Thematic Intelligence: Blockchain in Construction

Thematic Intelligence: Blockchain in Construction

Summary

Blockchain is a method of storing information that makes it difficult to alter the information or cheat the system. The technology can be viewed as a digital record of transactions-like a ledger-that is decentralized, meaning no central authority, such as government or bank, validates a transaction. Instead, transactions are shared or distributed among all participants on a peer-to-peer (P2P) basis within the network. The technology suits applications where data must be shared, and data integrity and traceability are paramount. Blockchain applications are limited in construction but include supply chain management and tracking Scope 3 emissions.

Blockchain is a small but fast-growing industry

GlobalData forecasts the global blockchain software and services market will grow from $12 billion in 2023 to $291 billion in 2030, expanding at a compound annual growth rate (CAGR) of 55%.

Blockchain is a method of storing information that makes it difficult to alter the information or cheat the system. The technology can be viewed as a digital record of transactions-like a ledger-that is decentralized, meaning no central authority, such as government or bank, validates a transaction. Instead, transactions are shared or distributed among all participants on a peer-to-peer (P2P) basis within the network. The technology suits applications where data must be shared, and data integrity and traceability are paramount. Blockchain applications are limited in construction but include supply chain management and tracking Scope 3 emissions.

Digitalization is a prerequisite to blockchain adoption

Strong IT infrastructure and a high degree of digitalization are prerequisites to adopting blockchain. The construction industry has generally been slow to digitalize. Construction companies that still rely on paper-based documentation will find it counterproductive to adopt blockchain and should instead focus on adopting building information modeling (BIM) as a prerequisite.

Blockchain is not always appropriate

The capabilities and drawbacks of blockchain are not widely understood. A poll conducted by GlobalData in 2024 revealed that just 24% of respondents fully understood the technology. Lack of understanding, coupled with the hype surrounding blockchain, can lead to misaligned expectations, resulting in blockchain adoption being driven by novelty without consideration for its appropriateness. Construction companies must remember that blockchain is not always the optimal solution. Implementing blockchain can be complex, whereas a traditional database offers efficiency and simplicity and will suffice for many use cases.

To mitigate the risks of adopting blockchain, construction companies should use blockchain as a service (BaaS) to avoid the high upfront costs of developing blockchain solutions in-house.

Scope

• The “Blockchain in Construction” thematic intelligence report gives you an in-depth insight into the impact of blockchain in construction, including key players, challenges, and market size and growth forecasts. The report elucidates the growing importance of blockchain in the construction sector along with the progress made by the leading construction companies to adopt blockchain. These detailed analyses are critical in developing effective business plans to gain a competitive edge.

• Discusses the challenges the construction industry faces and how blockchain can be used to help address them.
• Evaluates the impact of blockchain in the construction sector, including various use cases and case studies.
• Benchmarks leading blockchain vendors, and leading construction companies based on their adoption of blockchain.