9 Making Sense of Blockchain: How Firms Can Chart a Strategic Path Forward ^Top for its stakeholders, then align their interests to secure cooperation on a proposed solution. 2) Derailing Traditional Revenue Sources Blockchain is likely to disrupt the revenues of businesses that connect stakeholders or create credibility and trust for them.12 Examples include retailers such as Google Express and Amazon that connect buyers and sellers, banks that provide escrow services and currency swaps, and law firms and notaries that provide trust services. Smart grids will displace today’s centralized energy distribution business models, allowing peer- to-peer electricity and alternate energy trading.13 Resistance to commer- cializing blockchain is hence to be expected from such firms. 3) Updating Infrastructure Integrating legacy systems with new technology can present a daunting challenge. The Quartz crisis of the 1970s offers a well-known example: Swiss watchmakers refused to switch from their legacy mechanical watches to electronic watches even as competitors were evolving.14 When it comes to blockchain, updating infrastructure is currently cost-prohibi- tive and risky. In addition to initial capital expenditure, firms will face cap- ital losses from discarding legacy infrastructure. Operational expenses 12 Knowledge@Wharton, “Is blockchain the next great hope – or hype?,” Knowledge@Wharton, January 11, 2017, http://knowledge.wharton.upenn.edu/article/blockchain-next-great-hope-hype/. 13 Mike Orcutt, “How Blockchain Could Give Us a Smarter Energy Grid,” MIT Technology Review, Octo- ber 16, 2017, https://www.technologyreview.com/s/609077/how-blockchain-could-give-us-a-smarter- energy-grid/. 14 Michael J. Enright, “Organization and Coordination in Geographically Concentrated Industries,” in Coordination and Information: Historical Perspectives on the Organization of Enterprise, ed. Naomi R. Lam- oreaux and Daniel M. G. Raff (National Bureau of Economic Research, January 1995), 133-140, http:// www.nber.org/chapters/c8751. Joe Thompson, “A Concise History of the Quartz Watch Revolution: In the watch world, the 1970s changed everything,” Bloomberg, November 16, 2017, https://www.bloomberg.com/news/articles/2017- 11-16/a-concise-history-of-the-quartz-watch-revolution.