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From my limited understanding of blockchain technology in general and ethereum in particular, whatever the token, or ether that this technology uses, eventually it has to be related to fiat money. Eg: a gas has to be paid for in ether, which can be purchased from fiat money such as USD.

So whatever the benefits of blockchain promises, such as displacing much of the sector’s infrastructure, cutting out middlemen, speeding transactions and reducing costs for things like securities and payments processing, the usefulness of blockchain technology is very much limited by the stability of the currency conversion; if the price is volatile, then blockchain can't be widely adopted because no one would want their investment to drop 50% overnight.

Am I right on this? If yes, why banking and logistic sectors are still implementing the blockchain technology right now when the price is violatile?

closed as off-topic by Achala Dissanayake, ivicaa, cleanunicorn, mirg, lungj Apr 1 '18 at 17:28

This question appears to be off-topic. The users who voted to close gave this specific reason:

  • "This question does not appear to be about Ethereum, the decentralized application platform and smart contract enabled blockchain, within the scope defined in the help center." – Achala Dissanayake, ivicaa, cleanunicorn, mirg
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I will start with your premise.

So whatever the benefits of blockchain promises, such as displacing much of the sector’s infrastructure, cutting out middlemen, speeding transactions and reducing costs for things like securities and payments processing

It seems you are focusing on the payment/banking sector. While, indeed, it was/is the sector that most cryptocurrencies tried/try to "attack", it certainly not the only one.

Let's define what blockchain means. We are going to use the definition given by HyperLedger :

A blockchain is a peer-to-peer distributed ledger forged by consensus, combined with a system for “smart contracts” and other assistive technologies

By this definition, blockchain and currency aren't associated by default, because it's not the case. A blockchain/ledger is used to track something : In Bitcoin's case, a currency.

If yes, why banking and logistic sectors are still implementing the blockchain technology right now when the price is violatile?

By combining everything written above, the answer is simple : they are implementing it because of the benefits you listed and because they don't need to implement a currency with it. As you said, they are implementing the technology, and aren't using existing projects like Bitcoin or Ethereum. That's the key : Bitcoin and others are tracking currencies (their own) as said, and banks (for example) will track other things like payments, use of ink, or whatever. They could use HyperLedger (for example) because it can be used to track anything.

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I'd like to point out two things:

1) Yes, the price is volatile currently. But most likely it will stabilizie in the future.

2) In some scifi minds there is no need for fiat in the future as you can just cryptos for everything. Who knows if this will ever happen, but most likely the need for fiat will go at least down a bit when you are able to buy more things with your pure crypto coins instead of first converting to fiat.

I'd also imagine organizations are now implementing Ethereum stuff so that they're ready for it when the right time comes and they'd have a huge technological advantage (readiness). If nobody plays around with it, it dies and gets useless. Some people have to be the pioneers.

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The relation between eth and USD is somehow volatile, sure. But that is the trading thing. The trading price is one thing, and is mainly used by who trade these utilities to gain money and speculate.

But buying eth is not the only option you have to own eth. If you do business with the blockchain and you need to spend gas to run your software you won't buy it in the market. Will be more smart for you to setup a node and mine your own currency to spend and pay the gas or anything else. That would be more stable because the electricity price is more stable than the eth price. Yet, if the market price drop, you can stop mine it and you can buy the eth from the market (if its more cheap to buy at market price other than paying the electricity bill).

On the other side blockchain is not only ethereum or bitcoin. Blockchain is a technology and there are a lot organization or institution that are building their own infrastructure. Banks will more likely setup their private blockchain (see Quorum, an ethereum fork), they will not use the public one. Same for institution and anything else.

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