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Introduction to Blockchain Business Models
Blockchain provides new business models that can transform existing models. Some key models include: - Token economies where tokens power functionality and enable value exchange within an ecosystem. Utility tokens exemplify this. - Blockchain as a service allows businesses to outsource technical blockchain aspects while focusing on front-end development. - Blockchain development platforms empower developers to build decentralized applications that require tokens to access network resources and provide value to users.
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Introduction to Blockchain Business Models
- 1. Blockchain & Business ADeep Dive into Business Architectures and Domain Models
- 2. Blockgeeks https://blockgeeks.com/guides/understand-blockchain-business-models/ 101 Blockchains https://101blockchains.com/blockchain-business-models/ Convective https://medium.com/coinmonks/blockchain-as-a-business-model-ed4de3c91763 University ofOslo https://www.duo.uio.no/bitstream/handle/10852/63896/Blockchain-business-models.pdf Enrico Ferro, Michele Osella, Ricardo Rastagana https://www.slideshare.net/s2pisco/business-models-for-blockchainbased-ventures-106439896
- 3. Defining a Business Model Abusiness model is a fancy term used to explain the plan/strategy that the company has to generate profit by selling a product or service. The business model provides an outline of the plans of the company to produce a product or service and to market it.
- 4. • Even thoughthe business model has a focal focus in the business, its boundaries goes beyond those of the firm. • Business models explain how companies do business in a holistic way. • The activities of the focal company and its partners is a central part of the business model. • In addition to value creation, business models also explain value capture.
- 5. • A businessmodel consists of three main categories of components: strategic components, customer and market components, and value creation components. • The main categories are divided into subcategories. The strategic components are strategy model, recourse model and network model. • The customer and market components consist of customer model, market offer model, and revenue model. • The value creation components consist of a manufacturing model, a procurement model and a financial model. • Although the components in the business model are presented as separate units, they should be viewed as interrelated.
- 7. • They essentiallyprovide service or goods and earn profit from there. The consumers buy the product or the service at a prescribed rate. • The rates are set accordingly and consist of all the wages or other expenses that the business have or might have during the process of providing the service or product. • Each business has a different way of handling the business. However, they use a basic centralised model. • The model consists of four main entities. It includes the owners or the shareholders, the organisation, the customers and the employees.
- 8. Understanding Blockchain A blockchain is,in the simplest of terms, a time- stamped series of immutable record of data that is managed by a cluster of computers not owned by any single entity. Each of these blocks of data (i.e. block) are secured and bound to each other using cryptographic principles (i.e. chain).
- 15. • Blockchains aretrust-less; they assume compromise by both insiders and outsiders. • Blockchains are transparently secure; they do not rely on failure-prone secrets, but rather on a cryptographic data structure that provides a secure foundation on which to add additional security protocols. • Blockchains are fault tolerant; they use algorithmic consensus mechanisms to align the efforts of honest nodes to reject those that are dishonest.
- 16. • Blockchain itselfis a new business model. • With blockchain, organizations can turn their business into decentralisation platform which can alter how their business works. • It changes the entities, the flow of transactions, profits and also ensuring that growth is maintained during the change.
- 21. • With blockchain,organisations can turn their business into decentralisation platform which can alter how their business works. • It changes the individual elements, the flow of transactions, profits, and also ensures growth. To succeed properly, these models should make sure that they are benefitting both the company’s employees and end users.
- 23. • You canstore data inside the blockchain which can’t be tampered with. • Many companies have leveraged the blockchain’s transparency to boost the functionality of their supply chains. • Many have integrated the blockchain with artificial intelligence to create their own decentralised AI model.
- 27. • As perthe theory of disruptive innovation, Blockchain partially can be considered a disruptive technology. • Further, blockchain affect all dimensions of Osterwalder ́s business model framework. • The most significant affect is blockchains ability to change the power structures between producers and users. • Blockchain enables digital ownership, and empowers its users by involving them in the value production of products and services. • The Business Model Canvas has through the study proved to be an insufficient tool for constructing blockchain business models.
- 33. Token Economy Blockchain asa Service Blockchain Development Platforms Blockchain Software Products Blockchain Network Blockchain Professional Services Blockchain P2P Business Model
- 34. • The utilitytoken model drives the functionality in their business via the use of the tokens. • Ripple and Stellar are great examples of these kinds of models. The banks who are part of their network can facilitate fund transfer via the use of the XRP or XLM tokens. • As per William Mougayar, token utility has three important properties: Role, Features, and Purpose
- 35. • Rights - •By taking possession of a particular token, the holder gets a certain amount of rights within the ecosystem. • Value Exchange - • The token creates an internal economic system within the confines of the project itself. • The tokens can help the buyers and sellers trade value within the ecosystem. • The creation and maintenance of individual, internal economies are one of the critical functions of tokens
- 36. • Toll • Tokenscan act as a toll gateway for specific functionalities of a particular system. In Golem, you need to have GNT to gain access to the benefits of the supercomputer • Function • The token can also enable the holders to enrich the user experience inside the confines of the particular environment. Brave Browser and Brave Access Tokens are examples of this.
- 37. • Currency • Tokencan be used as a store of value which can be used to conduct transactions both inside and outside the given ecosystem • Earnings • Helps in equitable distribution of profits or other related financial benefits among investors in a particular project.
- 38. A token isclassified as security when there is an expectation of profit from the effort of others. If the Initial Coin Offering doesn’t follow specific regulations, then they could be subject to penalties. However, if all the rules are properly met, then these tokens have immensely powerful use-cases.
- 39. • At itsvery essence, a security token is an investment contract which represents legal ownership of a physical or digital asset like real estate, ETFs, etc. • This ownership must be verified within the blockchain. After the ownership is verified, security token holders can: • Trade away their tokens for other assets • Use them as collateral for a loan • Store them in different wallets
- 40. • The Blockchain-as-a-Service(BaaS) model provides a service where a business’ clients can outsource all the scary backend stuff while focussing only on the frontend. • BaaS vendors provide services like user authentication, database management, remote updating, and push notifications (for mobile apps), cloud storage, and hosting.
- 41. • Blockchain ecosystemcan grow only by attracting more developers and engineers to build decentralised apps and app based economies • Developers create following type of decentralised applications • Authentication • Authorisation • Registration • Record Management • Track and Trace • Secure Storage
- 42. • This isa fundamental business model that these development platforms use. • When you create a Dapp on Ethereum, you will need to pay “gas fees” which is like a toll tax that allows you to use the platform. • In NEO you need to pay for your Dapp with GAS tokens. • This is not just applicable to the platforms, even Dapps can charge a nominal network fee. • In Golem, you need to have GNT (golem tokens) to gain access to the benefits of the Golem supercomputer.
- 56. Regulatory Sandboxes Benchmark Sandbox InteroperabilitySandbox Business Model Sandbox Scalability Sandbox Security Sandbox Infrastructure Sandbox Protocol Sandbox Governance Sandbox Permissioned Ledger Sandbox Private Chain Sandbox StartUp Ecosystem Sandbox
- 57. UK Financial AuthorityRegulatory Sandbox Canada Government Sandbox JP Morgan Blockchain Sandbox SITA Aviation Blockchain Sandbox Japan Blockchain Sandbox Brail Financial Authority Sandbox FCA Regulatory Sandbox ICAO Blockchain Sandbox
- 60. –Buckminister Fuller “You neverchange things by fighting the existing reality. To change something, build a new model that makes the existing model obsolete”