Blockchain technologies have the potential to help the international community reduce transaction costs, lower the risk of fraud, control financial risks and protect beneficiary data amongst many other advantages.
Blockchain is a distributed ledger technology that allows for storing data in a secure, transparent, auditable and efficient manner. It can unlock significant efficiency gains and savings by reducing the need for third-party intermediaries.
Five Blockchain Experiments at UN Agencies
The UN Innovation Network, co-chaired by UNICEF and UNHCR, meets quarterly to share learnings and advance discussions on innovation across agencies. Recently, they released a blockchain working paper highlighting five ways that United Nations agencies are experimenting with blockchain distributed ledger technologies in humanitarian relief and international development programs.
1. Blockchain for Food Assistance to Refugees at WFP
As part of World Food Programme’s “Building Blocks” project, 10,000 Syrian refugees in Jordan are able to redeem cash-based transfers on a blockchain-based system. The seamless integration of the blockchain into existing technologies allows WFP to use the same process- resulting in no change in the beneficiary experience and disruption to food assistance programmes.
Blockchain allows WFP to virtually eliminate transaction fees paid to third-party financial service providers during the cash transfer process and the project will pay for itself within the first year. Financial risk is also reduced and beneficiary data protection improved. By the end of 2017, WFP aims to scale the project to reach 100,000 Syrian refugees with full roll-out to all Syrian refugees assisted by WFP in Jordan in 2018.
2. Blockchain to Promote Gender Equality at UN Women
In partnership with Innovation Norway, UN Women is exploring the potential and risks of leveraging blockchain technology to promote gender equality and women’s empowerment by (re)building a civil registration and economic identity and sending and receiving digital assets directly.
UN Women will be investing in a few pilot initiatives over 2018 in partnership with other UN agencies and the private sector. To identify and test the most competitive solutions, UN Women hosted a live simulation blockchain lab in January 2018, which builds on UN Women’s previous hackathon at the Katapult Future Fest.
3. Blockchain to Store Education Records at UNICEF
UNICEF is investing in the South African start-up 9Needs to develop the open source digital identity and personal information platform “Amply”. The system uses blockchain infrastructure and smart contracts to strengthen the registration, contracting, information and management systems of early childhood development programs. It helps children access services such as education, health care, social benefits.
The data stored on Amply includes metadata (e.g. date, time, location) and “seals” of guarantee making it easy for external authorities to check the validity of the data, without accessing the data itself. UNICEF uses the data generated to tailor its services to be more predictive, precise, personalised and preventive.
4. Blockchain to Increase Aid Transfer Efficiency at UNOPS
In 2016, UNOPS launched a project to explore how blockchain can be used to increase the efficiency of aid transfers, specifically of
- Entry to the international aid community,
- Intra-agency transfers, and
- Transfer to the end beneficiaries.
Especially the second area offers tremendous opportunities for partnerships among UN Agencies. To identify possible technology partners, UNOPS launched an RFI for blockchain-based international assistance, which received over 70 responses that have been made available to all UN Agencies.
UNOPS is looking to establish a proof of concept in five priority areas, i.e. payments, identity, data storage, supply chain, funding platform.
5. Blockchain to Reduce Remittance Costs at UNDP
Currently the average cost of remitting money to Serbia is around 8% and there is no transparency on how and where the money is spent. In Serbia, UNDP and AID:Tech are using blockchain technologies to issue a digital identity to beneficiaries and thereby enable them to receive remittances directly. This is expected to reduce the cost of individual transfers by more than 2%.
Instead of sending cash, the diaspora will be able to purchase vouchers for items such as food, electricity and more. These vouchers will be sent directly to the beneficiaries digital identity, which they can use at the point of sale or on a mobile app to pay for their electricity, gas, groceries etc.
Thanks for the article, Wayan!
I think the current headline is wrong, it says “Five Examples of United Nations Agencies Using Blockchain Technology”: Should be “Five Examples of United Nations Agencies spending funds to experiment with Blockchain Technology” 🙂
At least, it shouldn’t imply that these over-hyped technologies are actually in use.
Slowly the world will separate the distributed ledger technologies, as a platform for a number of uses, from the hype around its uses for digital coins and tokens. Think of blockchain as a factory that could be used to produce bombs or medical devices. The factory (blockchain, or other DLTs) can be put to good or bad uses. The EU is taking the technology seriously. See: http://europa.eu/rapid/press-release_IP-18-521_en.htm for the announcement of the EU blockchain observatory. DLTs will have a number of uses, for example in supply chain tracking and accountability, and financial transactions, as we work through the research and development stage.
> Think of blockchain as a factory that could be used to produce bombs or medical devices.
“Produce”?
I will politely suggest that this is an exaggeration of its impact. I would suggest people to refuse a mental representation of the technology that elevates it to a physical state, since its existence is digital or bureaucratic.
Think of it as a new level of non-productive bureaucracy that complicates the flaws of democracy and transparency already present. It also seeks to solve them (usually by ignoring existing alternatives) — but these are all claims thus far.
While I look forward to the more serious and lesser hyped solutions, I want to see real evidence of the value and productivity of blockchain before making statements on its usefulness.
@Benjamin You are entitled to your opinions but please do not exaggerate and minimize at the same time. These digital venues of the Internet ecosystem are as real as are iron and concrete when it comes to humans building things that impact on how we do what we do, for better or worse. Distributed Ledger Technologies (DLTs) are just another digital platform that has potentially good (and bad) uses. If you are suggesting not running head long into applications without research and development, and without monitoring and evaluation, I fully agree. If you are suggesting not doing due diligence research and development at all, why would you suggest that? .
@Sam – I think you didn’t read my last paragraph 😉
@Benjamin, research on blockchain’s usefulness, outside the coin/token area, is precisely what is going on in some quarters, but most experimentation will have to be done “in the field” since usefulness depends on how an application works in practice, and not in a lab. The challenge around evidence is sorting out the efforts with promise of a deliverable (efforts that succeed or fail) from efforts that are little more than scams of investor funds that use the language of blockchain (and coions/tokens) and ICOs to grab the money and run. After enough people lose their investments the focus will be, as you call for, evidence based projects and investments.
> usefulness depends on how an application works in practice, and not in a lab
I think we agree then., and “overhyped” is my subjective addition, which I think you disagree with.
I asked for the headline to clarify that this is about *experimenting* with blockchain, not using it. I think that it would be more appropriate if we did not jump to any conclusions at all, not least overstate things and mix up experimentation with actual use. As you said, lots of people are losing their investments, so it’s rather “inappropriate” to repeat the same mistakes with development/aid budgets.
@Benjamin, Nope, I don’t disagree with “overhyped” I have earlier written, elsewhere, that if I had a business picking up dog poo in the parks, I could buy an exchange listed company, change the name to Blockchain Canine Environmental Services (ticker: BCES) or run an ICO, and fleece investors out of considerable money. High on Hype and low on Integrity, that is about where we are. Your caution against “experimenting on human subjects” is well taken, but we do need field trials on the most promising uses since lab rats won’t work.
@Sam
The system unfortunately doesn’t support another layer of nested comments 🙂
Thanks for sharing the dog poo analogy! It’s spot on! When thinking about (blockchain) hype as a culture, then the antidote or counter-hype would be counter-culture. This aligns well with humor, art and other forms of criticism.. found out about a book yesterday called “Attack of the 50 foot blockchain”, seems like just the sort! 🙂
Missing: #UNFCCC for climate. Check out https://www.youtube.com/watch?v=UOANny6i0QM.