Adoption of Blockchain Technology

Blockchain is a digitized decentralized ledger to allow record keeping of all peer-peer transactions without the need for a centralized authority. Cryptocurrency is enabled through Blockchain technology (Woodside, Augustine & Gibberson, 2017).

Theoretical Underpinning on Adoption of an Innovation

The Unified Theory of Acceptance and Use of Technology (UTAUT) model presents four main effects for end intention and usage which are performance expectancy, effort expectancy, social influence, and facilitating conditions. Trust is a key element of Blockchain technology for the innovation’s adoption (Francisco & Swanson, 2018).

Further, the Diffusion of Innovations Theory explains how an idea, product, or service is adopted through a system over time. This adoption of innovation occurs at different rates within people, ranging from early innovators to late laggards (Woodside, Augustine & Gibberson, 2017).

Benefits of Blockchain Technology

Blockchain has the potential to replace central banking platforms and other use cases including business process improvement, trades, health information sharing, automotive ownership, and voting. Early applications proved that Bitcoin could be used as a legitimate currency in the marketplace. (Woodside, Augustine & Gibberson, 2017). In addition, there is the hypothesis that Bitcoin provides a distinct advantage to populations living in underdeveloped and struggling economies since it solves the problems of hyperinflation, exchange, counterfeiting, and inaccessibility (Presthus & O’Malley, 2017). Other benefits include: public Blockchains are viewable by all participants and cannot be altered, allowing trust of transactions without a required regulatory party; Blockchain has the ability to automate a number of existing functions, and lowers transaction costs and improves completion time by removing the need for third-party intermediary transaction fees; ability to monitor transactions in a single location;  decentralized reliability, durability and security, no centralized server or single point of failure, and greater protection against fraudulent transactions (Woodside, Augustine & Gibberson, 2017).

The Barriers to Blockchain Technology

Notable barriers include: currencies have traditionally been regulated by national governments yet international rates may vary; currency fluctuations have impacted value of market and are susceptible to market shocks; publicized concerns of transaction privacy and security incidents limit user adoption; resolution of speed, processing time, security and privacy concerns, and integration within existing systems and networks may also present challenges (Woodside, Augustine & Gibberson, 2017).

Tsanidis et al. pointed out that potential users lack information about Bitcoin, such as usefulness, ease of use, and possible benefits like saving time and money. They propose three factors that might hinder the adoption of Bitcoin; lack of infrastructure, potential problems with the Bitcoin network itself, and fear of the unknown (Presthus & O’Malley, 2017). Another obstacle to user adoption may be lock-in or switching cost, meaning the time, money and effort it requires starting using a new technology or innovation. Further, Blockchain has the potential to become a significant source of disruptive innovations in business and management (White,2017).

Peansupap & Walker (2006), provide insights into what drives and inhibits effective ICT innovation diffusion at the organizational level hence advise that organizations should closely manage their ICT initiative decision making and implementation using pilot studies and a reflective learning approach to maximize advantages from lessons learned.

Methodology

Previous methodologies employed in Blockchain studies include Text analytics, a method used to find and extract useful patterns, directions, trends or rules from unstructured text (Woodside, Augustine & Gibberson, 2017) and Triangulation, which combines multiple methodologies, such as qualitative and quantitative methods (Woodside, Augustine & Gibberson, 2017). White (2017) posits that Delphi studies, which are frequently employed in deductive research, may be combined with qualitative data-capturing elements in order to afford more pragmatic instrumentalization. The best sampling techniques were non-probabilistic where instances were deliberately selected. Descriptive statistics were also used (Presthus & O’Malley, 2018).

References

Francisco, K., & Swanson, D. (2018). The Supply Chain Has No Clothes: Technology Adoption of Block chain for Supply Chain Transparency. Logistics, 2(1), 2.

Peansupap, V., & Walker, D. H. (2006). Information communication technology (ICT) implementation constraints: A construction industry perspective. Engineering, construction and architectural management, 13(4), 364-379.

Presthus, W., & O’Malley, N. O. (2017). Motivations and Barriers for End-User Adoption of Bitcoin as Digital Currency. Procedia Computer Science, 121, 89-97.

White, G. R. (2017). Future applications of block chain in business and management: A Delphi Study. Strategic Change, 26(5), 439-451.

Woodside, J. M., Augustine Jr, F. K., & Giberson, W. (2017). Block chain Technology Adoption Status and Strategies. Journal of International Technology and Information Management, 26(2), 65-93.