Blockchain in Business: Opportunities & Challenges

Opportunities: provenance & supply-chain transparency; asset tokenization & real-time payments; automation via smart contracts; multi-party data interoperability.

Challenges: regulatory compliance (especially MiCA in the EU), security & operations, scalability, interoperability standards, ROI.

Lessons learned: choose the right problems (multi-party data requiring immutability/auditability), start with small pilots, measure ROI, standardize operations & compliance before scaling up.

1) What do enterprises gain from blockchain?

• Supply chains & traceability: greater transparency, faster traceback, reduced fraud/recalls. (IBM Food Trust & real-world cases).

• Digital finance & asset tokenization (RWA): BlackRock’s BUIDL fund (issued on a public chain) surpassed USD 1 billion AUM in 2025; the BIS views tokenization as a pillar of next-generation monetary–financial infrastructure.

• Real-time enterprise payments: J.P. Morgan’s Kinexys network enables 24/7 multi-currency transactions, integrated with existing systems.

• Automation of multi-party processes: smart contracts reduce manual reconciliation and shorten transaction lifecycles/hand-offs.

• Sustainability: after Ethereum moved to Proof-of-Stake, energy consumption dropped by ~99.98%, easing concerns about power usage for public-chain use cases.

2) Key constraints to consider

• Legal & compliance:

  • In the EU, MiCA took effect on a 2024–2025 timeline; crypto service providers must be licensed/authorized under this framework.

  • For payment stablecoins, EU supervisors recently clarified that platforms may need additional e-money/payment-institution licensing (deadline 2026-03-02).

• Large-scale rollout risk: the TradeLens project (Maersk–IBM) shut down despite viable technology—an alert about ecosystem governance & shared-value design.

• Security & operations: contract bugs, infrastructure misconfiguration, key management, incident processes; requires testing, audits, and runtime monitoring.

• Scalability & interoperability: choose between public vs. permissioned, align data standards, and integrate with existing systems (ERP, core banking).

• ROI & organizational change: if a single party controls the data/workflow, a traditional database may be sufficient.

3) When to use (and not use) blockchain?
Use it when:

• Multiple parties (customers/suppliers/banks/partners) need to read/write shared data with immutability/auditability;

• You need asset tokenization for trading/collateral/instant settlement;

• You require inter-organizational automation with transparent logic (smart contracts).

Do not use it when:

• Data/flows are purely internal to one organization;

• You need ultra-low latency, extremely high throughput, complex logic without immutability/decentralization;

• Legal constraints make on-chain processing infeasible (e.g., sharing sensitive personal data).

4) Six-step rollout roadmap (30-60-90 days)

• Discovery (0–30 days): select 1–2 use cases with clear pain points (e.g., traceability; multi-party reconciliation; tokenized deposits/custody assets). Map the quantitative value expected (reduce T+N, mismatch rate, inventory/cost).

• Business & legal design (in parallel): data mapping, party roles, KYC/AML, off-chain vs. on-chain storage, DPIA/GDPR-like assessments, MiCA terms (if operating in the EU).

• Architecture choice:

  • Permissioned (e.g., Fabric, Corda) for consortia & sensitive data.

  • Public/L2 EVM for tokenization/liquidity & broad programmability; consider audited bridges/oracles.

• PoC (30–60 days): a small workflow with 3–5 parties; minimal API integration (ERP/OMS); standardize schemas & access rights.

• Security & operations: code review, smart-contract testing, key signing, logging/monitoring; establish the runbook & governance (upgrade rights, incident procedures).

• Expanded pilot (60–90 days): KPIs → trace time, reconciliation error rate, cost per transaction; licensing plan (if subject to MiCA/stablecoins).

5) Examples, models & references

• Supply chain: IBM describes how permissioned blockchain enables trusted data sharing; Walmart’s case shortened food trace times.

• Asset tokenization: the BUIDL fund (BlackRock) exceeded USD 1B AUM (03/2025)—a strong signal for RWA; BIS (2025) positions tokenization as a future direction for financial infrastructure.

• Enterprise payments: Kinexys (J.P. Morgan) enables near real-time multi-currency transactions integrated with existing systems.

• Technology sustainability: Ethereum PoS cut energy usage by ~99.98% post-transition—useful when opting for public chains in enterprise use cases.

• Lesson from failure: TradeLens ended operations (2022)—the issue wasn’t only technology but also participation incentives & value distribution across the ecosystem.