Demand for blockchain skills continues to be strong. According to a 2020 LinkedIn study, blockchain is the most in-demand job skill and ITJobsWatch.co.uk shows that blockchain vacancies are paying roughly 50% more than standard software engineering vacancies.
But why is this and what does it actually mean? In this article, we’ll look at what’s driving the demand for blockchain, what kind of roles are available and how to build the right skills to be relevant in this emerging and highly competitive market.
What is Blockchain?
Blockchain, commonly referred to as ‘distributed ledger technology’, enables computers to share data in a way that prevents tampering. By using cryptographic proofs and no single points of trust (such as central authorities or database administrators), it ensures that the information one computer has, is identical to the information another computer has.
The first mainstream application of blockchain was Bitcoin, which was introduced in 2008. This is a cryptocurrency which uses a blockchain to log online payments and proves, without the use of financial institutions, that each transaction was agreed to.
Since this time, the possibilities of blockchain have become more apparent to organisations. If a business network uses a blockchain to log transactions between suppliers, it can avoid costly disputes and help build trust, because each participant can see proof that transactions occurred. For example, throughout the COVID-19 pandemic, the Rapid Supplier Connect blockchain has been helping healthcare providers source PPE, by convening a trustworthy marketplace with worldwide suppliers.
As blockchain networks continue to form and grow, organisations need to hire people to take advantage of this new generation of transactional applications. Skills required can vary and span a spectrum of business-oriented and technical roles. Let’s look at some of the most common.
Blockchain is relevant to the business community because it helps trade to happen more easily. A commonly cited analogy is the internet which, of course, allows us to exchange information with someone in the next continent just as easily as in the next room: it removes all major barriers to information flow.
The idea, is that if blockchain could do for assets and transactions what the internet did for information, then the way we do business would fundamentally change.
This might sound a little hyperbolic, but a shift has already started, with businesses using blockchain to reach new markets and reduce costs. For example, the we.trade network provides trade finance to small and medium-sized businesses, which would otherwise be too costly to process.
However, achieving success with blockchain is hard work. Blockchain solutions present a long term goal; three to five year roadmaps are not unreasonable. The analyst, Gartner, predicts that blockchain’s full potential won’t be achieved for several years.
Blockchain is difficult because identifying a good use-case and then being able to transform business networks to take advantage of it, takes a huge amount of time and effort. Each member of a blockchain network needs an incentive to join and use-cases are only viable when applied to a group of organisations with a need for mutual trust.
With this in mind, the success of blockchain projects requires people with deep industry knowledge, who understand end-to-end business processes and have an eye for identifying inefficiencies.
At the other end of the spectrum, all blockchain projects need people to write and test the software that makes the system work.
The development communities behind blockchain have worked hard in recent years to lower the barriers to entry for software engineers looking to learn - but be warned that it’s still very easy to get side-tracked. A common mistake made by new starters is to dive into the weeds; while this is tempting for many technologists, it is easy to quickly get disheartened by a dizzying number of concepts and terminology.
Unless you’re looking to advance blockchain technology itself, you generally don’t need to understand the data structures that underpin a blockchain, or how consensus works between nodes on the network. Instead, think of blockchain as a shared database that can be read from, or written to; the system will handle how that data is distributed.
The most important asset type for a blockchain developer is the ‘smart contract’, which describes the shared business rules that underpin a transaction. For example, a smart contract for a house purchase transaction might verify that the seller is the owner of the house, then transfer payment from the buyer and update a land registry record.
Smart contracts are just computer code; they take a set of input parameters, run some logic and produce some outputs - usually in the form of some database updates that are agreed by the participants of the network. (If you’re familiar with database development, smart contracts are very similar to stored procedure calls.)
Sitting between the business and technical camps is a whole set of roles that allow a blockchain solution to provide utility for an organisation. I’ll generalise these as ‘architecture’ roles.
People in these roles will understand the landscape into which a blockchain will be deployed and how to implement it with minimal disruption.
These roles are critical, because organisations that implement blockchain may have decades’ worth of business-critical IT to consider and it’s almost always too risky to immediately replace them. So, how can an organisation slowly begin to gain benefit from a new blockchain system, while maintaining existing processes? This requires careful planning and knowledge of an organisation’s IT history.
Furthermore, architects need to consider three distinct tiers of systems that organisations typically use and the effect that a blockchain would have on them. At the backend is the ‘data tier’, which holds systems of record; the blockchain ledger is one of these. Then there is the ‘business application tier’, which provides utility to the business and ultimately invokes transactions on the data tier.
Finally, there is the ‘presentation tier’ with which end-users interact; this tier does not generally interact with the blockchain itself, but applications may require updates to show and interact with any new transactional information.
Starting a career in blockchain
So, what are the best ways of getting started?
Whether you are closer to the business or technical ends of the spectrum, it’s good to first have an appreciation of blockchain’s strengths and weaknesses. There is still a lot of hype and (frankly) as many bad use-cases cited as good ones.
Blockchain is not the answer to everything, so look at areas in which blockchain has been successfully adopted to gain a feel for what works. Particularly, keep an eye out for business process inefficiencies and new markets and become an advocate for change in your industry or profession.
On the technical side, there is a plethora of resources that can help you build your blockchain skills. There are multiple blockchain frameworks out there, so you will need to do some research to find out what’s appropriate for your target area. The most common blockchains are based on Ethereum, Linux Foundation Hyperledger and Bitcoin technologies.
There are an increasing number of tutorials that teach these technologies from absolute basics, such as the Hyperledger Fabric developer tutorials built into the IBM Blockchain Platform. BCS also has courses leading to professional recognition, such as the Essentials Certificate in Blockchain and Foundation Certificate in Blockchain.
Finally, it’s worthwhile noting that nearly all blockchain frameworks are open source, so if you’re looking to build your CV, a great way of getting started is to get involved with the blockchain development communities. There are also significant research opportunities, particularly around security and consensus mechanisms, which can be another good route in if these are in your area of expertise.
Building business blockchains is hard, but the benefits are potentially huge - not only for the organisations that adopt them, but for those people who make them happen too.
Tim Harford, in the excellent book of his radio series 50 Things That Made the Modern Economy, said: ‘The thing about a revolutionary technology is that it changes everything - that’s why we call it revolutionary. And changing everything takes time and imagination and courage - and sometimes just a lot of hard work.’ This was in the chapter on The Dynamo and highlighted the historical pace at which fundamental change typically takes place. (Blockchain was included on its own merits in the second series.)
It’s too early to say how revolutionary blockchain will be. But, it is rare for a technology to pique the interest of both business and technical communities and this interest is now translating into a significant demand for skills.