Why vision matters in blockchain

At the outset of any startup, it’s imperative to be mindful of your specific vision. A well-defined vision helps you focus, and to create a purpose and measurement of your success, ultimately, to achieve your goals by overcoming obstacles along the way.

Have you?

  • Enabled a secure internet of value
  • Become a specific part of the backbone of Web3
  • Enabled companies to utilize blockchain as a value-adding tool
  • Enabled the world to do high-frequency, low-cost transactions
  • Enabled more transparency and data security in certain processes in our society

Why is vision important for Blockchain?

We’ve witnessed many projects simply aiming for broad adoption with companies, and blockchain projects building on them - then ultimately, „crypto investors“ to drive the price of tokens to the moon. These goals can be somewhat legit, though the lack of public vision is hindering broad adoption which can harm the price of tokens through the “wrong usage“ long-term. We’ve often heard statements from core developers like this:

This is only the core technology. Build whatever you want on top of it, or fork it and improve it.

This is indeed true for open-source software, however, at FullBlock Solutions, we’ve seen that a core team can have a major positive impact on the future usage of a platform, and certainly negative, too. Protocols should plan the short, mid, and long-term because adoption from different target segments will very likely cause varied usage. We‘ve all seen that just one popular „game“ can lead to high-usage, adoption, and marketing value in the short-term, though it can adversely affect other applications running on the platform which sees other projects being reluctant to build on that blockchain for fear of a repeat event in the long-term. The kind of projects you attract to your platform will have an impact on many levels, including transaction costs, number of node owners, security, adoption and token price.

Porter’s generic strategies and success stories in blockchain

In order to gain a competitive advantage over industry rivals, it makes sense to look into „Porter’s generic strategies“, and some best practices and success stories in blockchain. Porter’s generic strategies include „overall cost leadership“, „differentiation“ and „focus“ with the goal of not being „stuck in the middle“.

Porter's generic strategies

Some blockchain platforms have been able to position themselves clearly, such as; 

  • Hyperledger and Corda in „blockchain for business“
  • Ripple for one specific vertical – finance
  • Ethereum for Dapps

Others position themselves generally as „market leaders“ in one area of the world – this can work well for customer-facing businesses such as exchanges - and may work in the short to midterm for protocols, but can be harmful in the long-term when people in that region become aware of protocols with better specific offerings. Besides focus or differentiation in a particular area, most public blockchains must remain competitive on transaction costs.

More and more blockchain platforms such as Ethereum, Waves and other projects join the Web3 vision of an interoperable network which should enable a new, secure internet of value with individuals and machines owning their digital identity and data. In this ecosystem it’s important to add real value to the existing tech stack and potential users. Results can be seen in expert cross-chain collaborations on specific topics.

What should be done?

Without clear vision and ideas about the future use of a platform, it’s not only tough to communicate the value proposition, it’s also likely to end up being „stuck in the middle“. Platforms are usually open and available for everyone to use, so you – as a project – can have a vision for the „right use“, though its possible the platform will be used in a completely different way than intended. We firmly believe it makes sense to define what kind of adoption you want to see on your platform - the ideal scenario is matching it to your tech capabilities. It will then be easier to target your preferred segments, and it’s likely you’ll achieve meaningful, sustainable demand on the platform. Clear communication reflecting “not aiming for crypto traders and investors”, rather, focusing on “a community of builders and makers” is one way of reducing stakeholders, and focusing on meaningful adoption from the very beginning. (See NEAR protocol)

Knowledge about the competitive landscape will be important for the positioning of a project. Advantage can be gained by not replicating existing tech, and finding your niche which will add real value to the industry and your potential clients.

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