The US Treasury Department has published five tips for companies implementing blockchain technology.
The tips, which was drafted by the Treasury’s Bureau of the Fiscal Service (BFS), are based on lessons learned by the department while building its own blockchain proof of concept. The department’s blockchain pilot program began in October 2017 and sought to utilize blockchain systems to track physical assets such as computers and smartphones
The Treasury advised companies to cut through the hype surrounding blockchain technology and honestly consider whether a the technology will add value to their operations. The department provided five questions which could help firms determine when to use the blockchain.
- Do you need a structured central repository of information?
- Is more than one entity reading or writing transactions to a database?
- Is there less than total trust between parties/entities in the ecosystem (for example, one user will not accept the “truth” as reported by another user)?
- Are central gatekeepers introducing costs and /or “friction” when verifying transactions (for example, manual verification)?
- Are there routine or logical interactions that occur that could be programmed to self-execute (for example, smart contracts)?
The department said that if the answer to several of those questions is yes, a blockchain solution may be worth considering. The next step could be interviewing a variety of different stakeholders to understand their pain points.
“Documenting these pain points (and good points) will help in developing user stories that will be used to build your blockchain application,” the treasury said. “Missing an important perspective early on could cause delays and re-work during the blockchain design and development phase.”
The bureau also said that putting together the right project team is important. Having representatives from across program offices and especially your IT shop can help in developing a better, more robust blockchain application.
“Include both blockchain skeptics and non-technical people,” the treasury said. “A team comprised of only pro-blockchain people can be blinded by the hype and force a square peg into a round hole. Putting blockchain technology through a gauntlet to see if it reaches the other side is the best thing we can do to understand its usefulness.”
The advice concludes by recommending entrepreneurs to set a time frame dedicated to basic discussions regarding the fundamentals of blockchain technology so that everyone from the team, including lawyers and investors, may gain a firm grasp of the concept.
“There is no way to sugar coat it – agency governance processes can be time consuming,” the bureau said. “But preparing for and presenting your project in front of your investment review and technical review boards can bring to light perspectives or issues you haven’t considered. Building enough time into your project plan to present and explain blockchain technology in clear, easy-to-understand terms will help you plan for, and move through the process swiftly.
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