Guest Articles

September 17

Akhtar Badshah

The Blockchain Experiments Have Begun: Here’s What They Could Yield for Business and Development

Editor’s note: This post is part of NextBillion’s series, “High Tech Buzzwords: Hype or Real Impact,” — one of several topic areas we’ll be covering through special series this year. Click here for more details on our 2018 series.


In April I wrote a blog entitled Bending the Arc of Humanity – Effective Development of Exponential Technologies to Serve Mankind, in which I looked at how exponential technologies have the potential to positively impact humanity – if those working at the bottom of the economic pyramid will take the lead to become experts at utilizing it. But one technology I did not touch upon was blockchain. One of the most prominent uses of blockchain in recent times is cryptocurrencies, of which it is the underlying platform. However, due to the great volatility of cryptocurrencies and numerous other challenges, the overall community does not seem to have fully bought into the foundational technology of blockchain.

The blockchain platform and its underlying technologies can be complicated and hard to understand, but the simplest explanation is that they simply make up a new type of data application or ledger – one that can store indisputable data, which can then be directly shared without requiring a central administrator. This contrasts with traditional databases, which have one single administrator that owns and controls the data. The new “protocol” or design of the blockchain enables transactions directly between two or more parties, authenticated by mass collaboration and powered by economic incentive and self-interest. It is enabling the democratization of data, money and eventually, power. Additionally, blockchain transactions are based on cryptography, which makes them inherently more secure than any traditional database or system today.

What is important is that this technology can impact the lives of poor people around the world in multiple ways. Having such a secure platform that also increases transparency lends itself to many uses, such as secure identities, financial transactions, tracking and managing of payments, and better governance. Here are a few organizations that are putting blockchain to use in interesting ways.


Blockchain’s Impact in Action

BanQu is an innovative for-profit / for-purpose blockchain-as-a-service software company that is using the blockchain platform to create economic identity for poor people. Nearly 2.7 billion people worldwide do not have access to credit and other services by banks or other formal financial institutions, due to lack of an economic identity. This identity consists of the digital or electronic credentials that define a person’s history of economic interactions in the world economy. Lacking a credit history or verifiable economic identity, these “unbanked/underbanked” individuals (mostly refugees, the displaced and the world’s poorest) are excluded from the global economy. As a result, the poor and the disenfranchised stay poor and disenfranchised, while billions of dollars of aid continues to flow to conflict zones, areas struck by natural disaster and regions of extreme poverty, with no solution in sight… until now.

Similarly, in 2017, Microsoft, Accenture and Avanade unveiled a new software tool that combines biometric data (like a fingerprint or an iris scan) and blockchain, to create a permanent identity. This is a boon for people from countries torn apart by war and political chaos, which make it difficult or impossible for them to prove their identities. This tool is still in its development phase, but blockchain technologies give it the promise of being both secure and transportable.

The UN World Food Programme is another organization leveraging this technology; it’s testing out a blockchain system to help hundreds of thousands of Syrian refugees at the Azraq camp in Jordan. The system combines biometric data, credits stored in digital wallets and direct payments to food retailers. It also sidelines intermediaries, both protecting sensitive data and saving costs.

Along the same lines, The Building Blocks project provides mobile retina scanning units to take biometric data from refugees, who are then given digital wallets with credits to buy food. Accredited local retailers also have iris scanners installed, to ensure that the wallet belongs to the person who brings it to their store. The credits are downloaded from the wallet to the retailer, who get reimbursed every month directly from the food program without the need for banks. The project started with 10,000 refugees and is being expanded to cover 500,000. Once full coverage is reached, the savings in bank fees is forecast to be $150,000 per month.

Another fascinating example is that of the Swiss-based Porini Foundation, which has set up the Sustainability Chain – an Ethereum-based blockchain designed to help others achieve the UN’s Sustainable Development Goals. The first user is the Swiss-based International Union for Conservation of Nature, which will utilize the blockchain to administer its Green List of global conservation areas. The scheme encourages and supports the creation of new protected conservation sites around the world.


Promising Innovation: A Work in Progress

Despite all of these thrilling cases of blockchain’s great potential to offer secure payment systems, increase transparency, reduce fraud, eliminate middlemen and provide secure and portable identity, the technology is still indeed in its infancy and may not be suitable yet for all applications. Governments also have a major role to play in ensuring proper legislation to allow for the platform to function effectively. BanQu as a startup shows what can be done when barriers are broken down.

The blockchain platform will continue to grow. But it is vital that the business and development sectors take part in the experimentation, so they can learn about and eventually propel the scaling of these applications.


Top image: At the Azraq camp in Jordan, where blockchain technology has been implemented to help refugees purchase food using biometric data. Image credit: WFP.


Akhtar Badshah is founder and chief catalyst at Catalytic Innovators Group and distinguished practioner at University of Washington, Evans School and School of Business.




Base of the Pyramid, blockchain, cryptocurrency, digital identity, financial inclusion, innovation