
In terms of transparency, too, the authors do not give any praiseworthy testimony to the industry:
“Despite all the hypes about how Blockchain brings transparency to processes and procedures in low-confidence environments, the industry is still opaque, the report says.
Another critical consequence of this non-transparent information policy is a lack of cooperation between the blockchain companies:
“Blockchain companies that develop prototypes do not keep what they preach themselves – improving transparency – by not exchanging data and experience about what works, what doesn’t work and why.
This leads to avoidable failures repeating themselves.