Blockchain – it feels like it has been the buzz word for the last year.
Everyone is talking about it. Companies like British Airways and JPMorgan are weaving it into their operations, and social entrepreneurs and charities are utilising it to try to solve some of the world’s biggest problems. So, is it just another fad? Or is it the gamechanger it’s hyped up to be?
What is Blockchain?
According to the UN Global Compact Report 2018, the Blockchain market is expected to be worth $2.3 billion, driven by an increased demand for transparency and reduced exposure to fraud.
In simple terms it is a chain of blocks, each containing information and data that can be accessed from anywhere – it really does what is says on the tin. It is a secure, distributed ledger stored across a network, and its data cannot be tampered with or erased.
Blockchain is decentralised which means there is no third-party provider, bank, or service managing data transactions. Instead, verification happens through a peer-to-peer network of computers. This allows users to trust in the data, without needing to trust the individuals acting within it.
When a new block is created, it is linked to a previous block in the chain, creating a connected directory of information. If everything is in order, the new block gets verified by the peer-to-peer network. If something is not quite right, the new block will be rejected.
One of the big bonuses of Blockchain is that it is protected by advanced cryptography and its data is immutable. If you wanted to tamper with a piece of Blockchain data, you would need to control the majority of the network by convincing over 50% to side with you. You would also need to tamper with the blocks that link back to yours, eating up a lot of time and electricity – If you tamper with one, you must tamper with them all.
Essentially, the time and money you would have to put in to edit, delete, or corrupt data would make it completely unviable.
As well as being secure, Blockchain makes it possible for an item or entry to hold a digital passport, which can be tracked.
So how is it being used to provide solutions for global issues?
Blockchain is being used by business, social start-ups and not-for-profits to progress the UN Sustainable Development Goals and drive positive change for the environment, human rights and ethical and sustainable produce.
“Digital technologies can provide unprecedented solutions to address the fundamental needs of marginalized groups and those at the bottom of the pyramid.”
– Mr. Yannick Glemarec, UN Women Deputy Executive Director
According to the UN Global Compact, unequal access to and control over land are a cause and consequence of inequality. Only 30% of the world’s population has legally registered land titles, with those that are registered being vulnerable to tampering. In developing countries, $20 trillion of land assets sit with no proof of ownership and in Africa, 90% of land is unregistered.
BenBen is trying to change that by providing a platform for digital land transactions in Ghana, powered through Blockchain. Land owners can register their land on the database and digitally share this information with financial institutes and banks. This provides them with an opportunity to invest in loans to further their business or land ownership, and decreases the risk of fraud. It creates an unmistakable evidence base for the true owner of the land and reduces the need for court cases deliberating rights.
Crisis discriminates – women affected by conflict are exposed to elevated levels of risk and vulnerability. According to UN Women it is more dangerous to be a woman than a soldier in armed conflict. At the same time, women play a key role in emergency preparation, planning and response.
UN Women have been exploring the potential benefits of Blockchain in aiding and empowering refugee women on the move. Opportunities include using the platform to store identity information, medical records, ownership of assets and to enable small cash transfers.
As conflict and crisis continue to enforce the movement of millions of people, Blockchain could help refugees ensure they keep hold of vital documents.
In the UK alone, 72% of millennials are willing to pay more for sustainable products. With this increased demand for ethical produce, Blockchain is expected to continue to grow in this market, with the UN Global Compact report listing an opportunity of $1.3 trillion for brands who make their sustainability credentials clear.
Provenance helps businesses display sustainable sourcing and ethical practice all the way through their supply chain, by tracing the origin and history of their products. Each product journey can be shared with customers to display the social and environmental impact of the production. This level of transparency helps build a trusting relationship with the customer, whilst monitoring and driving fair, sustainable production methods.
According to the International Labor Organization, there are nearly 25 million trapped in forced-labour around the world, with 47 percent of them in the Asia-Pacific. Companies who operate around the world, such as food and beverage companies, are now coming under pressure to address the risk of forced labour in the countries where they work.
Coca-Cola has teamed up with the US State Department and a number of crypto organisations to enforce labour rights through blockchain, by creating a secure registry for workers and their contracts.
The evidence chain created would ensure clarity when employers do not honour their workers’ rights and would make it easier for them to be held accountable.
The project is still in the early stages but Coca Cola have committed to conducting 28 national studies on child labour, forced labour and land rights for its sugar supply chains, before 2020.
Around 2 billion people globally do not have access to a bank account or a financial institution. It’s easy to forget how hard this can make everyday tasks we often take for granted. How does your employer pay your wages? How do you pay your bills? How do you keep your money secure?
Since 2015, the Finnish Immigration Service has been giving asylum seekers without bank accounts prepaid Mastercards instead of cash support, linked to a unique digital identity stored on a blockchain.
The MONI card provides these unbanked people with a way to access and manage monetary transactions, opening up huge opportunities, including employment, providing a way to pay bills, and even a way to receive direct deposits.
This system is hugely empowering for refugees and allows them to advance without barriers.
Climate change and environmental awareness are a hot topic around the world. Towards the end of 2017, the Australian government granted $8 million to Power Ledger to trial the use of blockchain-powered energy and water systems in the City of Fremantle.
The project is the first step to assessing how blockchain technology can be utilised in cities to integrate these systems and will use low-cost, low carbon methods, including solar and electric vehicle charging stations.
The Australian start up hit the headlines in early April 2018 after partnering up with Greenwood Solutions to install solar across strata units in Melbourne, where on-site renewable energy generation and peer-to-peer trading “will allow residents to maximise the value of their renewable energy investments, while sharing the low-carbon benefits with their neighbours.”
Blockchain is progress but sustainability is still just out of reach
Whilst blockchain might have great capacity to improve the transparency of supply chains, reduce inequalities and empower people in need, a lot of electricity is currently required to process transactions. To address a demand by business, innovators from top institutions and tech companies are now attempting to develop green blockchain innovations, with some claiming they can drive electricity consumption to almost zero. If this were achieved it could be the next step in making Blockchain truly sustainable.