Professional services firm KPMG has published a report predicting that blockchain will be one of five emerging technology sectors in which companies will invest the most over the next 12 months.
Titled Enterprise Reboot, the report was compiled by KPMG International and HFS Research. It is based on a survey of 900 executives from organizations on the Forbes Global 2000 list of the largest public companies with annual revenues of more than $1 billion.
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While blockchain investment was found to have fallen by 63% due to the pandemic, the report predicts that the industry, along with artificial intelligence (AI), cloud, 5G and process automation technologies, will see an increase in investment as leading companies seek to gain a competitive advantage in the post-COVID-19 business climate.
Technology spending has been hit hard
KPMG noted that Global 2000 companies moved quickly to cut funding for Bitcoin Freedom emerging technologies as the coronavirus quarantine and recessions took effect, forcing companies to prioritize survival over all other considerations. About 40 per cent of executives indicated that they had decided to stop investing in emerging technology initiatives altogether.
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The report found that block chain finance was most affected by the quarantine caused by COVID-19; distributed general ledger (DLT) technologies slipped from the largest emerging technology sector with a weighted average investment of USD 18 million to the second smallest, at USD 6.5 million.
Executives reported that blockchain investments fell by 63% on average, representing the largest average percentage loss of funding among emerging technology sectors.
However, the report found that 59% of executives believe COVID-19 has created a momentum to accelerate digitization initiatives.
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Executives report that investments in block chains are seen as offering improvements in „competitive positioning“, and will improve efficiency and governance processes and provide the „basis for infrastructure modernization“.
The report found that 65% of executives believe that the combined use of emerging technologies will yield greater benefits than investment in a single technology alone.
However, Steve Hill, KPMG’s global head of innovation, said that trust issues continue to hamper distributed general ledger technologies.
„Visible trust gaps for emerging technologies such as AI, blockchain and IO [internet of things] remain significant barriers to adoption,“ he said.
„I believe that organizations will have to build the right kind of trust for the successful deployment of emerging technologies to recover from the crisis … It is these organizations that are likely to navigate through the recovery best.