Although cryptocurrencies have brought blockchain technology worldwide recognition, new enterprise and consumer use cases are emerging.
And in 2024, more enterprises will adopt blockchain to improve transaction security, transparency, and protection from cyberattacks, says Matt Moynahan, CEO and president of OneSpan, a digital agreements security company.
“That’s especially true as more high-value business transactions are conducted online and personally identifiable information is under attack,” he says.
“The use of blockchain to provide immutable audit logs and a powerful chain of custody has now reached a level of maturity that’s the new gold standard for data integrity.”
The global blockchain market is estimated to be $8.89 billion in 2023, and it’s expected to reach $2,334.46 billion by 2032, driven by the “increase in venture capital and investment in blockchain technology; widespread use of blockchain solutions in banking and cybersecurity; strong adoption of blockchain solutions for smart contracts, payments, and digital identities; and increased government initiatives,” according to a report from Precedence Research.
So what blockchain trends does our panel foresee for the future?
6 Top Blockchain Trends for 2024
6. Blockchain Will Be a Key, Complementary Tech for Generative AI
While 2023 was a year for proof-of-concept development, blockchain will enter its execution phase in 2024 – a period of commercial deployments across industries, led, in part, by artificial intelligence (AI), says Mrinal Manohar, CEO of Casper Labs.
Despite generative AI‘s potential, it’s hindered by a “black box” problem – understanding and correcting the root of AI hallucinations is prohibitively difficult, he says. Blockchain offers the most cost-effective and tamper-proof way to inject visibility and unlock version control in AI systems.
“As more businesses understand blockchain’s value in 2024, it will emerge as the critical guardrail that AI systems have been lacking to date, enabling more responsible AI standards and innovation,” Manohar says.
5. Increased Investment by the Financial Services Industry
The decentralized, secure nature of blockchain has already made it increasingly popular in the finance industry – most notably with cryptocurrency as a speculative asset, says Lindsey Argalas, CEO of TaxBit, a tax and accounting compliance solution provider.
“However, with the emergence of tokenization of real-world assets, decentralized finance, and potential centralized bank digital currencies, blockchain’s role in the global financial landscape will increase dramatically,” she says.
Financial services are going to evolve significantly over the next decade, including the convergence of traditional and digital assets, according to Argalas.
“While this will take time, when you see the potential of blockchain – particularly with how it can move money across borders in real-time, more efficiently – it’s understandable why the financial services industry is investing in this technology,” she explains.
“Near-term applications of blockchain include streamlining wholesale settlement, liquidity management, creation and distribution of tokenized assets, and more.”
4. Enhanced Regulatory Clarity
Technology moves faster than regulation, and banks and regulators must be able to collaborate more quickly and innovate for the technology to succeed, thrive, and benefit real people, says Anthony Moro, CEO of Provenance Blockchain Foundation, which is responsible for the Provenance Blockchain, a Layer 1 blockchain purpose-built for financial services.
“2024 will be a period in which regulators gain more familiarity with innovations being developed on-chain and increase participation in experiments and discussion,” he says.
In addition, private, permissioned environments are also poised to help streamline banks’ internal operations, including cross-border payments and settlements, according to Moro.
They offer a potential solution for banks and financial institutions to participate in the evolving digital economy while adhering to regulatory requirements and maintaining a level of control over their own products and processes.
“Banks and even regulators can use permissioned blockchain zones as ‘sandboxes’ to test out new financial products and services in a controlled and safe environment, which ultimately minimizes risks and stays within the confines of existing regulations,” Moro says.
READ MORE: Top Crypto Trends to Look Out for in 2024
To unlock the full potential of blockchain, increased regulatory clarity is critical, says Argalas.
“We see many companies investing in crypto-tokenized assets and various blockchain-related initiatives, but they are hesitant to bring them to market due to regulatory uncertainty,” she says.
Governments around the world are already working toward comprehensive regulatory frameworks, Argalas adds.
“We’re encouraged by pockets of increased clarity, such as the recently-proposed digital asset tax regulations in the U.S. and at the global scale with the Organization for Economic Co-operation and Development’s Crypto-Asset Reporting Framework, among others,” she says.
“As regulatory guidance is further clarified, we expect more development of innovative applications using blockchain technology in key markets.”
3. Better Supply Chain Management
Supply chains across all industries are undergoing digital transformative efforts to become more efficient, increase visibility, and ultimately be able to share/access accurate data at any given time.
Blockchain can certainly be a viable option to do so, according to Bob Czechowicz, senior director, innovation at GS1 US, a not-for-profit organization that aims to improve supply chain visibility and efficiency through GS1 standards.
READ MORE: Supply Chain and the Blockchain
“Recently, a seafood industry pilot we conducted highlighted how standards for product identification and data communication can help the industry achieve interoperability while leveraging blockchain to optimize data sharing,” he says.
As blockchain’s full potential continues to be realized, data standards like those from GS1, will be crucial to help ensure all trading partners are sharing information in a consistent and accurate manner, according to Czechowicz.
“Blockchain may be the solution to provide a transparent, immutable ledger of product movement through the supply chain,” he adds.
In 2024, there will be standards and regulatory requirements to monitor blockchain governance and operations globally, including in various product supply chain flows, says Joseph Sarkis, professor of management at The Business School at Worcester Polytechnic Institute.
“There will be greater adoption by various [supply chain’ stakeholders’ initiatives, e.g., tracing of the safety of products from raw material extraction to use and disposal,” he says.
Currently, the main trend of blockchain application in supply chain management is centered around enhancing digital networks, optimizing traceability, reducing losses, and improving administrative efficiencies, says Sara Saberi, assistant professor of operations and industrial engineering at The Business School at Worcester Polytechnic Institute.
“Looking to the future, when AI is prevalent in every aspect of our life (this is what I really expect), blockchain applications in supply chain management are expected to integrate AI to further enhance their capabilities,” she notes.
AI can process large amounts of data generated and stored on the blockchain, automating analysis for real-time insights into supply chain operations, according to Saberi.
This integration can help identify bottlenecks, optimize processes, ensure regulatory compliance, enhance transparency, and automate operations, thereby increasing efficiency.
“AI can also bolster supply chain security with tools to detect and prevent fraud and other malicious activities by analyzing transaction data and enabling accurate and error-free data integration into blockchain through the utilization of Internet of Things devices,” she says.
2. Blockchain Use in Telecommunications
Blockchain technology is now finding key niche use cases outside of decentralized finance and cryptocurrency, says Michael Bordash, senior vice president of research and development at telecommunications company Syniverse. For example, in the telecommunications industry blockchain can be used for clearing and settlement processes.
“Blockchain use in telecoms for clearing and settlement will continue to grow in 2024 as operators, large and small, seek to verify and bill for mobile roaming transactions while also spotting usage anomalies that indicate fraud, i.e., the use of visitor network data/services without payment,” he says.
However, this use case will be limited by the speed at which the telco/operator implements the components required to enable blockchain-based clearing and settlement services, including a ledger node deployed within a private blockchain network, according to Bordash.
“There is also the effort to shift from other batch-based clearing and settlement services,” he says. “In 2024, larger operators will also make significant efforts to modernize their older clearing and settlement platforms with blockchain-based ledger technology.”
1. Current Crypto Winter to Continue
Murat Kantarcioglu, an Ashbel Smith professor of computer science at the University of Texas at Dallas, predicts that the crypto winter, particularly in the context of non-DeFi applications, will likely continue for some time.
“Despite the rising prices of crypto assets fueled by expectations of a Federal Reserve interest rate cut and the potential popularity of crypto asset ETFs [exchange-traded funds], I remain skeptical about the sustainability of this upward trend,” he says.
The lack of widespread adoption of DeFi applications and cryptocurrencies, combined with significant price volatility, has dampened enthusiasm among regular investors, according to Kantarcioglu. Consequently, the substantial investments required to further drive up crypto asset prices may not materialize in the near term.
“Recently, several early blockchain applications, particularly those outside of DeFi, e.g., supply chains, have been either canceled or gradually phased out,” he says. “However, recent concerns around AI trustworthiness and the proliferation of deep fakes could spur the development of new blockchain applications.”
These new blockchain applications would primarily focus on tracking the provenance of models and data, aiming to mitigate the spread of deep fakes and false information, he says.
“For instance, once a photo is captured by a camera, it could be recorded on a blockchain and subsequently, all interactions with the image, such as access and modifications, can be cryptographically secured,” he explains.
“When this photo is shared publicly, such as in an online newspaper, the blockchain’s provenance trail can be used to verify its authenticity and integrity.”
In the new year, more industries will likely adopt blockchain technology to increase transparency, ensure security, and improve collaboration, says Josh Schwartz-Dodek, CTO at Sojo Industries, an industrial automation company.
“However, for this to become a reality, education about the benefits of blockchain technology must become a top priority,” he says.
“A lack of understanding hinders the adoption of blockchain-powered systems.”
But just like the GenAI revolution of 2023, blockchain will also see a boost in attention and implementation once organizations become more aware of its true potential to improve tracking and traceability, he adds.
“With companies in need of complete visibility into their operations, blockchain technology can allow real-time data-sharing between multiple stakeholders in a protected environment,” Schwartz-Dodek says.
“This will improve information security while powering more informed decision-making. It will be a critical tool in companies’ technology portfolios as they move to be compliant with upcoming federal regulations.”