How Blockchain Can Help Industries and People Alike

There is a new disruptive force in town and the world is paying attention. The Blockchain technology seems innocent enough, allowing the storing and processing sensitive information on a peer-to-peer network, accurately and transparently. It is encrypted, immutable, and decentralized; eliminating financial middlemen like the banks and other intermediaries for digital transactions activities (such as voting records and land registration).

It has the potential to fundamentally affect and fully automate every centralized process and activity.

Blockchain: Beyond the Bitcoin

Blockchain is still in its infancy. The ecosystems including the regulatory bodies are in the ‘understanding’ stage and only now begun to set up ‘working’ groups. However it is gaining traction. Adopting and embracing is distant.

Bitcoin is the most recognized and widely discussed Blockchain supported platform. However, the most promising enterprises in this field and most extensively deployed (yet not as widely known) is VeChain. It enables tracking, ensuring quality and authenticity of the product traded. The Government, and several industries including as diverse as the luxury industry, the agricultural industry have gone beyond ‘testing’. VeChain may be first off the block.

Most may not have heard of the Basic Attention Token which is disrupting the online advertising space. The platform enables synergizing rewards with the experience of the advertisement.

Tipping point

New technologies like Blockchain have the potential to address another fundamental need of developing of economies where inequality is growing. Key features of Blockchain is that it is decentralized, equable, secure, and transparent, thus empowering the citizens and making the process more democratic.

A World Economic Forum study predicts the early adopters like the financial industry will intensify their effort to embrace Blockchain. Almost every other industry is engaged to roll out their implementation of this tech as quickly as possible. Industries like the telecom, healthcare, energy, and retail are preparing the blueprint to catch up, and in some cases, innovate. Blockchain will influence our daily life much sooner than imagined.

The business is excited and is adequately prepared; tailoring the technology to arrogate, adopt, and fit to enhance the value chain for the stakeholders.

Not Mere technology

Blockchain enabled solutions will drive immense value. However, to seize the full potential and ‘experience’ benefits, we will need more than technology.

The best technologies are worth nothing without enablers. For Blockchain to be the force multiplier, the insight to vision the solution is the starting point. A broader understanding of and integration of the different components of the value chain is mission critical.

New technologies can be game changers only if they are supported by a robust infrastructure, an enabling ecosystem, and the advent and development of the complementary services. Lack of awareness, the absence of the adequate value chain (vendors and talent), the integration challenges and less developed platforms is a complication that needs to be addressed to capitalize on this technology.

Every rupee invested in creating the ecosystem and enablers of this value chain will be a multiplier. A good example is the internet. The multiplier benefits are beginning to kick in.

The government must focus on creating an enabling ecosystem to take advantage of the flourishing technological era that is upon us.

True Democracy

Democracies can largely benefit from Blockchain. Several of our political parties have blamed the EVMs for their electoral defeats. Blockchain can enhance transparency in counting as well as in verification and registration of voters, enhancing efficiency and equitability. The peer-to-peer network characteristic makes it open & ‘public’, protecting the owners and the transactions alike. The votes cast will be safeguarded, finally ‘electing’ the citizens as the master.

The middlemen, like the land registries (however reliable, and much trusted) will be nudged to enhance citizens’ experience and value as the Blockchain will ‘entitle’ the land owners, abolishing a convoluted and tangled web of title searches. It will build verifiable and validated owners’ ledgers and transaction history, eliminating the need for the ‘trusted’ state entity and reducing the cost to a fraction.

Unlimited opportunities, infinite potential

Citizens will benefit from distributed, multiple and smart networks, making it extremely hard to ‘down’ in a case of authoritarian government or illegal business practices. For example, a real estate purchased documented with a Blockchain smart contract cannot be deleted or hidden by any authority, making the owner secure from malpractices.

At the operations level too both the citizens and the governments will benefit from an optimally designed, better targeted and effectively delivered welfare schemes. The Blockchain technology will enable and foster a more transparent and ‘adult-to-adult’ (unlike the parent child) interaction between the citizens and the government.

The online retail industry is equally hopeful and no less excited. Blockchain based platform will holistically address security and eliminate fraud, arming both the customers and the retailers to battle fraudulent activities.

Early days, prime time is distant

While all this sounds breathtaking and indeed may be, let’s not pop the bottle yet. There are many constraints associated to the optimum utilization or even a modest application for widespread use. The everyday and common place benefits from Blockchain may be years away as the technology itself is neither robust nor mature enough to support voluminous transactions required to the tipping point.

Another concern and correlated to volumes is throughput (processing speed and the data transfer rate of the network). Then there is the challenge of confidentiality.

The other major roadblock, not technology related, is the lack or absence governance associated with technology that requires the regulators as the enabler and the society as the benefactor from the transactions. The bureaucracy akin to the ‘intercession of international standards’ itself will tie us up for years, the conciliation and consensus will break many hearts.

Regulators will haggle over what kind of data needs to be on the chain and what off it, the negotiation will center on the methodology and the process for validation of data. There will be heated debates around authentication and verification of transactions. Then there is the case of ownership; detailing who owns what part and who manages which segment is not an in-built feature of the system.

We would also need to recognize that though the technologies like Blockchain, AI, or Big Data undeniably have the potential to be profound, there is danger lurking. Like anything profound, it can be dangerous if badly conceived and hastily adopted. Then there is also the danger of miscarriage, the consequences of ‘false starts’, and early stage failure.

However, institutions and enterprises are collaborating and, indeed devising and formulating systems to engineer the much-needed throughput and evolving process to enhance confidentiality. Similarly the Government and the industry is moving beyond mere negotiation to a more meaningful dialogue for significant advancement and a widespread & consequential adoption of this extraordinary development.

Virat Singh