The Energy Side of Blockchain, Bitcoin, & Cryptocurrency
On March 3, 2020, TF Blockchain hosted their 7th TF Austin event called "The Energy Side of Blockchain, Bitcoin, and Crypto." The panelists discussed how energy plays a factor in bitcoin and cryptocurrency from mining all the way to innovations for energy sectors like oil and gas, and clean energy. This article is a follow up to that event and podcast recording.
The expected aftermath of the success and effectiveness of an invention like blockchain technology, as well as all aspects of the crypto space, is the integration of blockchain into other industries. In this case, mainstream industries.
For an invention designed as an abstract, digital space for decentralization of regulations on a centralized server, cryptocurrency has expanded beyond those boundaries. Naturally, blockchain, and the cryptocurrencies (especially bitcoin), will also be available to a much larger crowd than the digital users. This surmises the lead-up to the big bitcoin surge and the ensuing enterprise, industrialization, and classification as a digital asset with mainstream financial requirements like a tax.
While most of the concurring enterprises and industrial integration, off the crypto space, centered on the currencies, there is one novel aspect that has not been fully tapped into for mainstream business –Energy.
In this podcast, the Austin chapter of TF Blockchain, led by Kurtis Friesen, hosted a panel session on the ‘Energy side of Blockchain, Bitcoin & Cryptocurrency’. The panelists on this session are professionals in the evolving market of energy in blockchain technology; Nathan Stolzer (CEO & Co-Founder, Lonestar Data Technologies), Gary Hargraves (Digital Leader – Oil & Gas, Wipro) and Victor Sauers (CEO, TKO Energy Capital).
The conversation kicked off with Gary, who provided a fundamental understanding of the evolution of blockchain technology enterprises. His contribution surmised the relationship between incentives in blockchain, the trial for real estate and finally the inclusion of power for gas production. The panelists continued to discuss the timeline for the evolution of energy production in different zones and finally, the integration of the energy industry with blockchain technology.
At its fundamental basis, blockchain is a branch off of crypto tech that is a decentralized ledger on the digital space. Originally, the blockchain was the structural backbone for bitcoin transactions, now used for other currencies and forms of transactions. It is mostly accessible to the public for transparent verification but, peer-to-peer transactions on the crypto sphere are kept encrypted in the blockchain.
The features of blockchain technology make it quite appealing to the mainstream industries as it is, at the core, a decentralized system on a very much centralized digital space. Although the concept of blockchain technology was to keep transactions and activities on an abstract platform, enterprise and industrialization have created the need for more modifications like governance and industrial investment (venture capital).
Its decentralized nature makes blockchain technology a great tool for enhancing efficiency and creates a need for the energy industry to infuse it for lower-cost operations, to maximize flexibility and time reduction for transactions. While the crypto space and blockchain are reliant on the energy supplied into the system, this need becomes a turnabout, testifying to just how much the digitalization feature will influence blockchain technology for growth in the energy market.
Another highlight is the foundation for the developing energy sector in blockchain, which is the potential of this crypto technology to minimize situations of discrepancies in operations of the energy sector, especially oil and gas. The transparency of blockchain technology enhances the accuracy of designated freight rates and the generation of invoices.
These distinct features of the blockchain (enforced cybersecurity, transparency, and lower costs of transactions) make it logical for the energy industry to establish projects based on blockchain technology. These projects will promote a new system of operations in the industry with further decentralization. As an extended result, there are more opportunities.
The Conversation features an article on ‘The Future of Blockchain’ that indicates that the adaptation of blockchain technology for the energy market is through a form of peer-to-peer energy trading. It is expected that, within the next five years, “peer-to-peer energy trading” and “electric vehicle charging and sharing” would be the most applied forms of blockchain technology in the energy market.
Following the round of discussion on the panel session, and some questions established that, there are many essential benefits of blockchain technology for the energy industry; reduced costs, environmental sustainability, and increased transparency for stakeholders without compromising privacy, among others. However, the limitations should also be on the same scale.
The issues of the unclear regulatory and legal framework, electricity consumption, and technical complexity may prove difficult for the successful integration of blockchain technology for the global energy market.
Despite the reality of these issues, some corporate bodies, especially in the oil and gas industry have already set up their blockchain technology platforms. According to an energy grid management article on Smart Energy, Shell and BP already took the first steps by announcing the launch of their blockchain oil trading platform to automate and digitize various oil field related services. This correlates to a report on PR NEWS WIRE that, with its current trend, the blockchain technology in the energy market is set to hike to around USD 18 billion by 2025.
In the conclusion of the panel session, the conversation moved towards investment in the energy market sector of blockchain technology. Victor Sauers provided the majority of the contribution with his professional experience in industrial investment as CEO of TKO Capital. Despite the limitations, there are several incentives for investors in the energy-blockchain infusion. Therefore, the major growth of this merge can increase exponentially within the next few years.
Listen to the podcast here: