There has been a lot of hype about blockchain technology – in particular, its potential to transform how humans transact, which could fundamentally redefine how business, governments, and society operate. Despite this hype, it is still a nascent technology with considerable challenges that need to be overcome.
As the technology matures and is applied across a wider set of sectors and systems, there is both a challenge and an opportunity to realize blockchain’s potential – not just for finance or industry, but for people and the planet.
This opportunity comes at a critical juncture in humanity’s development. As a result of the “great acceleration” in human economic activity since the mid20th century, which has yielded impressive improvements in human welfare, research from many Earth-system scientists suggests that life on land could now be entering a period of unprecedented environmental systems change.
Fortunately, an opportunity is also emerging to harness blockchain (and other innovations of the Fourth Industrial Revolution) to address six of today’s most pressing environmental challenges that demand transformative action: climate change, natural disasters, biodiversity loss, ocean-health deterioration, air pollution and water scarcity. Many of these opportunities extend far beyond “tech for good” considerations and are connected to global economic, industrial and human systems. Blockchain provides a strong potential to unlock and monetize value that is currently embedded in environmental systems, and there is a clear gap within the market.
In the first quarter of 2018, for example, 412 blockchain projects raised more than $3.3 billion through initial coin offerings (ICOs). Less than 1% of these were in the energy and utilities sector, representing around $100 million of investment, or around just 3% of the total investment for the quarter.
At present, have been identified more than 65 existing and emerging blockchain use-cases for the environment through desk-based research and interviews with a range of stakeholders at the forefront of applying blockchain across the industry, big tech, entrepreneurs, research and government.
Blockchain use-case solutions that are particularly relevant across environmental applications tend to cluster around the following cross-cutting themes: enabling the transition to cleaner and more efficient decentralized systems; peer-to-peer trading of resources or permits; supply-chain transparency and management; new financing models for environmental outcomes; and the realization of non-financial value and natural capital.
Harnessing blockchain technologies to drive sustainable and resilient growth and a new wave of value creation will require decisive action. The opportunities that blockchain offers need to be developed and governed wisely, with upfront
and continual management of unintended consequences and downside risks. A variety of measures will be needed, from ensuring compliance with privacy rights, improving security and clarifying accountability in case things go wrong, through to establishing standards for minimizing energy consumption.
Establishing new global platforms or accelerators focused on creating a “responsible blockchain ecosystem”, rather than just incubating specific projects, would be a valuable and much-needed next step.
Finally, today’s hype surrounding blockchain can lead to the temptation to try to use blockchain to solve everything. A reasoned and structured approach is needed to help practitioners assess whether and how to deploy blockchain for delivering new environmental solutions.
Meet and share your experience with professionals engaged in harnessing the potential of Blockchain for international development at the first Blockchain for Development Forum to unfold in Southeastern Europe. The event is scheduled for November 7th, 2018, and is due to take place at Opera Plaza Hotel in Cluj, Romania.
Read and download the report Building Block(chain)s for a Better Planet.
Original source: World Economic Forum
Published on 14 September 2018
