Tradeshift CEO: Blockchain ‘isn’t ready yet’; too expensive and hard to scale

Blockchain technology is not mature enough to have any real benefit for supply chains, claims CEO and co-founder of digital invoicing firm Tradeshift.

Christian Lanng spoke to CNBC about the current status of blockchain and its potential impact on supply chains both now and in the future, stating that it could greatly impact cost and efficiency, but does not yet have the capacity to scale.

“The problem is that it’s not a high-performance technology,” he said. “Whenever people say blockchain, I think what they’re really saying is they would like to connect things digitally… I don’t think blockchain is a mature enough technology yet to carry that… I also want to be a little bit cautious for some of the hype.”

The apprehension around hype that comes hand in hand with any new technology such as blockchain is common, and just last month JP Morgan CIO Lori Beer expressed sentiments related to its application rather than the tech itself:

“The application of this technology in business is more important to us than the technology itself. We are looking not only for cost reduction, but also for opportunities to develop new products.”

Meanwhile, big firms including JP Morgan have called cryptocurrency a ‘scam’ and written it off entirely.

CEO Jamie Dimon said: “Everyone I talk to in the banking industry, regulators, central banks – everyone sees the potential. But everyone is trying to fundamentally grapple with the issues. I wouldn’t say crypto is bad, but I think crypto needs some evolution.”

Lanng continued: “When you run a global supply chain, you have [thousands] of transactions per second. So, I think for identity, I think for certifications and stuff like that, blockchain is useful… For the main transactional scenarios, it’s not ready yet. It’s too expensive and it’s very complicated to build and scale.”