Nov 19 2016
How Blockchain is changing the world
Diamonds, Voting, Music, Energy, Pork. If you can think what’s common between them then think again. All these are being affected by blockchain technology in one way or the other. All these things can be tracked using blockchain technology today. While bitcoin has received the lion’s share of attention since its conception, recently the blockchain – the distributed public database used to record bitcoin transactions has just begun entering the spotlight for enabling some important capabilities outside of bitcoin.
Distributed cloud storage – Current cloud storage services are centralized, which means the users have to place their trust in a single storage provider who controls all of your online assets. On the other hand, with the blockchain this can become decentralized. For instance, storj is beta testing cloud storage using a blockchain powered network to improve security and decrease dependency.
Diamonds – Diamonds to a notable degree are traceable as the uncut ones have unique physical characteristics and the cut ones are typically laser etched with a tiny serial number. Recording each movement of such valuable items allows insurers to identify fraud and international bodies to ensure that trade in diamonds is not funding conflicts. London based start up Everledger is using blockchain to prove the provenance and ownership of diamonds recorded in its ledger.
Supply Chain communications - Walmart is trying blockchain’s distributed ledger to identify the sources of poisonous/stale food. By issuing digital receipts for the food they can identify everyone in the food supply chain right from the original location of the food through to the inspectors and shipping companies. If everything passing through a particular warehouse is making people ill then it can identify that warehouse and take necessary steps. Presently Walmart is only using blockchain to track both pork and a “packaged item” in China and US respectively.
Marketing - At Shanghai Fashion Week in October, fashion label Babyghost worked with Vechain, a blockchain platform, to let customers “verify” a selection of handbags. Moreover, customers also scan the tags using their phones to find a “story” of the product – where it’s from, who previously modelled it, and so on. This way Babyghost is bringing digital experiences to their consumers and enabling them to build up a personalized connection with the products they own. Blockchain thus is being used to advertise a product in a much more “authentic” way that doesn’t come off as marketing.
Digital Voting - In 2014, Liberal Alliance, a political party in Denmark, became the first organization to use blockchain to vote. Using blockchain, a voter could check that her or his vote was successfully transmitted while remaining anonymous to the world. In countries where voter turnout is still very low, distributed digital voting may represent a way to enfranchise non-participants.
Power and Energy - Siemens and the New York start up LO3 Energy are collaborating in the field of innovative microgrids. In April 2016, the world’s first blockchain managed energy trading transaction took place in Brooklyn, New York. The owner of a solar roof panel sold excess energy (a few kilowatt hours) to his neighbour using a smart contract of the Ethereum blockchain. This happened with the Brooklyn microgrid which is managed by LO3 Energy.
Music Industry – Musicians like 100 years ago still go through the archaic system of intermediaries losing up to 86% of the proceeds from their music. However, now blockchain could transform publishing, monetization and the relationship of the artists with their communities of fans. Music can be published on the ledger with a unique ID and time stamped in a way that is effectively unalterable. This can solve the historic problem of digital content being downloaded, copied and altered at the leisure of the users. Composers and artists will no longer need to go through the intermediaries (purchasing platforms and financial brokers) who usually take a hefty cut of the revenue and can get directly compensated every time their songs are played. Companies like Pledge Music have published a comprehensive blueprint for the Fair Trade Music Database, a globally decentralized blockchain based ledger that can solve the problems of ownership, payments and transparency.
Development Sector – Start Network is developing a prototype to explore how a number of NGOs in different countries can use the blockchain to take coordinated, fully transparent decisions within a sudden-onset emergency scenario. Eventually, they hope to evolve the prototype to support smart contracts. Red Cross is also exploring how the blockchain can support the process of the transparent allocation of funds in case of a disaster.
Today, blockchain is yet to mature but it has shown tremendous possibilities. It remains to be seen if the expectations can live up to reality. But, in many ways it is quite reminiscent of internet in the mid 90s. Not many people would have predicted its significance back then. That is where we stand today with blockchain. The power of this transformation will become more compelling as the hype settles down and we begin to unleash the possibilities.