The onset of “blockchain fatigue”
A Google Trends analysis shows worldwide interest for “blockchain” emerged in 2013, and began to grow in earnest in early 2016. It peaked at the end of 2017. Interest has since fallen back to early-2017 levels.
Outside of real estate, mass implementation of blockchain across supply chains has struggled to live up to the initial enthusiasm. A Gartner survey labelled this “blockchain fatigue,” citing immature technology, lack of standards and overly ambitious scope as contributing factors.
Even moving land registries online and setting up contracting systems is a major logistical challenge that relies on multiple markets having robust regulatory frameworks in place.
“For blockchain to be adopted more widely, you need three things: the computing power to run it, legislative frameworks to police it, and a practical workaround for immutability,” McAuley says.
One of blockchains’ major drawbacks is its permanence – actions cannot be undone and remain forever etched into the system.
“Anything involving humans will never be error free,” McAuley says. “But with blockchain it becomes more difficult to enforce regulatory oversight or legal judgements.”
Keeping the systems that rely on blockchain free of fraud and error – human or otherwise – has deterred the industry.
“I find it difficult to believe blockchain will be as used, or as useful, in real estate as was thought initially,” McAuley says.
That said, efforts continue undeterred. COVID-19 could go some way to accelerating blockchain initiatives as the imperative for faster, remote transactions increases.
But the industry will continue to approach the technology with caution as it develops over the years ahead.
“The potential is still there,” McAuley says. “But so are the challenges.”