• Colin Doyle CFO

Blockchain snuck up on us

During the past year, blockchain went from the buzziest word in the tech world to a hot potato no one wanted to hold, in terms of marketing. If you’ve noticed less talk about blockchain this year from technology product makers, that’s on purpose: Companies have realized big promises without flashy results makes consumers suspicious.

But that doesn’t mean blockchain hasn’t delivered on those promises. The thing is, what blockchain does best is done quietly. A blockchain is basically a growing list of records that are resistant to modification, and therefore extremely secure. It makes whatever actions, transactions, and activities that occur upon it safe and reliable. And “reliable” isn’t sexy — it’s just something we need, especially in the accounting profession. Ideally, if it’s working well, we won’t even notice it.

And that’s what’s been happening. For instance, Veem, a payments app that debuted in 2014 and has been successful since, allows business users to send payments with no upper limit across borders instantly. In other words, the app can be used to send $2 or $22 million, and that is only possible because the payments are sent on a blockchain. But Veem doesn’t plaster the word “blockchain” across its PR or advertising, because it doesn’t need to. The app just works.

And that’s what we all want from our technology — it should do what we need it to do, and it should be easy. After that? No questions!

Payments are the obvious first step, in the accounting and finance world, for blockchain application. Providing immutable distributed ledger entries establishes trust and security for the exchange of funds. Veem is in good company with several other payments platforms, like Circle and Airfox, both based in Boston, and Ripple, which like Veem is based in San Francisco. And these have proved to be the first step to getting blockchain into accounting software itself — for instance, Veem integrates with NetSuite (and has achieved “built for NetSuite” status), essentially embedding blockchain capabilities right into NetSuite, ready for use now.

Another accounting software company, which by request shall remain unnamed, has been trying to build a blockchain platform to underlie its accounting software product, and to thereby provide a product for lenders to assess the credit risk of the businesses using that accounting software (with their permission). This credit assessment and loan activity would be facilitated by cryptocurrency tokens that the company itself issues. The company has stopped advertising its planned blockchain capabilities because it’s simply been taking far longer than it anticipated to build.

“Currently the market is a very pessimistic environment for the blockchain space, and that’s the biggest challenge,” the founder of the company in question said. “They’re not so responsive. We’ve reached out to between 10 to 15 crypto exchanges, and barely anyone responded. We might have to go on a second tier exchange.”

Secondly, and also tellingly, it’s been hard to find the right talent. “Our other biggest challenge had been finding the talent that we need to deliver on this kind of project,” the founder said. “It’s one thing to come up with a great idea, but you need a great team of developers to deliver.”

Issues around retaining top talent are not new in tech. Cybersecurity experts, for instance, are in extremely high demand, and firms have difficulty retaining them without top salaries and attractive project opportunities. And market skepticism is what has led to blockchain companies to stop the hype, keep their heads down, and work to perfect their product before making big promises.

If you’re interested in the application of blockchain for accountants, be patient. It’s coming, and it will be here before you know it. In fact, it already is.

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