What is this buzz word all about? Is it something as revolutionary as some people are alluding it would be. In order to understand how revolutionary an idea is or could be, the best way to check is to look at the impact it would bring about and to see how many people will be impacted. So what is blockchain anyway? Blockchain is a digital ledger or database that is distributed across a network of computers. Each block in the chain contains a record of transactions, and once a block is added to the chain, it cannot be changed or deleted. This makes blockchain a secure and transparent way to store data, as each transaction is verified by the network of computers and cannot be tampered with. It is practically impossible to go back and edit records because of the very chain that is a central part of this technology, and in order to actually go out and change something, one would theoretically need to go back and alter the records in all the previous blocks in the chain as well. This makes blockchain a reliable way to store data and conduct transactions, without the need for a central authority or intermediary.
Blockchain technology has been making headlines since its inception over a decade ago, and for good reason. With its decentralized, secure, and transparent nature, blockchain has the potential to revolutionize the way we conduct transactions and store data. In recent years, we have seen an increasing number of real-world applications of blockchain technology across industries. I want to take this opportunity to talk about some of the innovations already undergoing in big or small way which could potentially change a lot of things for the industry. So let’s dive in the use-cases:
Supply Chain Management
One of the most promising applications of blockchain technology is in supply chain management. Blockchain can be used to track goods from their origin to the end consumer, ensuring transparency and accountability at every step of the way. Walmart, for example, has implemented a blockchain-based system for tracking food products from farm to store, which allows for faster recalls in the event of a food safety issue. This is especially close to my heart because of the amount of global food wastage that’s happening right now.
According to FAO’s report on The State of Food Security and Nutrition in the World (SOFI), the number of people affected by hunger rose to as much as 828 million in 2021, an increase of about 46 million since 2020 and 150 million since 2019. In all, an estimated 3.1 billion people do not have access to a healthy diet.
Meanwhile, according to FAO’s State of Food and Agriculture (2019) report, around 14 percent of the world’s food (valued at $400 billion per year) continues to be lost after it is harvested and before it reaches the shops; while UNEP’s Food Waste Index Report shows that a further 17 percent of our food ends up being wasted in retail and by consumers, particularly in households. According to FAO estimates, the food that is lost and wasted could feed 1.26 billion hungry people every year.
To put things in perspective, we need to have a look at this chart showing Pakistan’s GDP over the years along with few others:
Blockchain can also be used for identity management, as it offers a secure and decentralized way to store and share personal information. Estonia, for example, has spearheaded and implemented a blockchain-based system for managing citizen identities, which allows for secure and convenient access to government services. Following suit, many other countries can easily benefit from such identity management solutions. This is going to be particularly useful for countries where there’s a relatively bigger influx of immigrants year over year, and cases where the birth days have consistently been very high.
Blockchain can be used to create secure and transparent voting systems, which could help to eliminate fraud and increase trust in the democratic process. Voatz, a blockchain-based voting platform, has been used in several US elections, including the 2020 Democratic primaries. This is uniquely relevant because according to the EIU Democracy Index 2022, the world we live in has almost 65% of nations following democracy in one form or another and approximately 63% of the world population fall under these nations.
Banking and Finance
Blockchain technology is being increasingly used in banking and finance, particularly in the area of cross-border payments. Ripple, for example, has developed a blockchain-based platform for fast and secure international money transfers, which has been adopted by several banks and financial institutions. With the world becoming more global, and the restlessness created by the failure of some mainstream banking institutions (again), it piques the interest of many whether we need to think about banking and finance in a different light now than how we have been made accustomed to see it.
Blockchain has the potential to transform healthcare by providing a secure and efficient way to store and share medical data. This is another tricky area to work with because of the need to keep things confidential, but considering how the technology basically opens itself to allow the users to keep all the information confidential within the system, this has a lot of scope. In fact, in the United Arab Emirates, the government has implemented a blockchain-based system for storing and sharing medical records, which allows patients to access their data from anywhere in the world.
Blockchain technology can also be used in the energy sector to create a more efficient and decentralized grid. Power Ledger, a blockchain-based platform, allows consumers to trade renewable energy credits and manage their energy consumption in a more sustainable way. This is going to be more and more relevant as the world maneuvers around its way into renewable energy resources and thought leaders and business executives both focus on clean energy initiatives.
Blockchain can be used to streamline the real estate transaction process, by providing a secure and transparent way to store and share property data. Propy, for example, has developed a blockchain-based platform for buying and selling real estate, which eliminates the need for intermediaries and reduces transaction costs. It’s a long way before it becomes widespread but once it becomes more common, governments, businesses and individuals will see their visible bend towards this technology for its inherent advantages over the legacy systems.