Blockchain in Humanitarian Aid

Recap: What is blockchain?

The simplest definition of blockchain is that it is a persistent, transparent, public, append-only ledger. Blockchain operates by creating distributed ledgers that can be shared and updated in real-time across a group of individuals without the need for any party to trust one another. Every input or transaction is cryptographically verified, and through a process of seeking distributed consensus, it becomes part of a permanent record which constitutes an effective proof-of-ownership and existence that can be scrutinized by those who have permission. Like a traditional accounting ledger, nothing once posted on a blockchain can be deleted — it can only be reversed with a new transaction. This algorithmic layer is much more efficient and tamper-proof than traditional notaries and has implications to cut costs (while increasing transparency) of regulatory compliance and controls record-keeping.

Although it was created for Bitcoin, its potential extends far beyond cryptocurrency and has the potential to impact every industry where there is a need for an intermediary or trustworthy record keeping.

Today’s Challenges

To date, an unprecedented and ever-increasing number of people were forced to leave or flee their homes due to conflict in 2016. Global displacement around the world has reached an estimated 65.3 million individuals, with over 21 million refugees crossing borders to escape considerable hardship. They have left their homes, their livelihoods, possessions and their networks. They place their lives in the hands of humanitarian aid programs to provide them with appropriate resources to build their life anew. However, without proper identification, they are often unable to access and claim resources available to them.

Tomorrow’s Opportunities

Blockchain allows us to imagine a world where aid is able to reach these individuals faster, where refugees can store their identity on uncorrupted systems, where property and title rights are secured, where education is not limited by distance and where transparency and accountability are a given in humanitarian aid. Blockchain re-imagines past barriers in humanitarian organizations and groups in three primary ways:

Accountability and Transparency in Aid: Humanitarian efforts are often harmed or limited by the lack of transparency between relief parties. In the event of disaster situations, there is a need for transparency, seamless interoperability, and information exchange in real-time among helping parties that only a distributed network can provide. Blockchain, therefore, offers an independent system of record that could be key to providing quicker and more effective help for people affected by crisis and emergency by tracking funding and aid.

Identity Verification: By combining the decentralized blockchain principle with identity verification, a digital ID can be created that would act as a digital watermark. This would not only allow enabling individuals to access resources to start their lives anew but would also enable the ability to trace and report all stages of migration.

Property and Assets: Building on from the previous point, blockchain enables individuals to lock and secure tangible and intangible assets that are recorded onto the blockchain into “smart property” whose digitised ownership can be controlled through automated contracts. This can secure land rights, homeownership and other forms of digital property such as data.

Case Studies

U.N World Food Program: Financial Aid

In the international aid sector, several experiments are being conducted to distribute aid funding through the use of blockchain to improve how aid is disbursed. For instance, the U.N world food program piloted a project in 2017 that creates virtual accounts for refugees and uploads monthly entitlements that can be spent in the camp’s supermarkets. Countries like Finland have also similarly used blockchain, providing a card called MONI as a means to transfer value like a debit card - transactions are recorded in public allowing immigration services to keep track of cardholders' spending.

Republic of Georgia: Securing Land Rights

According to the world bank, only 30% of the world’s population has legally registered title to their land. The implications of blockchain in securing land rights will prevent the insecurities and injustices that are part of these land registered. However, in partnership with Bitfury Group, the republic of georgia is one of the first national governments today to use the blockchain network to validate property-related government transactions.