Many sectors are already exploring the potential applications of Blockchain, a technology that according to experts could have an impact comparable to that of the internet. Beyond the famous cryptocurrencies, there is no longer any doubt that the uses of this technology can improve society, and several social enterprises are demonstrating it through interesting projects.
News referring to this technology is becoming increasingly widespread, which piques the public’s curiosity and feeds companies’ imaginations. However, beyond material ambitions, blockchain offers an entire world of possibilities to social enterprises to make a positive impact on the world.
Transparency is the key
Transparency is one of its strongest features. “The technology at the heart of bitcoin and other virtual currencies, blockchain, is an open, distributed ledger that can record transactions between two parties efficiently and in a verifiable and permanent way,” explained Marco Iansiti and Karim R. Lakhani in an article about blockchain for Harvard Business Review. This advantage may be the foundation for important social projects.
Such is the case of the BitGive Foundation start-up, headquartered in California, which has launched the GiveTrack platform. With this blockchain-based system, bitcoins can be donated to charitable causes and these donations can be tracked in real time. Thus, it reduces the cost of international transfers, ensuring that the funds will reach the desired recipient, and users are permitted to see how their donations are spent.
Reliable, secure transactions without intermediaries, and subject to reduced fees: What positive impact can this advantage bring to the third world? The answer is obvious just by looking at the figures: “In 2016, emigrants working abroad sent an estimated $442 billion to their families in their home countries,” explained Nir Kshetri, professor at the University of North Carolina, in an article for the World Economic Forum. “This global flow of cash is a significant factor in the financial well-being of families and societies in developing nations. But the process of sending money can be extremely expensive.”
Blockchain technology makes these transactions cheaper and significantly reduces the fees, opening up an entire world of possibilities for several sectors, such as health. “Most people in the third world lack health and life insurance, mainly because it is very expensive in comparison to their income,” explained Kshetri. “The blockchain systems work online and verify the transactions, thus avoiding fraud and drastically reducing costs for insurers.”
Mexican company Consuelo has figured out a way to use distributed ledger technology to offer a micro-insurance service, backed by the Mexican mobile pay company Saldo.mx. The service allows users to easily access life and health insurance. The micro-insurance system covers people that are not integrated into the formal economy, and covers their families in the United States and other areas of Mexico.
The unique identity
If there is a field where this technology can really benefit millions of individuals across the globe, it’s in identity management. The advantage of not having to rely on documentation to prove one’s identity, and to be able to do so securely will have many applications and facilitate people’s relationships with their home countries’ administrations.
In the case of refugees who live in foreign countries, having an official identity is vital for normalizing their life and accessing the financial services they need on a day to day basis. In Finland, start-up MONI has created a card that is linked to a unique digital identity, based on blockchain technology. Thanks to this card, the person taking refuge can purchase products, pay bills and receive direct deposits from their employers. Each transaction is registered in a very well-protected public database that allows the Immigration Service to monitor card holders and their movements. In this way, the security and legality of the system are guaranteed. MONI is now working throughout Europe, but has yet to expand beyond European borders, yet an ambitious future objective has been set to provide everybody normalized access to the financial system. Blockchain can improve their lives and give them opportunities they currently lack.