Bitcoin App Development trends 2017

5 Trends in Blockchain and Bitcoin App Development

by Rick Martin
The demand for blockchain and bitcoin developers, and the solutions they can provide, is greatly outstepping the supply. The slow-but-steady acceptance of bitcoins by both large and small companies has created the need for Bitcoin payment applications, as well as for various other Bitcoin application development solutions. Of greater significance is how Bitcoin introduced the blockchain concept, which is now being viewed as the new frontier for conducting fast and secure transactions of all types. In fact, while blockchain was once synonymous with Bitcoin, blockchain has grown legs and moved out on its own. Today, dozens of companies are developing shared ledger systems that have nothing to do with Bitcoin, but which are touted as blockchains. While the need for bitcoin software development remains strong and growing, opportunities in blockchain technology are exploding. In this article, we are going to explore both sides of the coin.

Smart Contracts

The term “smart contract’’ is actually a misnomer and does not necessarily involve contracts, though it can. In the most basic sense, a smart contract is a relatively small program that is stored and executed on a blockchain. Why anyone would want to do such a thing becomes evident when you consider the advantages blockchains offer: resilience that comes with a distributed system, unmatched security, and potentially faster execution speed compared with centralized hosting of applications, to name but a few. Smart contract code can be written to perform a wide variety of functions, but they mainly place conditional controls on digital assets. To make this concept clearer, here are a few examples of what smart contracts can do:
  • Release a digital asset, such as an online course Certificate of Completion, only when the sum total of digital currency payments made by a student equals a specific amount, AND only after successful completion of all lessons.
  • Release crowdsource funds only when a specified minimum number of contributors have collectively donated a minimum amount, BUT only of the amount is reached by a specified date. Unless all these conditions are met by a certain date, all funds would be returned to the donors.
  • Submit a legal contract to attorneys for execution only if the person submitting the contract has supplied required digital credentials and made the required payment.
  • Automate exchange platforms to better meet regulation compliance.
As you can see, smart contracts, or smart code, can do useful things, including facilitating the execution of actual legal contracts. We have only scratched the surface in describing the uses for smart contracts. The ability to store and execute programs on a blockchain — especially to control digital assets residing in that chain — lends itself to a world of opportunities within the blockchain space. Developers who can specialize in creating smart contract code are already in high demand. But a word of caution is in order. Since what goes into the blockchain stays in the blockchain unaltered, smart contract code must be perfect. Bugs cannot be fixed once the code is added to the blockchain, which makes implementing complex blocks of code a risky proposition.

Ethereum

Ethereum is an open source blockchain that is very similar to the Bitcoin blockchain. So similar, in fact, that it has been called Bitcoin 2.0. However, there are two distinct differences that make Ethereum superior to the Bitcoin blockchain:
  • Ethereum allows users to use not only bitcoins, but other cryptocurrencies as well.
  • Ethereum was built with smart contracts in mind.
Ethereum functions as a standard, albeit powerful blockchain platform, complete with mining components. It is, nevertheless, a smart contract platform at heart. The Ethereum Virtual Machine (EVM) was designed with the speed and power to run smart contracts. It even comes with its own high-level programming language, Solidity. designed to help developers write robust smart contracts on the EVM platform. Developers wishing to tap the emerging and lucrative smart contract market would do well to consider Ethereum. Not only is there opportunity in developing smart contracts for clients, but Ethereum also rewards developers with Ethers (Ethereum’s native currency) for developing robust, error-free Solidity-based code.

Retailer Bitcoin Payment Solutions

The continued acceptance of Bitcoin by retailers means opportunity for the innovative developer. Not only is there always room for a new and improved Bitcoin wallet for consumers, but retailers need easily-implemented Bitcoin merchant solutions for accepting bitcoins as payment, as more and more are inclined to do. Bitcoin wallets do not store bitcoins, but the private keys that access them. The challenge this poses to developers is great. Best practices for data security and encryption are required, in addition to the innovation needed to create a unique product. Whether you are looking at developing a software wallet that will reside on the user’s device, or a web-based wallet, there are unique security challenges that you must consider with each. As of the time of this writing, at least 99 major companies accept bitcoins, and the list is likely to grow steadily for the foreseeable future. More and more retailers and other businesses are seeing the increasing value of the bitcoin and want a piece of the action. The entire nation of India is poised to be the next market for bitcoins. Along with the greater acceptance is an increased need for solutions that allow businesses to accept the cryptocurrency. No, Bitcoin is not dead — resurrected, perhaps, but still worth pursuing for development opportunities. As long as investment dollars continue to flow into Bitcoin, and they are, there is good reason to develop in the Bitcoin space, especially for retailers.

Emerging Markets for Blockchain

Blockchain technology is new enough to be scary, and powerful enough to be exciting. Developers intent on developing for cutting-edge markets should consider who can benefit most from blockchain’s features. If you consider just the three advantages we mentioned earlier (speed, security, and resiliency) — there are more, a list of markets comes to mind.

Healthcare

Data security is essential in the healthcare industry. Combine that with the need for multiple parties to have fast access to large volumes of data, and you start to write a prescription for blockchain. There are already at least eight startups that endeavor to bring blockchain solutions to medical research labs, healthcare facilities, and disease management programs. The field is still wide open, but competition will soon be fierce.

Gaming

Gaming might not be at the top of your list when thinking up new markets for blockchain, but it should be. Games are already being developed that run on blockchain technology. Blockchain makes it easier than ever to incorporate powerful asset-sharing and purchasing features within a game. While the emergence of blockchain as a gaming platform is still in the fetal stage, developers who can figure out how to make it work will benefit from the ever-lucrative gaming market. Further, gamers’ love of technology make them an excellent test market for new platforms.

Insurance

One industry that probably didn’t expect to be disrupted by fintech technology is the insurance industry. But thinking the fintech tidal wave would pass them by unscathed was neither realistic nor self-preserving. Indeed, fintechs have some very interesting ideas on how to make their move on the insurance business, and they aren’t playing around. By utilizing the seemingly limitless power of blockchain technology, fintechs are creating new insurance models that make a lot of sense. Consider these possibilities:
  • Peer-to-Peer (P2P) insurance can provide greater benefits at lower premiums, since there is no agent working for the interests of the insurance company.
  • Parametric insurance pays policyholders not based on pure loss, but based on certain triggers. For example, a policyholder who experiences property damage from a hurricane may be paid an amount based on the category of hurricane. Such conditional agreements can be well-facilitated by smart contracts.
  • Decentralized repositories for storing policies, especially if shared by different agencies, could help reduce insurance fraud. While not actually disruptive, allowing insurers to share information on a shared ledger would certainly impact the industry and its customers in some positive ways.

Law Enforcement

While it is true that law enforcement agencies are banning together to combat criminal activity on the Bitcoin blockchain, they seem to little realize the benefits blockchain technology can offer them in their daily operations. If blockchain did not exist, it should be created just for law enforcement. The need for top-level security, and the ongoing requirement for multiple agencies to access large amounts of data quickly, make law enforcement an ideal market for blockchain technology. Penetration may be difficult, but sooner or later it will happen. Since law enforcement does not often accept major changes to infrastructure. Therefore, developers who can offer viable solutions to this discrete market early will take market share. In other words, the market may be wide open, but don’t expect it to be receptive to late comers who arrive after viable solutions have already been adopted.

Private and Consortium Blockchain Networks

For the most part, when we talk about blockchain, we are talking about public networks where access may be controlled, but is not restricted to only certain players. Many applications, such as Bitcoin, will only thrive if open to the public. On the other hand, non-public blockchains also have their place. Here are a few use cases for private blockchains:
  • Banks that need a settlement layer for currencies and securities where only bank employees are allowed.
  • Corporate accounting, where multiple parties need access to highly-sensitive information in a secure environment.
  • Test platforms, where financial services can be tested before rollout onto public blockchains.
Further, as institutions look for ways to make blockchain work for them, many will find it beneficial to forge alliances with industry partners. Called consortiums blockchains, these networks can prevent organizations from traveling the blockchain highway alone. For example:
  • Insurance agencies can partner to create the shared blockchain we mentioned earlier.
  • Banks can create shared blockchains in order to develop common cryptocurrencies.
  • Government agencies can place shared data on a consortium blockchain for better security and efficiency.
Although the market for public blockchains will drive investment in the near future, developers should not ignore markets for private and consortium blockchains. Competition is likely to be less and the financial rewards often greater.

Supply Chain

Supply chains present another opportunity for fintech development. Current systems that exist for tracking the creation, marketing, and distribution of goods are long overdue for improvement, if not disruption. The problems they present are not easily resolved. Inherent lack of transparency keeps much of the supply chain data obscure or incomplete. Detecting fraud or other nefarious activities is difficult. And tracking such issues as environmental impacts of supply chain elements is often impossible. Once again, blockchain technology holds the promise to impact an industry in powerful and positive ways. Blockchain can offer both transparency and security of the same data, which is difficult for other technologies to do. It allows multiple parties to input information that can be shared in near real-time with others. And through the use of smart contracts, important and timely logistics decisions can be automated. IBM is one of several companies providing blockchain solutions to the supply chain industry. There remains plenty of opportunities for developers to offer solutions to companies of all sizes in this emerging market. The key to success will be developing systems that are robust, flexible, and scaleable.

How Ignite Can Help

Blockchain technology is no longer a buzzword. It has well-established itself as a disruptive force that is poised to invade industries by the score. Many fintechs will make a name for themselves developing solutions in the blockchain space, while others will fail outright. Whether yours is a name industry leaders will come to know, or one they never hear, will be determined not only by your commitment, but by your competence. Ignite is a leading outsource provider of technology solutions. With six R&D labs across Europe, we  have the skills and experience inhouse to develop your blockchain or Bitcoin application. If you need a custom development solution, why not contact us today for a no-cost consultation?