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Seize The Day: Public

Blockchain Is On The Horizon
Examine The Limitations Of Private Blockchain And Benefits Of Public
Blockchain To Make The Most Of This Technology Opportunity

Get started

FORRESTER OPPORTUNITY SNAPSHOT: A CUSTOM STUDY COMMISSIONED BY EY | NOVEMBER 2019

 SEIZE THE DAY: PUBLIC BLOCKCHAIN IS ON THE HORIZON 2

Consider Public Blockchain To Escape Key Findings

Overview

The Limitations Of Private Networks

Though most firms are currently leveraging
Although the technology is still in its early stages, organizations
private blockchain, there is growing interest
Situation

have already started to plan for, pilot, and implement blockchain.

in public blockchain: 75% of respondents are
To date, enterprises have almost exclusively chosen to work with
likely to use public blockchain in the future.
private/permissioned blockchains, a choice driven largely by fear
of public blockchain networks.1 And this fear is often due to a lack
Firms may be trying to force the technology
Approach

of understanding of how public blockchain networks operate. But

as private blockchain projects get underway, firms are quickly to do things it was never intended to do.
discovering their limitations. This is especially prominent with privacy and
confidentiality concerns.
In August 2019, EY commissioned Forrester Consulting to conduct
Opportunity

three interviews and survey 233 decision makers in the US, Europe,
and Asia to explore firms’ impressions and experiences with Interoperability is a key concern for private
blockchain technology broadly and public blockchain specifically. blockchain, which is exacerbated when firms
start their own private networks. Leveraging a
public blockchain could ease this problem.
Conclusion

FORRESTER OPPORTUNITY SNAPSHOT: A CUSTOM STUDY COMMISSIONED BY EY | NOVEMBER 2019

 SEIZE THE DAY: PUBLIC BLOCKCHAIN IS ON THE HORIZON 3
“What are the key drivers causing your
organization to consider blockchain generally?”
Data Integrity Preservation And
Overview

Rank 1 Rank 2 Rank 3

New Business Model Creation
Drive Blockchain Use
Preservation of data integrity 23% 16% 17% 56%
Situation

Why leverage blockchain? Most often, firms consider blockchain

Ability to build new
because of a desire to improve their business, rather than a need to 21% 15% 16% 52%
revenue/business models
keep up with competitors or pressure from their peers. Specifically,
the need to preserve data integrity and the ability to build new Increased operational
Approach

15% 18% 17% 50%

revenue or business models are the top drivers for more than half efficiency
of all respondents. Additional factors include the desire to increase
operational efficiency and reduce costs. Reduced costs 14% 15% 15% 44%

Pressure to join a network started by another company, however,

Opportunity

is not a key driver. This, as we’ll see, may be part of the reason Increased transparency 15% 15% 8% 38%
most firms are starting their own networks, which, in turn, leads to
interoperability issues down the line. Pressure to match competitors
6% 12% 16% 34%
adopting blockchain
Conclusion

Pressure to join a blockchain

network started by another 6% 9% 10% 25%
company or consortium in
our ecosystem
FORRESTER OPPORTUNITY SNAPSHOT: A CUSTOM STUDY COMMISSIONED BY EY | NOVEMBER 2019 Base: 212 director+ blockchain decision makers in the US, Germany, France, Singapore, and Hong Kong
Source: A commissioned study conducted by Forrester Consulting on behalf of EY, September 2019
 SEIZE THE DAY: PUBLIC BLOCKCHAIN IS ON THE HORIZON 4

Most Today’s blockchain projects are predominantly private: Every respondent in our study was at least interested
Overview

in private or permissioned blockchains. But despite this widespread interest, private blockchain projects are
Blockchains
still largely in their planning stages: 66% are planning to implement within the next 24 months, and only 24%
Today Are have already implemented. And of these respondents, about two-thirds say their firms have chosen to start
Private, But their own networks rather than participating in networks that already exist.
Situation

Public Is On Although private blockchains are popular currently, there is considerable interest in public blockchain
The Rise networks. Forty-one percent of respondents are interested with no definite plans, and another 35% are
actively planning to implement within the next two years.
Approach

“What are your organization’s plans when it comes to blockchain?” “Which of the following best describes
Opportunity

your current blockchain network?”

Unfamiliar with Not interested Interested but no plans to
the technology implement We started our 67%
Planning to implement Implemented/Implemented, Expanding or upgrading own network
in the next 24 months not expanding/upgrading implementation
We are a participant in 31%
Conclusion

Private/permissioned blockchains 9% 66% 9% 15% another network

3% 3%
We are a member 1%
Public blockchain networks 14% 41% 35% 3% of a consortium

FORRESTER OPPORTUNITY SNAPSHOT: A CUSTOM STUDY COMMISSIONED BY EY | NOVEMBER 2019 Base: 233 director+ blockchain decision makers in the US, Germany, France, Singapore, and Hong Kong
Note: Percentages may not total 100 because of rounding.
Source: A commissioned study conducted by Forrester Consulting on behalf of EY, September 2019
 SEIZE THE DAY: PUBLIC BLOCKCHAIN IS ON THE HORIZON 5
Top Blockchain Use Cases

Top Use Cases Align To Top Drivers

Overview

Data integrity (64%)

Considering that preservation of data integrity was the No. 1 driver
of blockchain adoption, it’s unsurprising that the most common use
case for blockchain is also data integrity. Other top use cases also Supply chain track-and-trace (55%)
Situation

align to goals. About half of all respondents prioritize use cases

that would improve efficiencies and enable new revenue models Payment support processes (52%)
like supply chain track-and-trace, payment support processes, and
digitization of document flows.
Approach

Digitization of document flows (47%)

Revenue distribution (39%)

Opportunity

Trading (33%)

Tokenization of assets (33%)

Conclusion

Trade finance (32%)

FORRESTER OPPORTUNITY SNAPSHOT: A CUSTOM STUDY COMMISSIONED BY EY | NOVEMBER 2019 Base: 212 director+ blockchain decision makers in the US, Germany, France, Singapore, and Hong Kong
Note: Not all responses shown.
Source: A commissioned study conducted by Forrester Consulting on behalf of EY, September 2019
 SEIZE THE DAY: PUBLIC BLOCKCHAIN IS ON THE HORIZON 6
Top Blockchain Concerns

Security And Privacy Are Key Concerns . . .

Overview

Security concerns (49%)

When leveraging blockchain, firms are rightly most concerned
with privacy and security. Challenges around authentication,
Situation

permissioning, and access management are critical to security. Personal data privacy concerns (46%)
But misconceptions — like the horror stories around Bitcoin theft
— also lead people to think there’s a security issue with public
blockchains in general. In reality, those and other cryptocurrency Concerns about interoperability with
other blockchain networks (45%)
Approach

breaches are at wallet or exchange level; that is, not the blockchain
itself, but the on and off ramps.
Top Public Blockchain Concerns
Privacy, however, is an inherent key challenge. By default, any
on-chain data is visible to all who have access to the chain; for
Opportunity

public blockchains, that’s everyone. But even private chains have Lack of technology maturity (58%)
commercial confidentiality considerations that call for solutions that
support selective access and viewing rights. This goes against a
purist’s view of how a blockchain should be architected, but it is Security concerns (53%)
vital for any blockchain-based network to thrive.2
Conclusion

Personal data privacy

concerns (50%)

FORRESTER OPPORTUNITY SNAPSHOT: A CUSTOM STUDY COMMISSIONED BY EY | NOVEMBER 2019 Base: 212 director+ blockchain decision makers in the US, Germany, France, Singapore, and Hong Kong
Source: A commissioned study conducted by Forrester Consulting on behalf of EY, September 2019
 SEIZE THE DAY: PUBLIC BLOCKCHAIN IS ON THE HORIZON 7

. . . But Firms While it’s an important rule of thumb with any new technology, it’s critical with blockchain: Don’t
Overview

try to make the tool do something it doesn’t want — or wasn’t designed — to do. Business
Must Start
concerns about privacy and confidentiality are all valid, but they must be viewed and assessed
Thinking Of in the context of what a blockchain was designed to do. As one respondent said: “Blockchains
Blockchain In don’t want to compartmentalize things. It’s not what they’re there for.” Firms must rethink what
Situation

a New Way they’re putting on their blockchains to have the technology work with rather than against them.
Approach
Opportunity

“[Firms] get educated by the private blockchain companies. “Try to get a blockchain system . . . to have good
Then, they’ll go to the public blockchain companies . . . compartmentalization. Basically you wind up
and they’ll try to adapt the same model and framework. If twisting it into a pretzel because it’s not what the
you come to a public blockchain from a private blockchain technology wants to do. Blockchains don’t want to
lens, then you’re going to expect very high throughput and compartmentalize things. It’s not what they’re there
think that the public blockchain is broken.” for. So how do we use a blockchain?”
Conclusion

CEO, SECURITY TOKEN PLATFORM PRODUCT EXECUTIVE, BLOCKCHAIN TECHNOLOGY COMPANY

FORRESTER OPPORTUNITY SNAPSHOT: A CUSTOM STUDY COMMISSIONED BY EY | NOVEMBER 2019 Source: A commissioned study conducted by Forrester Consulting on behalf of EY, September 2019
 SEIZE THE DAY: PUBLIC BLOCKCHAIN IS ON THE HORIZON 8
45% of respondents are concerned about
interoperability with other blockchain networks.
Interoperability Is A Large Stumbling
Overview

Block For Private Blockchains

Unsurprisingly, given the preponderance of firms that are
Situation

starting their own networks, respondents are concerned about

interoperability. In fact, this was the third most common challenge
behind security and privacy. If everyone is starting their own
network, eventually these disparate networks will need to work
Approach

together to get anything done, which introduces the potential for

problems. Concerns about interoperability with other networks is
even higher for those who are planning or already leveraging public
blockchain. This may be because public blockchains are less likely
to have this problem, making them a potentially better option for
Opportunity

firms looking to leverage blockchain in the long term.

53% of firms that are planning/already

Conclusion

leveraging public blockchain see

interoperability as an issue.

FORRESTER OPPORTUNITY SNAPSHOT: A CUSTOM STUDY COMMISSIONED BY EY | NOVEMBER 2019 Base: 212 director+ blockchain decision makers in the US, Germany, France, Singapore, and Hong Kong
Source: A commissioned study conducted by Forrester Consulting on behalf of EY, September 2019
 SEIZE THE DAY: PUBLIC BLOCKCHAIN IS ON THE HORIZON 9
“How likely is your firm to leverage public
blockchain networks in the future?”
Firms See Future Potential In
Overview

Public Blockchain
43%

Few enterprises use public blockchains at the moment. This isn’t

Situation

surprising in light of current concerns, in particular around security

and privacy as well as the limitations inherent today in what is still a 32%

nascent technology. At the same time, the pace of innovation in the

blockchain ecosystem is rapid, with teams working hard to address
Approach

today’s limitations. Survey respondents also see this potential, with 22%
75% stating that they’re likely to leverage public blockchains in the
future, and nearly one-third saying they’re very likely.
Opportunity

3%
Conclusion

Not at Not Somewhat Very

all likely likely likely likely

FORRESTER OPPORTUNITY SNAPSHOT: A CUSTOM STUDY COMMISSIONED BY EY | NOVEMBER 2019 Base: 212 director+ blockchain decision makers in the US, Germany, France, Singapore, and Hong Kong
Source: A commissioned study conducted by Forrester Consulting on behalf of EY, September 2019
 SEIZE THE DAY: PUBLIC BLOCKCHAIN IS ON THE HORIZON 10

Conclusion
Overview

Early blockchain projects are largely reliant on private networks Project Director:
due to a lack of understanding of how public blockchain networks Rachel Linthwaite,
Situation

operate, fears of the “Wild West” of cryptocurrencies, and firms’ Senior Market Impact
varying appetites for risk. However, private blockchains bring their Consultant
own set of problems, particularly around interoperability.
Public blockchains will have fewer issues related to interoperability, Contributing Research:
Approach

and when appropriately architected, they can still maintain strict Forrester’s CIO
security and privacy controls with the help of technologies like research group
zero-knowledge proofs. But fundamentally, firms need to assess
how they leverage blockchain overall, ensuring the technology
Opportunity

is being used in a way that’s compatible with its design. Firms

that examine the trade-offs of private networks and consider the
benefits of public blockchains will make the most of this nascent
technology opportunity, particularly in the longer term.
Conclusion

FORRESTER OPPORTUNITY SNAPSHOT: A CUSTOM STUDY COMMISSIONED BY EY | NOVEMBER 2019

 SEIZE THE DAY: PUBLIC BLOCKCHAIN IS ON THE HORIZON 11

Methodology Demographics
Overview

This Opportunity Snapshot was commissioned by EY. To create this

GEOGRAPHY COMPANY SIZE
profile, Forrester Consulting conducted a custom survey of 233 IT and
business decision makers in the US, France, Germany, Hong Kong, and
Situation

Singapore. Forrester also conducted three interviews with blockchain

42% US 54% 1,000 to 4,999 employees
decision makers in the US. All research began in August and was
completed in September 2019. 30% France and Germany 33% 5,000 to 19,999 employees

28% Hong Kong and Singapore 13% 20,000 or more employees

Approach

ENDNOTES
1
In this study, we use the terms private and permissioned blockchains interchangeably to mean networks
that require permission to join and where participants must meet joining criteria and may have to undergo
a vetting procedure prior to joining. Public blockchains are blockchains where anybody can participate
without prior vetting or needing permission to join.
2
Source: “Blockchain Technology: A CIO’s Guide To The Six Most Common Myths,” Forrester Research,
Inc. February 7, 2018. RESPONDENT LEVEL TOP INDUSTRIES
Opportunity

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Conclusion

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FORRESTER OPPORTUNITY SNAPSHOT: A CUSTOM STUDY COMMISSIONED BY EY | NOVEMBER 2019

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