In 2019, it was clear that regulators overall had become much better at parsing the differences between cryptocurrency and blockchain and, increasingly, the difference between permissioned and permissionless blockchains, an even less acknowledged and understood distinction.
In cryptocurrencies, questions around their classification were prevalent. In blockchain, there were two new trends: firstly, regulators putting together comprehensive blockchain strategies; secondly, the public sector making advances in using blockchain themselves – known as ‘govtech’. The progress for the latter took many forms, issuing requests for information (RFIs) and requests for proposal (RFPs), creating govtech sandboxes, making funds available for govtech solutions, and including govtech in public sector blockchain strategies.
The prominence of govtech in 2020 blockchain
Looking ahead at 2020, we expect to see several trends as blockchain becomes increasingly adopted through a variety of industries.
We anticipate a significant uptick in the quantity of govtech engagements, particularly related to procurement and funding distribution, food and drug safety, asset tracking, and identity solutions. We expect the majority of the govtech tenders to be relatively small in size as governments are on the path toward full deployments, but most will steadily ramp up the size of each project from proof of concept phase, to pilot, and then to production. As governments are generally risk averse and cost conscious, they – like the private sector – will be looking to establish proof points to justify further investment and expansion of blockchain work. One way to do that is to deploy a solution first in the smallest, tightest scope and expand to additional participants, products, or regions as appropriate.
Another trend for 2020 will involve regulators focusing on practical implications of blockchain implementations, including data privacy and data transfer, as…