Blockchain is frequently mentioned as a transformative technology with the potential to disrupt the private funds industry. Given the frequency and reverence with which it is mentioned, at first glance it appears that blockchain technology is already widely used in the industry. Upon closer inspection, however, it becomes clear that widespread uncertainty persists about what blockchain even entails, not to mention where the technology currently stands and how it could plausibly be used to improve private fund operations. To help our subscribers understand the status of blockchain technology and its potential to aid the private funds industry, this three-part series serves as a primer about the technology and its interplay with the private funds industry going forward. The first article provides an overview of how blockchain functions and examines how the finance industry is already utilizing it. The second article describes potential ways private funds and service providers can adopt blockchain technology to enhance fund operations and compliance practices. The third article explores some of the risks impeding the growth of blockchain and addresses the most plausible timing and manner for it to be eventually adopted in the industry. For more on blockchain, see “Private Fund Advisers and Service Providers Must Evolve Their Businesses to Keep Pace With Innovations in Technology, or Risk Becoming Obsolete” (Jan. 18, 2018); and “How Blockchain Will Continue to Revolutionize the Private Funds Sector in 2018” (Jan. 4, 2018).