Blockchain and cryptocurrencies are a hot topic that arouses great interest in the financial and economic world. However, beyond the financial speculation that surrounds it, what are the other possible uses of this technology?
The blockchain: basic principle
We all know what blockchain is, but let’s recap its basics. Blockchain is an emerging technology that allows you to create decentralized networks made up of several computers to securely record the transactions that take place on them. In other words, each computer has access to all the data contained in this network and can make changes to it if it has the permission of other users (or minors). This system allows us to avoid having a central authority in charge of managing everything – a single point of failure – and to protect our data from hackers or attempted corruption.
It’s also worth mentioning that Bitcoin (the first cryptocurrency) was born out of a similar idea: to create an alternative currency based on peer-to-peer payments without the need for a central authority such as the banks or governments involved; but there are many other possible uses of the blockchain that go beyond knowledge how much is a bitcoin worth or more generally, the use of cryptocurrencies!
Solving some NGO problems?
The blockchain would solve some of the problems of existing NGOs, such as their precariousness or their lack of transparency. It is decentralized which means that no entity controls it and this database is not stored on a centralized server. This makes it more difficult to hack and therefore more secure than traditional databases. It is immutable: once something has
been saved in the blockchain, it can never be modified or deleted (the only way to do this would be to create a completely new version of the database). Finally, since there is no need for a central authority to control access or change entries in the database (like a bank), everything will be logged automatically by everyone participating in this peer-to-peer network (making them all witnesses ).
NGOs discover this potential market
Even the NGOs themselves have discovered this potential market. Some of them, like Unicef or the World Food Programme, they are already experimenting with the blockchain to improve its transparency. Others, like Greenpeace or Oxfam, use it to raise funds, manage donations and track the flow of goods and services they receive through their network of partners.
In November 2018, during the G20 meeting in Buenos Aires (Argentina), a group of countries led by France called on international development organizations to use technology more effectively at all levels: from fundraising to aid distribution and to monitoring. Blockchain technology could serve as a solution to the three problems mentioned above: transparency would be increased by eliminating intermediaries; fundraising would become easier with more advanced donor targeting tools; finally and most importantly, the distribution of aid could be improved through automated monitoring systems that enable NGOs working together on a common platform (such as UBS) to reduce costs while ensuring greater efficiency and effectiveness in their operations.
Can blockchain change the face of charities?
When it comes to blockchain, it is often forgotten that not all of its applications are intended for finance and cryptocurrencies. Blockchain technology is a decentralized trust system that can also be used to store data and make it accessible to all.
This is the case of NGOs, who are starting to see the potential benefits of this technology: it allows transparency of donations by avoiding financial fraud or misuse of funds by organizations. Deciding whether or not to use blockchain, however, requires understanding the different ways it can help your organization work more efficiently, and whether those benefits outweigh the disadvantages such as increased costs or reduced efficiency.
In conclusion, we can say that blockchain technology offers many possibilities for the future of charity. It’s not a new technology, but its popularity has increased recently due to its decentralized nature and encryption capabilities. The main advantage of this system is that it allows users to transact anonymously, which means less risk of fraud or identity theft when donating online.
Posted 01/24/23 17:32