Category Archives: Blockchain study

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New Zealand Research Suggests Economy Can Benefit from Blockchain Enterprise

New Zealand Research Suggests Economy Can Benefit from Blockchain Enterprise

A new report suggests that New Zealand’s third-largest export sector and high-tech workforce could benefit significantly from blockchain technologies.

Economic benefits

The report titled Distributed Ledgers and Blockchains: Opportunities for Aotearoa New Zealand was published by Callaghan Innovation, a state agency dedicated to innovation and research and development of “ambitious businesses of all sizes”.

In it, the agency has thoroughly examined blockchain technologies and concluded that the nation’s IT sector, which presently rakes in NZD 16 billion a year with a workforce of almost 100,000, could grow to become the “second biggest contributor to gross domestic product by 2025” should blockchain be adopted sooner than later.

Examining the present state of the nascent sector, the report reflects on the USD 20 billion raised through initial coin offerings (ICOs) since 2017, which it views as a massive opportunity for “startups, researchers and established businesses”. However, for New Zealand, companies who utilize crypto-tokens through either ICOs or operating cryptocurrency exchanges have struggled due to banking restrictions, as per the report, “urgent action is required to unblock access to basic financial services”.

It is not a biased report; it acknowledges the numerous challenges within the nascent sector, namely “new consensus mechanisms to address scalability and energy efficiency, stable coins to address volatility, or data analytics to detect and prevent criminals from laundering money on public blockchains”. That said, the report goes on to identify how this landscape is changing in order to overcome these hurdles. It does so by highlighting several projects that are underway to address these problems.

Workforce matters

According to a blog post from Callaghan Innovation, the report’s research was partially funded by the Ministry of Business Innovation and Employment (MBIE) and was produced to promote the technology amongst domestic entrepreneurs and innovators.

Offering his thoughts on the report, Andy Higgs, General Manager of Strategic Partnerships at Centrality said: “Blockchain presents a huge opportunity, with over USD 11 billion raised through initial coin offerings (ICOs) in the first half of 2018. New Zealand has a chance to lead the way, thanks to our sense of fairness and social inclusiveness, to ensure all New Zealanders benefit from the full potential of blockchain and decentralization.”

With the inherently international nature of the blockchain industry, the study says that a blockchain company doesn’t have to be based in New Zealand to be able to provide work for New Zealanders. From this, it suggests that instead, it matters more where the “key personnel” are located within a distributed workforce, and should drive New Zealand to foster a world-leading workforce.

 

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KPMG Study Reveals 2018 Blockchain Investment Has Already Outgunned 2017 Total

A KPMG study finds that fintech companies’ investment in blockchain technology in 2018 has already surpassed the entirety of 2017.

Capital growth

The Pulse of Fintech 2018‘ biannual study from one of the Big Four auditing and consultancy firms took a global look at the growth of fintech investments, which in the first six months of 2018 has broken past 2017 in spectacular fashion.

The study affirms that blockchain is “moving beyond experimentation”, noting that a majority of Q1 and Q2 investors in 2018 gravitated more toward established companies and organizations moving into “additional rounds of funding”. This is contrasting to 2017 which saw significant amounts of investment in startups, especially through initial coin offerings.

Venture capitalist blockchain investment so far this year has reached USD 858 million, more than 2017’s USD 631 million. These figures are bolstered by two enormous funding rounds: Circle, which raised USD 110 million and  Ledger cryptocurrency wallet, which recently raised USD 77 million.

Safwan Zaheer, Financial Services Digital & US Fintech lead for KPMG said, “There’s more VC flow available than opportunities to invest – a sign of tremendous growth in the space… Investments in blockchain related firms already doubled in the first half of 2018 compared to 2017. Blockchain has the potential to transform banking services. If banking systems were to be rewritten today they would be based on blockchain.”

The study acknowledges the versatile list of applications for blockchain technologies, which is a contributor to its growing success, especially within the financial sector. KPMG cites banking and insurance as two of the primary uses of the technology but also explains that blockchain can “enhance processes for any number of US and global businesses.”

Initial coin offerings

With regards to ICOs, the modern crowdfunding method has also seen a sharp rise, outpacing that of 2017. A similar June report released by another of the Big Four, PwC, found that a total of 537 ICOs in the first five months of 2018 have raised more than every ICO prior to 2018, with a total volume of USD 13.7 billion.

Again, a part-cause for the ICO figure exploding in 2018 is down to the EOS ICO which lasted for a whole year, raking in a record USD 4 billion, beating the previous record of Telegram’s controversial USD 1.7 billion ICO.

The Big Four have been looking at the growing industry with a piqued curiosity; in April 2018, it was reported that the firms were receiving daily enquiries into ICOs and cryptocurrencies from clients.

 

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