Blockchain — Can it power inclusion?
Part 2 — Smart Contracts
I think a good place to start is to explain what Blockchain actually is.
Blockchain is an online ledger. A growing list of records that form a block. These blocks are then linked through cryptography. This is important as each block contains what’s called a cryptographic hash from the previous block which is a timestamp that authenticates the data existed when the block was published to get into the hash.
Quite simply blockchain is an online record of transactions which can be used for money, the movement of goods and exchanges in information. It’s a great way to keep records and more importantly sharing the truth of those records.
The best explanation I have seen was provided by Bettina Warburg, a political scientist and blockchain researcher who explained blockchain in 5 Levels of difficulty for WIRED.
So, what can you actually do on a blockchain? Turns out quite a lot.
· Secure sharing of medical data
· NFT marketplaces
· Music royalties tracking
· Cross-border payments
· Real-time IoT operating systems
· Personal identity security
· Anti-money laundering tracking system
· Supply chain and logistics
I don’t claim to know what all of the above is, but how is through something called Smart Contracts.
When I first heard the term a few years ago I was at a round table dinner hosted by an IT consultancy we were doing discovery with. A question was posed to the guests for their opinion on what technology most excited them in the next 5–10 years.
One of the guests answered without hesitation “smart contracts”. He viewed it as the most exciting piece of tech we can expect. He predicted that it would massively impact our lives.
I honestly thought he was talking about platforms like DocuSign or Panda Docs — contract builder platforms that recruiters like me were using.
I could not be more wrong.
Smart contracts are programs stored on a blockchain that run when predetermined conditions are met.
It is automated and can ensure certainty of transaction without any third parties.
Two key points stand out for me, about smart contracts. That is, they are immutable and distributed.
Immutable is key. As once a smart contract is created it can never be changed again — it cannot be tampered with and distributed because it is validated by everyone on the network.
What has any of this got to do with inclusion? To help answer, I think it’s best to first understand another key feature associated with blockchain. Decentralisation.
Decentralisation is defined as the transfer of authority and responsibility for public functions from the central government to subordinate or quasi-independent government organizations and/or the private sector. Reading that makes me think of this clip from Marvel’s “What If”.
What I think that means is there is no one person, entity, agency or organisation that is in control. This is exactly what a blockchain is.
In a decentralised blockchain network, no one needs to know or trust anyone else for it to work as each member of the blockchain has a copy of the exact copy of data in the form of a distributed ledger, this makes it impossible to be tampered or corrupted. Once something is in the ledger it can never be removed.
For instance, you can view every single transaction ever performed for Bitcoin on its blockchain. There, for all to see.
In a centralised network, it’s quite the opposite. We’ve seen how a centralised network can be compromised, corrupted, and influenced by bad actors or in favour of the powerful and few.
Decentralised blockchains provide many to access services that currently elude them. For instance, we can now connect ill served communities with ownership of identity, documentation and assets.
Charles Hoskinson, a founder of Ethereum (ETH) and CEO at Cardano (ADA) paints his picture of the future in a 2014 Ted Talk.
He believes blockchain technology will revolutionise property rights, banking and private law for the developing world. As a decentralised blockchain is distributed, tamper resistant, secured in a cryptographic database it’s the perfect place to store property rights, credentials, identities, and agreements. It’s also censored resistant.
In any meaningful metric for quality of life, this will always improve in line with access to financial services. Less wealthy nations tend to be without insurance and pay high costs for transferring money, much of their economies are cash led and agreements are verbal contracts. Blockchain technology can change that. It provides access.
The exciting news is that blockchain can provide any decentralised equivalent to a centralised network through smart contracts. Providing equal access to services through technology to any individual will play a key role in creating inclusion for all.
In the next part of this mini — series on blockchain, we delve deeper into the players in this space and what they are doing for diversity, equity and inclusion.
Think about access in your business. You may not be working with blockchain technology but you can always think about ALL.
Contact CandidateX about inclusion in your business.