Future of trust in the hands of blockchain

 6 minute read

Blockchain has mostly been used in the financial sector, but it could also revolutionize many other sectors as well. For instance, the digital database can be a tool to facilitate transparency and trust in organizations and governments. Also, it protects ideas, patents, and other valuable assets from theft. The technology could even bring a wind of social change throughout the globe, allowing us to keep more reliable and less costly transactions.

Eradicating transaction costs

Blockchain has been the technology behind Bitcoin, the well-established digital currency, for almost a decade. It is a distributed database system consisting of a big number of blocks containing different transactions and the time they occurred. The blockchain makes transactions between involved parties more reliable and eradicates the involvement of a third party. In other words, the transaction involves only the customer and the company, thus generating more value at lower costs for the customer. The blockchain has been, and still is, a huge hit in the financial sector. It allows bank payments to be done quicker and cheaper for the banks and its customers.

When it comes to businesses, transactions through blockchain have a big advantage as they can be authorized automatically within seconds. It’s cost-efficient. Contracts and transactions are shared in a blockchain ledger that offers both transparency and accuracy. For example, blockchain can be used in the supply chain management, diminishing the need for close planning for each and every part of the chain. The expected results are smaller costs, better quality products, reduced risks and significantly fewer delays.

Blockchain can also solve trust problems sharing economies, like Uber and Airbnb, without presenting new monitoring third-party system. It allows direct contact between peers without a third party and could, therefore, be the foundation of a sharing economy that is truly shared and personal. With the promise of transparency and trust, blockchain will be the future of sharing circular economy.

Protecting Ideas
and Assets

According to Futurism, the blockchain “has the potential to completely change the way we think about money, social organization and trust”. It could act as a tool containing different kinds of value, like music or academic papers, for instance. This would be a great advantage for data, patents and ideas ownership since the blockchain can protect these assets from being stolen. The process of timestamp in the chain can serve as a reliable proof of who and when uploads the idea or product to the blockchain. Hence, it will be of great use to an innovator of any form of value because it makes the product safer, as well as, it creates trust between the author and the users of the product. A blockchain database of patents will boost the development of science and innovations, and can, therefore, benefit the whole society. Alexis Roussel, the co-founder of exchange service for Bitcoins – Bity –, states that the file will be safe as the first reference to it will exist in the chain even if it gets copied later. The blockchain could even be used when trading data or other assets. For example, the founder of the data could receive small payments when his or her data is being used by others.

The trust provided by the blockchain will also contribute to freelance community. The Australian company ChronoBank is developing a Recruitment Platform for freelancers with blockchain technology. On their website, ChronoBank states that their goal is “to make a difference to the way people find work and are rewarded for their labor – doing so within a decentralized framework and without the involvement of traditional financial institutions”. Naturally, the platform will also facilitate the transactions between freelancers and employers. This way, the blockchain frees global community from local economical input. The geography of freelancers and their employers will no longer matter. The blockchain will unite the world enabling global development and economical growth, as well as allowing people to reveal their potential seamlessly through any geography. As a result, we will see increased collaboration and innovation boost.

Potential Driver
of Social Change

We have already discussed that the blockchain is exceptional when it comes to creating a deeper sense of trust between parties involved in transaction of any kind, but it can also benefit the society. For its ability to transform an entire society and shift the social structure on a global level, some even call the blockchain as a general-purpose technology. For instance, the database can contribute to a voting system free of electoral rigging. Elections will be safer since they cannot be tampered with. Nevertheless, new regulations must be developed to enable all these changes.

There are three key benefits that government can experience when adopting blockchain. The first one is that it’s difficult for hackers to alter a blockchain as it has no central point and the database system is diffused between several computers. The second benefit is that it’s easy to access all transactions regarding a specific item. For instance, the blockchain provides the total transparency allowing to see transactions of a certain property. A third advantage is a security provided by the technology. The data is accessible to the public or made private in relation to the needs of the government. The network can also be made private but still allow citizens to check the information without even accessing the real data in the blockchain. According to Forbes Magazine, the Republic of Georgia stated in February 2017 that they will start using the blockchain in their property-related government transactions. The blockchain will be used by a national government for the very first time. It might be a beginning of the rapid change in the governmental structures worldwide supporting the development of the democratic rule.

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Insight Box

Blockchain is a useful tool when it comes to transactions of value between peers. There’s no need for a central authority, so the connection is faster and more reliable. Blockchain can be used in governments and companies to promote trust, transparency and security. Another way to use it is for protecting ideas and other assets of value, since it’s timestamp will always tell who was the first to upload the content to the chain. The database will also boost collaboration and innovation expansion.

Blockchain is changing several sectors in our society and generating trust between its users.

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