I’ve visited 25 countries and lived on three continents. Travel has taught me why the world needs blockchain. Blockchain is the technology that underpins bitcoin and other cryptocurrencies. It allows an exchange of value between two people anywhere in the world, without a middle man (like a bank or a third party like PayPal). Because of the decentralized nature of blockchain, it can’t get hacked the way a traditional financial institution or corporation can get attacked. That’s because a blockchain is supported by an anonymous network of computers in many different locations, rather than a server in one single location.
Another important feature of blockchain is that it is designed to be tamper-proof. I won’t get into a complicated explanation of why that is. A simplified version goes like this: the consensus mechanisms within a blockchain mean that if changes are made to any input in the blockchain, it will throw all the data off throughout the digital ledger. Any amendments will be super evident throughout the whole system and can be caught quickly and easily.
So back to the thrust of this article, which is that my wanderlust is part of the reason I’m convinced the world needs blockchain technology.
The millions of unbanked in the Philippines
I was born in the Philippines, in Makati, which is part of the capital city of Metro Manila. It’s a beautiful, vibrant country filled with intelligent, entrepreneurial people. A lot of people. We’re talking about a population of more than 100 million, spread out over about 7,100 small islands. It boasts an impressive literacy rate of 97% (people aged 10 years old and up) and because English is an official language, the Philippines is uniquely positioned to be a leader in Asia, if not the world. Yet it is a third-world country.
I understand that there are many reasons for this, including rampant corruption and overpopulation. But there’s something else at play here too. Nearly 90% of people in the Philippines don’t have a bank account. And yet about a third of the population has a cell phone. Because the ranks of the unbanked are huge, that means that so many intelligent, hard-working Filipinos ‘own’ property or a business that isn’t recorded anywhere. That makes it difficult to keep that property from being seized by someone else (government, shady operators, etc.). Leveraging the value of a small business to be able to grow it isn’t an option. Without the ability to formally quantify who the property or business belongs to makes keeping it in the family, or handing the reins to a designated third party, a challenge. Access to traditional banking services (micro-loans, estate planning, etc) would be a game-changer for millions of Filipinos. All you need is a smartphone, access to the internet and some tech savvy. Therein lies the disruptive potential of blockchain technology.
One of my most memorable semesters was the one I spent at a French university in Paris (you can find out which one by checking out my LinkedIn profile, but I’m not going to name it here). Even though I’d made arrangements to secure my spot from Canada, I was still required to register in person when I arrived in France. Sounds simple enough, right? Wrong.
I showed up and waited in long lineups over three days. Twice I was told they couldn’t locate my information. And when I presented a printout of my school records from Carleton University in Ottawa, there was a lot of confusion about the documents which were in English and were, back in 2000, on paper and could have been forged.
Given the immutability and security blockchain technology can provide, it’s easy to see how this could be used for educational documents, health records, patents, etc. There are already big name companies like Sony and IBM working on this kind of encrypted digital student record application for blockchain technology. It could eventually be used to track, manage and securely share graduation certificates, transcripts, lab marks and attendance.
I like to think that blockchain technology could have made my sign-up process smoother, more streamlined and, from the admitting university’s point of view, more reliable. Those were three days I could have spent sightseeing, enjoying perfect coffee, smoking cigarillos and meeting people in Paris, instead of waiting in line-ups, held up by red tape and inefficiencies.
Up close and personal with the Greek debt crisis
Years ago, my husband and I toured around Greece with some American friends that we made along the way. At the time, the European debt crisis and Greece’s sticky situation as one of the PIG (or PIIG) nations, dominated the headlines.
We knew, ahead of time that there was a daily limit on how much cash locals could withdraw from ATMs. Technically, these limits didn’t apply to foreigners like us, but the reality is that many of the ATMs we came across had run out of money.
That wasn’t supposed be an issue because we were armed with plastic but it turns out that wasn’t enough. Somehow, I forgot my debit card PIN (I blame the hot sun in Mykonos, the booze and a phenomenon I call ‘vacation brain’). By my third attempt to type it into an ATM, the machine’s screen politely informed me that my card had been locked.
In what turned out to be terribly unfortunate timing, my husband’s credit card was deactivated that evening because Visa says it was compromised back in Canada. Someone had stolen my husband’s digital information and had used it to buy $1,000 worth of beer in rural Ontario.
Luckily, we had enough euros to last us until Visa sent my husband a replacement card. Fortunately, he wasn’t on the hook for those purchases. It is worth noting though, that if he’d been carrying crypto assets in a digital wallet on a properly secured smartphone (or computer), it would have presented a real challenge to anyone trying to steal his funds.
This experience made me very aware of how useful it would have been to have another, global, portable, digital currency option. My conversations with the locals reinforced this belief. The Greeks I spoke with had been dealing with several years of successive recessions and economic and political uncertainty loomed large. Many people were actually stuffing cash under their mattress as an emergency fund. I saw, firsthand, a great use case for blockchain technology and for cryptocurrency, because almost anything is better than keeping cash stored under a mattress.
Getting carried away with baggage
My final example will resonate with anyone who has experienced a phenomenon known as lost or missing luggage. Like the time my friends and I planned a snowboarding trip out West and we arrived, but our snowboards and gear did not. We waited two days (out of a three-day vacation) for the airline to track down our stuff and ship it to our AirBnB. To say that we were disappointed would be an understatement. I won’t say the whole vacation was a bust because we still had a wonderful time. But without our snowboards, the main purpose of the trip was hijacked.
I know that luggage loss rates are currently at historic lows, but I would argue that with more people travelling more often, the chances of this happening to you, as an individual, have increased. The tantalizing possibility that blockchain technology offers is a perfect, nearly error-free tracking system so you can see, in real-time where your luggage is, and where it’s been. To this day, I don’t know if our snowboards somehow took a detour and ended up in Brazil. Blockchain technology could clear up that mystery.
If you add in smart contract technology (which the Ethereum blockchain enables), airlines could even design a system that automatically notifies you if your luggage has been delayed and compensates you for it. The transparency and accountability would be a huge boon to travelers and airlines alike.
These are just a few of the reasons why my travel experiences have taught me why the world needs blockchain. If you live in a country with a robust and inclusive financial system, minimal red tape delays and is generally home to businesses and institutions that run smoothly and efficiently, then the need for blockchain technology may not seem as obvious. But in other parts of the world, where economic instability and inequality are rampant, the need for cryptocurrencies and blockchain technology is glaring.
In another blog post, I will explain how blockchain technology is the missing link even in North America, and how it can solve problems that the internet and the digital revolution haven’t yet been able to.