blockchain marketing tips One of the best pieces of advice I ever got was “always explain what you’re talking about. Never assume your audience knows the background – even if they’re experts.”

I’m especially careful to do that now around blockchain, the distributed database technology that assures the integrity of transactions or data without a central clearing house.* The hype around blockchain is so great, and the marketplaces in blockchain-based virtual currencies so hard to understand, that one billionaire investor recently called digital currencies based on blockchain “an unfounded fad.” In one story, he freely admits he is stumped by such cryptocurrencies and isn’t alone among savvy Wall Street investors puzzled by their popularity.

How’s That Again? 

To understand where we’re going wrong, check out one company’s response to the successful hacking of its peer to peer platform for initial coin offerings. These allow individual investors to help fund startups, creating a more democratic alternative to initial public offerings of stock that are usually only open to insiders or big investors.

In a July 24 post on a discussion thread, this company (which will go unnamed to protect the accused) said “We were hacked, possibly by a group. The hack seemed to be very sophisticated… the hacker(s) made away with $8.4M worth of tokens.” Doesn’t sound good, does it?

Here’s a sample of their explanation, edited for brevity. See if you can make heads or tails out of it.

“Although I hate to see assets stolen, and I hate thieves, the incident proved both the resilient demand for our tokens and the utility of the decentralized exchange…the amount stolen was miniscule (less than 00.07%) although the dollar amount was quite material.. .(the tokens stolen) are software that represent our knowledge, advisory and consulting skills, products and capabilities. Without (our) team, the tokens are literally worthless…we aren’t selling currencies, we aren’t selling securities. We are selling capabilities…We have already landed (a regional stock exchange as a client) just 30 days after the initial token offering…now you can see how inconsequential the mere hack of a few million dollars”

 Get all that? It’s reasonably clear that this company is offering tokens, on its blockchain-based platform, that customers can exchange for their consulting services. But while the dollar amount was miniscule, the dollar amount was quite material. So that means…what?

It’s Only A Few Million Dollars

The mention of the stock exchange as a customer (right after the company said “we aren’t selling securities”) is needlessly confusing. So is the rest of the post which I didn’t quote, as it goes into rambling detail about meetings they had with senior hedge funds executives who are thrilled with what they are doing. Also left unanswered is the central question: If a hacker could steal millions of dollars of worthless tokens from their platform, why should a stock exchange trust them with actual securities?

Finally, I love this sentence: “Now, you can see how inconsequential the mere hack of a few million dollars.” Not to me. The writer failed to remind readers of the essential context that no actual money was stolen – only tokens for the company’s service, which the company could disavow. A phrase like “…the mere hack of a few million dollars” is and should be a red flag for a customer or investor who is already skeptical about blockchain.

What we are left with, then, is a chasm between the enthusiasm for, and investment in, blockchain among major industry, financial and technology players such as  IBM, Bank of America and Amazon  and the skepticism that naturally results when we can’t explain what a blockchain is, what we’re using it to sell, and why a security breach on one isn’t such a big deal.

Into the breach, as always, step marketers like us. Our job is to explain complex concepts in ways that clearly show how they help the reader, viewer, or listener (for those into video or podcasts.) If we can’t do that well, we shouldn’t respond at all, as we’re only contributing to the problem.

Author: Bob Scheier
Visit Bob's Website - Email Bob
I'm a veteran IT trade press reporter and editor with a passion for clear writing that explains how technology can help businesses. To learn more about my content marketing services, email bob@scheierassociates.com or call me at 508 725-7258.

15 Ideas to Jump Start a Blockchain Blog  

blockchain blog topics

Emin Gün Sirer of Cornell University tells the MIT conference how to build blockchains right.

Let’s say you want to put a marketing stake in the ground around blockchain (networks of encrypted ledgers that automatically assure the accuracy of data and transactions without the need for a central authority.)

You’re convinced there’s real potential, but are not sure exactly where you fit in the market and how it will all play out. How do you begin building your reputation, making contacts and getting feedback and partners for your technology or business plan?

Based on sessions at the recent “Business of Blockchain” event, organized by MIT Technology Review and the MIT Media Lab, and my own blockchain marketing work, here are 15 quick hit questions you can blog about even if you’re not a blockchain expert. (Check out videos of the event here.)

Legal and Regulatory Issues

  1. What levels of assurance (if any) will central banks need before allowing the use of alternative currencies?
  2. What changes to laws and contract terms will individuals and companies need to safely rely on blockchain transactions?
  3. In the absence of banks and auditors, who will determine when a blockchain transaction has failed or when a ledger entry has been compromised?
  4. How will responsibility (legal and financial) be apportioned for the failure of blockchain transactions? Who will mediate such disputes – the courts or the parties themselves, in true “peer to peer” fashion?
  5. At what point, if any, should governments or industry groups step in to define blockchain standards and implement auditing systems?
  6. Can and should blockchain operate less like a traditional market and more like an open source project or Internet working group where many participants are motivated as much by a passion for the technology as by profit?
  7. Where should the traceability of a virtual currency stop, and who should its trail of ownership be visible to? If a bitcoin has been owned by a drug dealer or terrorist, should law enforcement have access to that information? If others can see a virtual currency’s checkered ownership history, does that reduce its value and thus make it less usable than current currencies?
  8. What is the best balance between “Big Brother” surveillance and the “Wild West” of a completely anonymous cyber- or cryptocurrency?

Technical and Implementation Issues

  1. Which are better: Permission-based blockchains that limit who may participate or permission-less blockchains open to all? The permission-based approach gives you more control, but risks creating an enterprise-specific silo that limits adoption. As with clouds, will these two flavors of blockchain merge over time? Why or why not?
  2. How many nodes on the blockchain must agree to deem a transaction or data entry valid? How might this change for different business needs? Who gets to decide which approach to use and how to determine the “voting rights” of the nodes?
  3. How do you cost-effectively develop and deploy different code for different blockchain nodes, to reduce the danger of the same vulnerability exposing all nodes to the same attack?
  4. How do you find “low hanging fruit” use cases that prove the value of blockchain in the short run (such as reduced transaction costs) to drive wider acceptance in the long run?
  5. What technical mechanisms should organizations use to prove the identity of those on the blockchain? How do you determine how much proof of identity you need for different transaction types, and with whom will you share that information?
  6. How much “scalability” and “robustness” does your blockchain require for various use cases, and how do you provide that scalability?
  7. To what extent will your blockchains need to interoperate with your legacy systems, and how will you accomplish that?

Don’t Sell. Explore Possibilities Instead

The blockchain movement is bottom up, not top down, evolving constantly with new standards, technologies and even definitions of terms. This is not “selling” to a known group of decision makers but organic, many-to-many discussion brainstorming. Be informed and have an opinion, but use your content marketing at this stage to scout for partners and build awareness of your expertise even as you seek help from others.

Finally, if you’re serious about blockchain be prepared to keep creating content for the long haul. As Amber Baldet,  blockchain program lead at  J.P. Morgan told the conference, her hope is to develop an open source community that builds a “market infrastructure for the next 20-30 years that supports the trust and robustness we need.”  That means a lot of thinking, talking, and communicating still to come.

Author: Bob Scheier
Visit Bob's Website - Email Bob
I'm a veteran IT trade press reporter and editor with a passion for clear writing that explains how technology can help businesses. To learn more about my content marketing services, email bob@scheierassociates.com or call me at 508 725-7258.

Driving Thought Leadership in Blockchain

blockchain thought leadership

Kosta Peric of thge Bill & Melinda Gates foundation describes a blockchain-based digital payment platform for the poor.

So you’re convinced of the potential of blockchain (networks of encrypted ledgers in which the nodes automatically and continually assure the accuracy of all the data on the chain without the need for a central authority.)

And you think you have some deep thinking that will help you ride the blockchain rocket. If so, what content marketing strategies will make you a blockchain thought leader?

Here are some approaches based on my own recent work on blockchain thought leadership, and from the recent “Business of Blockchain” event, organized by MIT Technology Review and the MIT Media Lab. (Videos of the event here.)

Use the “D” Word – Decentralization

The technical rebel (or rebels) who created blockchain were driven by a desire to decentralize power and authority from the centralized gatekeepers that now make the rules, handle the transactions and keep much of the money in today’s economies and societies.

For example, Uber looks like a decentralized ride-sharing service that lets drivers make money when their cars would otherwise sit unused. But the information about who needs rides and which drivers are available sits with a central authority (Uber), not the drivers or riders. And it is Uber that sets many of the rules and takes a percent of each transaction. Same with the home-sharing service Airbnb.

While blockchain since gone mainstream, with the likes of IBM offering “enterprise production ready blockchain services,” the disruptor mentality is still strong. And since blockchain is meant to be so disruptive, much of the talk at the conference was about who will be disrupted, and how.

Not all the answers are clear. Amber Baldet, blockchain program lead at J.P. Morgan, for example, cited the upside that blockchain can dramatically lower processing costs. But the downside is how blockchain could eliminate, or greatly reduce the need for entities like J.P. Morgan at all. How will this all play out? No one knows. Therein lies your thought leadership opportunity.

In your content marketing strategy, be bold in identifying  middlemen (even yourself) that are ripe for replacement through blockchain. What can or must they do to survive if blockchain replaces their “utility” function of providing safe, cheap transactions? Should they rethink who they can serve as customers, or how? Are their new value-added services they need to develop now to prepare for the loss of revenue if blockchain takes off? What will your industry look like in five or ten years if blockchain eliminates or reduces the need for today’s middlemen?

 Noodle on the Big Legal, Regulatory and Social Issues

Much of the talk at the conference was not about technology, but rather how laws and regulations will need to change if blockchain is to reach its decentralizing, empowering potential. For example, Lawrence Orsini, principal and founder of LO3 Energy, waxed poetic about the potential for local, decentralized solar powered micro-electric grids to produce greener power at lower cost. But in countries such as Germany, the rise of such renewable energy has sent traditional utilities into a nosedive as their revenues drop, while their costs stay the same for standby power plants for when renewables aren’t available, and the electric grids over which renewable producers sell their energy.

Use your industry smarts to think deeply about how blockchain could change your business, and what role regulators as well as traditional middlemen play. In the case of utilities, should regulators allow them to spin off legacy infrastructure into safe but low-return businesses that maintain power grids as a public good while putting more investment into smart grids that allow the dynamic sharing of power across markets? Why (and if so, how) should governments or regulators change how rates are sets and financial returns regulated to encourage such a shift? If a blockchain is corrupted or allows the theft of a cyber currency, who is liable for the loss? What issues should lawmakers and industry groups be tackling now?  

Think Social Good

Multiple users, and even entire sessions at the conference, were devoted to how blockchain can help the world. Ideas (and actual projects) range from delivering credit and secure transactions to the billions the billions who are now “unbanked” to low cost identity assurance programs that can widen access to government aid and even fighting human trafficking.

In some cases, the messaging spans the commercial and public realms.  Brian Behlendorf, executive director of the Hyperledger Project, an open source blockchain initiative, told the conference his  “aha” moment occurred when he learned of blockchain’s potential to securely record property claims and thus prevent the theft of land from the poor in Latin America.

 If you have a genuine social strategy, go for it in your content strategy. If you don’t, or are mixing social good with private gain, be careful. If you “greenwash” your blockchain thinking with an idealistic spin the rebel zealots in the blockchain community will delight in shredding you. Look instead for areas where your interest and society’s align, such as a utility that needs to reduce peak power generation costs while meeting greenhouse gas emission laws, and can use blockchain to do both.

The potential of blockchain is so great there’s plenty of room to think big thoughts and answer (or raise) big questions. Don’t be afraid to think big, and to focus on the vertical market and business issues you understand, not the blockchain technicalities you don’t.

What do you do when a client, or your executives, issue the trumpet call for blockchain thought leadership?

Author: Bob Scheier
Visit Bob's Website - Email Bob
I'm a veteran IT trade press reporter and editor with a passion for clear writing that explains how technology can help businesses. To learn more about my content marketing services, email bob@scheierassociates.com or call me at 508 725-7258.

Blockchain Will Be Huge. We Think.

Blockchain – the distributed ledger system meant to handle financial and other transactions without the need for banks or other central authorities – will be huge.

Those is, if dozens of players with competing agendas can solve multiple complex technical problems, and convince regulators to overturn centuries of rules in everything from finance to utilities.

That was my takeaway from this week’s “Business of Blockchain” event, organized by MIT Technology Review and the MIT Media Lab. (Videos of the event here.) (Blockchain is a network (or chain) of encrypted ledgers, in which the node hosting each copy of the ledger automatically and continually assures the accuracy of all the data and transactions on the entire chain without the need for a central authority.)

Speakers at the conference speculated that blockchain could today be where the internet was in 1990, 1985 or even 1969 –- a seemingly arcane technology poised to fundamentally change economies and societies.

But getting there is by no means certain and will require a lot of work. This post is about where blockchain is today, based on buzz at the conference and my blockchain work with clients. Follow-up posts will describe 1) tactical themes for your blockchain marketing content, and 2) more strategic questions to tackle for blockchain thought leadership.

Blockchain is Real…

Among the proof points for blockchain are:

  • UK-based Everledger uses IBM’s blockchain to prove the authenticity of 1.2 million diamonds worldwide, assuring customers they’re getting the gems they paid for and reducing counterfeiting. “Smart contracts” on the blockchain check each diamond for compliance far more quickly than previous methods.
  • Global derivatives trader CME Group is testing a blockchain-based “digital record of ownership” for ownership of gold stored in the vaults of the Royal Mint in England. This will give buyers and sellers better visibility into pricing and availability in a market that’s “screaming for disruption,” said Sandra Ro, digitization lead at CME Group. (Video of her presentation here.)
  • The Moog Aircraft Group is combining blockchain with additive printing to transmit designs for parts (and the paperwork proving the part is up to spec) to 3D printers at, say, a local airport or aircraft carrier at sea. James Regenor, business unit director for Additive Manufacturing and Innovation at Moog, told the conference this will reduce not only inventory and shipping costs, but the time required to send the documentation without which parts cannot be used. (Watch his presentation here.)

Both Ro and Amber Baldet, executive director and blockchain program lead at J.P. Morgan, pointed out the potential of blockchain to reduce transaction costs in an industry under intense cost pressure in the wake of the 2007-2008 financial crisis. IBM, a co-sponsor with Deloitte, referenced a survey showing 14 percent of its global financial services customers expect to deploy production blockchain applications this year, and said more than 400 customers are using its own IBM Blockchain.

…But Still Very Young

But even those who believe blockchain could be as revolutionary as the Internet stressed how much work is yet to be done. One described blockchain, for example, as nowhere near the “tipping point” the Web reached when HTTP (the Hypertext Transfer Protocol) put a pretty graphical interface (in the form of Web pages) on the underlying technology in the mid-1990s.

Baldet noted that while there are more than $18 billion in bitcoins (a “cryptocurrency” and payment method based on blockchain) in circulation, this is dwarfed by the $97.4 in conventional currency in circulation globally. Although bitcoin is the most widely known use of blockchain, some speakers argued over whether such cryptocurrencies are even a necessary part of blockchains. (Ro can be seen on YouTube asking whether bitcoin is a currency, a commodity, or something else altogether.)

Blockchain Busters

Even on the technical level, there are serious questions over whether blockchain can deliver. Associate professor Emin Gün Sirer of Cornell University listed the three essential promises of blockchain. They are 1) that every transaction must be valid, 2) the history of each transaction must be immutable (impossible to change) and 3) all nodes must reach a consensus on which transactions are valid.) Production blockchains have failed all three tests, he said, with software bugs allowing the creation of fraudulent bitcoins and forcing the roll back of fraudulent transactions.

One vulnerability, he told the conference, is the consensus model by which blockchain nodes continually check the validity of entries in the distributed ledger. If a hacker can take over enough nodes to force a consensus, they can block a valid transaction, or commit a fraudulent transaction. This threat is heightened, he said, because in many blockchains, the same code is used to run all the nodes, making them vulnerable to the same hack.

Yet another challenge is proving that a participant in a blockchain (whether a person or an organization) are who they claim. This was a major sticking point for conference speakers, who had trouble agreeing how to define “identity,” much less how much identity a participant might need in various cases or how to assure it.

Non-technical governance, regulatory and legal questions loomed as large, if not larger. If hackers steal a digital currency but don’t cash it in for “official” currency, has a crime been committed? Would regulators, or customers, accept a financial system where 51% of blockchain nodes could “vote” to roll back a transaction? What will it take to convince regulators that blockchains are safe replacements for today’s “middlemen” such as banks and electric utilities?

Marketing Blockchain? First Steps

All this makes an unusual challenge if you want to play in the blockchain space, but don’t have a finished product, service or business model to talk about in your marketing content.

To start, be sure you have answers to (or at least a feasible approach for) dealing with the security and other limits of blockchain, and the regulatory or governance hurdles it faces in your specific industry.

Second, as several speakers warned, don’t just use “blockchain” as a way to sell your current offerings. One example that surfaced repeatedly was database vendors disguising their wares as distributed ledgers, whether they meet the unique needs of blockchain or not. The blockchain community prides itself on being “disruptive” of existing technologies and businesses, and the true believers will be all too happy to trash tacky marketing ploys.

Finally, broaden your content marketing mindset – as many of my clients are — beyond getting leads to generating interest and involvement from potential partners, investors, regulators and governments. Getting blockchain right will take a lot of bright minds, and content that attracts them may be just what you need at this point.

How does this square with your view of blockchain acceptance in the marketplace? Are you or your clients even thinking of marketing your blockchain chops or still trying to get your mind around the concept?

Author: Bob Scheier
Visit Bob's Website - Email Bob
I'm a veteran IT trade press reporter and editor with a passion for clear writing that explains how technology can help businesses. To learn more about my content marketing services, email bob@scheierassociates.com or call me at 508 725-7258.