Expert panelists at Consensus 2019 discuss blockchain’s promise as an inclusionary technology producing broad social benefits.
By Alissa Fleck
Since its inception, a grand and idealistic vision of blockchain as a technology of financial inclusion has often fallen short of the reality. But not always, and maybe not for long. Last week, at Coindesk’s Consensus 2019 conference, a panel of experts discussed the tangible ways they are using, or moving toward implementing, blockchain as a force for good in their respective fields.
Loretta Joseph, a blockchain consultant at the Organization for Economic Co-operation and Development, pointed to the use of digitally identifying children at high-risk for trafficking. This is a global problem with application beyond the OECD program in Vatican City that Joseph cited. Children around the world could benefit from the same application of the technology. Here in the U.S., for example, unaccompanied migrant children are often literally handed over to human traffickers.
Beyond providing immutable digital identification for every child, Joseph also said blockchain technology could be tokenized to help feed refugees.
Credit for the Unbanked
One of the biggest buzzwords at this year’s conference was “creditworthiness.” This was especially true for the panel on financial inclusion and impact.
Say what you will about your credit score, for many people the existing framework is a terrible assessment of creditworthiness, according to Vanessa Grellet, executive director at Consensys. She pointed to day workers in Pakistan who have worked for years and paid rent on time, but because they’re paid in cash, have little to no legal proof of their existence, let alone their financial history. There are millions of unbanked people in the world for whom the ability to record transactions on a ledger could be a valuable proof point of creditworthiness, Grellet explained.
Whether or not we agree with the current credit system, we in developed countries take for granted the ability to stake our credibility. Grellet said that social media could also play a role. “Everyone is on social media and has touch points,” she said. “That could be a better assessment of creditworthiness than the existing framework.”
Access to Renewable Resources
Anya Nova, a crypto economist at Power Ledger, pointed out that while these are good ideas, something more fundamental often gets lost in high-level conversations about implementing blockchain technology.
“You need a phone to participate in this economy,” she said, “but you need to be able to charge that phone. Access to electricity is a fundamental problem that needs to be solved first.”
Enter Power Ledger, billed as “an ecosystem of world-leading energy blockchain applications, that support a low-cost, renewable energy future.” The platform facilitates co-ownership of renewable infrastructure and further capitalizes the industry by “combin[ing] funds that have never agreed,” according to Nova.
“Whether it’s with nonprofits or retail or institutional investors, we can help close the gap between people who have electricity and those who do not,” she said.
Racehorses and Voter Records
Clyde Vandel provided the hyper-local, on-the-ground perspective of a member of the state assembly of New York, a state with a distinctly turbulent crypto past. If Wyoming is the most blockchain-friendly state, New York is perhaps the most hostile.
According to Vandel, use cases are being evaluated, although with regulatory rigor. As a member of the Gaming and Races Committee, Vandel said the same technology being explored to track kids in refugee camps could be used to track anything — including pricy thoroughbred horses in the high stakes racehorse business.
Vandel also championed the use of blockchain in elections. In the 2016 election cycle, he noted, more than 200,000 ballots went missing in Kings County. “We get calls from people who are angry because the state sends mail about their mother or grandmother to vote and that person died three or four years ago,” said the assemblyman, who represents District 33. “The Office of Vital Records does not communicate with the Board of Elections, but what if we put that on the blockchain?”
The jury is still out on such a move’s impact on the regularity of jury duty.
The Politics of Financial Inclusion
We all know the familiar reasons why we should implement blockchain, and there will be a thousand new reasons tomorrow. But there are still hurdles regarding the “how,” especially if the road to hell is paved with good intentions.
How do we ensure that those standing outside of our financial institutions, those who lack access to healthcare or credit, are included in the benefits of blockchain? How do we implement the technology and related policy without reinforcing social ills, and possibly even exacerbating them?
“If you opt in, you play by the rules,” said Joseph, of the OECD. “That’s the premise of decentralization. You don’t have to do it, but when you’re part of the network, you’re under those rules.”
“It’s important to be able to expose and educate those who are outside,” added Vandel.
As for how exactly to do this, the panelists did not have adequate answers. In fact, in would be shocking if they did. Information and material inequality are much bigger and much older problems than blockchain. Addressing them in the context of blockchain will require that we continue asking the right questions, which won’t always be the easiest ones.