The newest cry in the cryptocurrency clamour? That of heritage-photography-giant-cum-new-kid-on-the-payments-block, Kodak. Unbelievably, they have managed to out-blockchain the long-island-iced-tea company in their audacity, and (more than) double their share price to boot.
I believe this particular announcement is what is known as a ‘pivot,’ but perhaps might be more of a 360-twist given that a ‘Kodak moment’ started out as a moment worth adding to the family album, became synonymous with missing the boat on technology revolutions, and most recently has been ‘coined’ in the payments sphere in relation to banks at risk in the blockchain revolution.
Even though the Kodak press-release is suspiciously light on details, this is perhaps not as bonkers a move as it first appears. Distributed ledger technology was designed to track assets, and valuable images and digital rights management seems a natural fit. Bearing this in mind, these are my top recommendations for anyone wanting to jump on the blockchain bandwagon and create their own crypto proposition.
Photographs have transitioned from physical output to digital representations, without ever losing their tangible presence – or associated value. In fact, in a digital age with improved capture and editing technology, better global distribution platforms, higher resolution viewing mechanisms, and the ability to educate oneself on the arts, this should all add up to increasing value for the artists who produce the content. The issue continues to be finding a way to combine blockchain with effective implementation of copyright law, to ensure that artists are remunerated for all reproductions of their output.
- Personal Identity
In the age of open banking, the individual is going to become far more conscious of the digital ‘spread’ of their personal identity. Modern fraudsters are not interested in your hard cash – they are interested in how they can wield your identity to gain access to a much larger credit pool, which they can turn into far more of the cold stuff. As individuals, we are also wary about a Minority Report state, where our personal identity is managed by the authorities. What’s needed is an innovative solution where consumers can maintain control over their identity, status and entitlements so that only those with genuine approval can make appropriate enquiries. If done properly, society benefits – not just Big Brother and Big Business.
- Designer Goods
Louis Vuitton employs a team specifically to manage the protection of the company’s intellectual property and rights. Why? Because counterfeit swag is essentially stealing the intellectual property of the designer in the same way as reproducing imagery without purchasing it. However, the likelihood is that the person who purchases their fake Fendi on a market stall was never going to buy a real one anyway. The value of designer goods lies in the high-end customer knowing for certain that they have the real thing. This is where distributed ledger technology comes in. Sneaker heads will spend $60,000 on a pair of self-lacing Back to the Future Nike high tops if they can guarantee that they are the real thing, and that they are rare. A distributed ledger could do both of these things; ensuring that the identity of the purchased bag appears on the bag-blockchain, and only once.
- Fine wine
The value of fine wine has now withstood two US recessions, and even outperformed a benchmark shares index for 13 years, making it a market that justifies the investment. It’s another asset class whose value derives from a combination of authenticity and rarity. On top of this, without ledger, the verification of its authenticity might necessitate uncorking the bottle – which would immediately destroy its value. Verification via distributed ledger is both practical and prudent. Again, does the unique bottle appear on the ledger? And if so, where is it according to connoisseurs’ consensus?
- Event ticketing
We’ve all seen our dream concert sell out before we could ‘add to basket,’ or secure tickets for our friends (only for them to bail post-purchase). In both scenarios, we want a safe, secure and legal way to purchase a ticket, or offload our extras. But how to know if the ticket is real? Or from the event organiser’s point of view, how can they know that people are purchasing tickets for themselves and not to tout on the black market? A properly traceable transaction associated with the tickets would make regulating touts much easier, and ensure real fans get to the shows. This may have been a problem in the era of physical, paper tickets, but mobile apps now make this a practical scenario. If only more promoters were willing to play straight rather than prolonging murky market practices.
- Food standards, safety and traceability
The European horse meat scandal hit headlines hard, and was clear evidence of a previously hidden issue; food fraud. According to the ‘Distributed Ledger Technologies for Public and Private Good: leadership, collaboration and innovation’ report published in the UK House of Lords in November 2017, the UK is already at the forefront of countering food fraud in collaboration with the US, European Union and China. But as the food supply chain is highly fragmented, there are challenges in creating practical databases for accountability and traceability. However, given that the traders convicted over the pony patties increased their profits by 30-40% by supplementing cheap beef with even cheaper equine cuts, it’s easy to see why fraudsters would be tempted. It’s not just about fraud – Westminster City Council in London took local restaurants to court over the correct hygiene and safety standards needed to serve a rare beef burger. The restaurant eventually won because it could prove its supplier and processes were fit for a Queen (or the Queen actually), but it raises interesting points around proving more than just the provenance of ingredients in the food production and consumption chain.
The fact remains that successful real-world applications for blockchain are still a rarity. Beyond Bitcoin, few examples like Ripple’s SWIFT challenger have yet to materialise. But perhaps payments businesses should be taking a leaf out of Kodak’s shutter and endeavor to realize more use cases – that’s if they want to avoid their own ‘moment.’