Case Studies

How to Harness Blockchain: Exploring Case Studies

The following eight case studies represent not only what blockchain can do today, but what it promises to accomplish in the future. Each example demonstrates how blockchain has helped to overcome challenges of accountability, security, or efficiency within a specific social sector.

PROBLEM: How do individuals without bank accounts or government identity documents participate in financial systems? Currently, organizations like the UN World Food Programme (WFP) coordinate with more than 30 other relief organizations and international financial institutions to deliver aid. Traditional systems not only incur significant banking fees, but also delay transaction resolution between cooperating partners, banks, and the WFP. As numbers of displaced persons increase and cash transfers become a predominant form of aid disbursement, intermediary banking services create inefficiencies and absorb resources.

SOLUTION: The Building Blocks program is built on the Ethereum blockchain, due to its need for high scalability. Money transfers are represented with digital tokens, which are exchanged for food and supplies. WFP reconciles payments with vendors monthly, bypassing escrow and bank charges while preserving payment security. The initial pilot in Jordanian refugee camps serves over 100,000 people, while significantly reducing bank transfer fees and increasing responsiveness and time-efficiency when acting on beneficiary needs.¹

HOW IT WORKS: Refugee families receive tokens in their digital wallet every month, which can be credited to participating markets in exchange for goods and services. Each family’s identity is verified by the existing UNHCR case number via iris scanners (biometric identity) at each vendor. WFP transfers payment directly to the vendor. In this system, cash never enters the blockchain, but represents wealth transfers that are reconciled each week.

WHY BLOCKCHAIN: By creating a transparent, tamper-proof record of provisions purchased by refugees, blockchain allows relief agencies to directly reconcile payments to each other and to suppliers, reducing redundant activity in auditing payments. Furthermore, the security of blockchain technology removes the need for banks to facilitate transactions and for refugees to carry cash or bank cards, lowering associated costs and potential theft.

CHALLENGES: The initial pilot underutilized the blockchain’s capacity to integrate data from multiple sources, since WFP was the sole party processing information. Once additional parties—such as markets, banks, and other UN agencies—are added, Building Blocks will encounter new governance challenges as more entities access and write to the blockchain.

BROADER IMPACT: The potential to secure human rights and improve access to resources extends beyond refugee populations. UNICEF is exploring blockchain applications to crowdsource aid funding, reduce operational expenses, and make field staff more effective. Other examples of organizations working to leverage blockchain to safeguard human rights include a partnership between BTA, Coca-Cola, and the U.S. State Department to combat forced labor in global supply chains which utilize migrant workers. The De Beers Group has announced a project to weed out blood diamonds from supply chains. Everledger is a start-up company building blockchain-based solutions in markets where provenance matters, such as diamonds, art, and wine—proving a consumer appetite for transparency and ethical trade.

PROBLEM: Land is a principal source of wealth and economic mobility, and land registries grant owners legal authority to leverage property. Ambiguous ownership, corruption, and cumbersome transaction processes increase instances of fraud, erode trust in institutions, and stifle economic mobility. In Georgia, years of corruption enabled by a fragmented registry system crippled trust in a new digital public registry system implemented as a result of government reforms following the 2003 Rose Revolution.

SOLUTION: The Republic of Georgia’s National Agency of Public Registry (NAPR) partnered with Bitfury in April of 2016 to create a blockchain solution that allows NAPR to verify proof of ownership, while enabling citizens to verify the legitimacy of their documents without exposing confidential information. Citizens now have a transparent and auditable method of ensuring that land registry records remain legitimate.

HOW IT WORKS: Citizens register their property through a digital interface, which creates a timestamped hash of the property certificate and uploads the hash to the public Bitcoin blockchain. Timestamping the hash on the Bitcoin blockchain tamper-proofs the documentation and enables its owner to prove that the certificate was authorized by NAPR and any subsequent records disputing their ownership are invalid. A fraudulent record results in a different hash than that registered on the public blockchain, proving the edited record invalid.

WHY BLOCKCHAIN: By creating transparent and verifiable registry systems, governments can restore confidence in property titling and foster investment and economic growth. The decentralized blockchain network reduces the risk of fraud by constantly verifying and reconciling transactions against unique land ownership records. The transparency and resiliency of a publicly accessible blockchain reduces the risk of corruption and restores public confidence in the system.

CHALLENGES: The Republic of Georgia land management bureaus underwent significant institutional reform beginning in 2004, and already held land registries in a digital format. Nascent bureaucracies like in Honduras, on the other hand, may have incomplete or analog records that are not ready for blockchain implementation. Additionally, encoding records onto a blockchain assumes confidence in the existing registry. Countries must ensure that land registries have not been manipulated before adding them to the blockchain, or else risk codifying injustice into a new registry.

BROADER IMPACT: Other countries are pursuing land registries to reduce transaction costs and secure land capital for economic growth. The Swedish Lantmariet is piloting a solution to accelerate real estate transaction speeds from 3-6 months to 10 days. The Dubai Land Department has begun recording property transactions via blockchain, enabling global investors to verify property data and ensure the accuracy, credibility, and transparency of investment transactions. The University of British Columbia partnered with blockchain land registry company Ubitquity to pilot a solution for the Real Estate Registry Office of Brazil to reduce fraud and human error in the recording of land ownership. Land registry solutions are projected to benefit developing countries with lower levels of institutional trust, where a projected interest rate reduction of 0.1 percent “would create USD $14B per year in added value worldwide,” opening up new sources of capital for millions of landowners.²

PROBLEM: While retail food stores safely provide fresh produce to their consumers the vast majority of the time, food contamination poses severe dangers to consumers, retailers, and farmers. Tracking the sources of food products through the supply chain is notoriously difficult and time consuming. Paper-based systems are susceptible to human error, and digital data systems are often siloed and unable to trace the full journey of a product from farm to store. When food contamination is discovered, stores must implement sweeping recalls despite only a small fraction of products being affected, costing millions of dollars in wasted food and labor, and posing significant danger to the public.

SOLUTION: Walmart leveraged IBM’s Food Trust technology, a private blockchain built on Hyperledger that can traces food production in retailer supply chains. Food Trust stores data on a traditional database and exports a record of changes to the blockchain, which ensures data privacy of supply chain partners, maintains high scalability, and aligns with existing industry standards. Initial pilots in Spring 2017 reduced trace time from days or weeks to seconds, encouraging Walmart to implement Food Trust as a requirement for all suppliers of fresh produce by September 2019.

HOW IT WORKS: Workers within the supply chain upload food processing data to the blockchain via a standard naming convention so goods can be consistently tracked across suppliers. Between each exchange of ownership, the blockchain confirms the origin, path, destination, and entry date of the product. Authorized users can then verify food provenance to determine the scope of the problem, determine contamination origins, and conduct more precise recall measures from affected retailers, creating transparency and accountability that doesn’t exist in the original system.

WHY BLOCKCHAIN: Blockchain provides a tamper-resistant and decentralized way to trace a food item from its origin to its point of sale at a store. By requiring food producers and logistics workers to input transportation data onto the blockchain as a product travels through the system, retailers can transparently and accurately trace dangerous food items directly to their source, reducing the risk of foodborne illness and passing on savings to consumers.

CHALLENGES: IBM Food Trust is a private and permissioned blockchain that restricts visibility of data to authorized users. While this enables transparency within the distributor’s network, it excludes other important entities such as regulatory agencies and research institutions from accessing data, limiting accountability to the public and depriving public-interest organizations from capitalizing on data. Inclusive permissions can enable third party read-access to the food supply chain while restricting write-access to authorized distributors, which would more fully employed the benefits of blockchain openness and provide impactful data to organizations operating in the public interest. Additionally, tracking non-digital assets increases the probability of errors and requires external structures to encourage correct data entry into a blockchain.

BROADER IMPACT: Despite its reliance on human input, Walmart leveraged a blockchain system that considered the needs of users, scaled carefully after early pilot success, and worked alongside redundant system for added security. Blockchain has diverse applications beyond food supply chains. The World Wildlife Fund launched a pilot to improve traceability of fishing practices in the Pacific Islands and help mitigate illegal and unregulated fishing. Maersk built a blockchain to more efficiently fulfill shipping orders, reducing wasted cargo space and diminishing marine shipping traffic in the long-run. These are a few examples of how blockchain can securely track assets and increase efficiencies within supply chains.

PROBLEM: Newly affordable sources of renewable energy enable households to produce and consume power locally, creating a more efficient energy grid. However, the current centralized model of energy distribution is inefficient and restrictive. Establishing a decentralized model of energy infrastructure is crucial as energy demand evolves and fossil fuels exacerbate climate concerns.

SOLUTION: LO3 Energy created a local energy marketplace which enables solar panel owners (“prosumers”) to buy and sell energy locally over existing electrical infrastructure. The Brooklyn Microgrid uses its blockchain based marketplace to connect various solar sites to customers, who can buy and sell local power while preserving the utility provider maintenance of the electrical grid. This solution promotes a sustainable clean energy model, increases electrical grid efficiency and resiliency, and drives down costs for consumers.

HOW IT WORKS: Participants access the local energy marketplace through the Brooklyn Microgrid mobile app. In the app, people can choose to buy local solar energy, renewable energy produced outside of the Brooklyn, New York area, and/or grid energy. Prosumers sell their excess solar energy onto the marketplace for consumers to bid on. Local solar energy is “won” by consumers via an auction. Prosumers can sell their excess energy on the marketplace once they have installed a Brooklyn Microgrid smart meter system, which gathers and records energy data for use within the energy markets.

The marketplace is scalable to communities all over the world via Exergy, an open-source platform and token system for managing and permissioning access to energy data. As a foundational protocol, Exergy enables digital applications, such as the Brooklyn Microgrid marketplace, to be deployed almost anywhere.

WHY BLOCKCHAIN: Blockchain provides a decentralized infrastructure, a secure method of recording transactions, and a transparent interface. Smart contracts built into the blockchain enable the marketplace auction mechanism. The distributed functionality will allow for millions of users and devices—with different incentives—to participate in the market over time.

CHALLENGES: Brooklyn Microgrid is aiming to change the way electricity is bought and sold. Although this innovative approach is in alignment with New York’s energy policy “Reforming the Energy Vision,” it requires a revision of the existing regulatory framework.

Currently, this model functions on a small scale, but may receive industry pushback as it scales. Additionally, the pace of expansion will be limited by the installation speed of and excess supply from local solar panels. Therefore, owners may not feel the network effect benefits until a critical mass of additional participants are established.

BROADER IMPACT: LO3 Energy and other organizations continue to test how blockchain technology can democratize access to sustainable energy. LO3 Energy also partners with Centrica to test a similar peer-to-peer energy exchange market in Cornwall, England. The energy needs of the twenty-first century require innovative ways of producing and effectively allocating power to the world’s population. Blockchain technology offers a secure and decentralized structure to ensure that new infrastructure is equipped to handle this need.

PROBLEM: Smallholder farmers in developing countries greatly benefit from cooperatives in which they can collectively bargain for better prices for their goods, share equipment, and circulate best practices. However, restricted access to information and corruption within cooperatives erode trust in the system, disrupt transactions, and create financial losses.

SOLUTION: AgUnity provides smartphones to farmers that are pre-loaded with the app, ensuring that farmers use compatible hardware for the program and utilize secure devices when accessing the AgUnity blockchain. Built on the Multichain blockchain platform, the app can operate offline in rural areas until an internet connection is reestablished. The pictographic interface is customizable, enabling different crop types and cultural nuances to integrate into the platform. Initial pilots in Kenya and Papua New Guinea demonstrated a 300 percent increase in income for farmers equipped with AgUnity devices.

HOW IT WORKS: Farmers log on to record crop-processing transactions and sales. The transactions are visible to all other members, ensuring transacting parties follow through on agreements. Each farmer is assigned a digital wallet which stores receipts, which are then converted to cash upon arrival at the cooperative. AgUnity also provides encrypted messaging services for farmers to collaborate on harvest planning and equipment sharing.³

WHY BLOCKCHAIN: Blockchain creates a permanent record of transactions, enabling farmers to be confident that agreements with cooperative representatives will not be changed without their consent. Furthermore, the record is auditable by other members of the cooperative, providing transparency and accountability to farmers who are concerned that crop brokers might renege on their commitments.

CHALLENGES: Despite the efforts to instill trust in the cooperative system, AgUnity centrally controls transaction records, identity data, and programming on participating devices. This requires farmers to trust AgUnity as a mediator and limits expansion. Additionally, farmers are not paid independently of financial institutions and must exchange digital credits for cash (although integration with digital cash platforms like M-Pesa are forthcoming). Lastly, there is no independent validator of transactions and farmers still rely on off-chain enforcement if a cooperative defaults on an agreement.

BROADER IMPACT: AgUnity continues to expand its financial inclusion offerings, including digital wallet capabilities and securitized loans. Other blockchain companies are addressing gaps in financial services in developing countries. BitPesa is a mobile payment system that lowers transaction costs and manages risk, bringing stability to communities and fostering economic mobility. WorldRemit provides blockchain-driven remittance services that are near-instant, secure, and direct, encouraging financial exchange and providing stability to beneficiaries. Building financial tools for marginalized populations is a critical component of achieving global development goals, and blockchain will be central to successful financial inclusion.

PROBLEM: Overseas military members and their families have few choices when it comes to voting in U.S. elections. Currently they must either mail in their ballot, fax or email it to a county clerk’s office, all of which have proven to be cumbersome (and often impossible) for uniformed service members in remote areas of the world. But military members have no guarantee that their vote will reach their clerks in time, be counted, or remain private and secure throughout the process. These factors reduce the ability, willingness, and motivation of service members and overseas voters to participate in the democratic process.

SOLUTION: The Office of the Secretary of State of West Virginia, in partnership with Voatz, Tusk Montgomery Philanthropies, and the Blockchain Trust Accelerator piloted a mobile voting application powered by blockchain in the 2018 Primary and General elections in accordance with state and federal regulations for absentee ballots. The initial pilot was limited to West Virginia UOCAVA (the Uniformed and Overseas Citizens Absentee Voting Act) eligible voters registered in Harrison and Monongalia Counties for the Primary election, then scaled up to 24 counties in the General election. The first vote in a U.S. federal election cast through a blockchain-based solution was cast on March 24, 2018—the day absentee voting opened in the 2018 West Virginia primaries. The first vote cast in a general election was hashed to blockchain on September 21, 2018. In the Primary election, 13 votes were cast through the solution. In the General election, 144 votes from voters in 31 different countries were cast out of 160 voters who applied to use the technology.

HOW IT WORKS: Eligible voters complete and submit the Federal Post Card Application (FPCA) to their county clerk. Once the FPCA is received and the voter’s information is confirmed, voters are prompted to download the Voatz app, verify their identity and eligibility using biometric security measures, and then complete the voting process securely and privately through their smartphones or tablets.

WHY BLOCKCHAIN: Blockchain enables voters to submit their election ballots through a distributed, cryptographic ledger that has no single point of failure and cannot be edited. Furthermore, votes remain auditable by election committee officials without providing personally identifiable information about a voter, providing the same anonymity that poll voters are guaranteed.

CHALLENGES: While the blockchain mobile voting process is a significant improvement to existing systems for overseas voters, a number of concerns remain. Mobile voting requires voters to have smartphones or tablets, and despite the security measures that blockchain offers once data is recorded, unsafe internet connections and/or unsupported devices may impact the ability of a voter to submit a ballot successfully. The application utilizes sophisticated malware detection software, which will disable the application and prevent a ballot from being accessed if the device is deemed insecure. In that case, alternative methods of absentee voting remain available to those whose devices are insecure, and to those who do not own or cannot operate a smartphone. However, like all technology, security must be constantly monitored and updated as nefarious actors adapt and look for ways around the current protections.

BROADER IMPACT: Blockchain has the potential to transform the way citizens interact with their government and restore trust in the institution of voting. The city of Zug, Switzerland recently leveraged a blockchain-powered mobile voting platform by Luxoft for its municipal elections. The Republican Party of Utah partnered with Smartmatic to offer its party members the ability to vote from anywhere in the world for the 2016 Republican Presidential Caucus. As the technology matures and more election officials and the general public increase their understanding of the system, blockchain-powered voting will provide citizens with a responsive, effective, and trusted method by which to engage with their government.

PROBLEM: Municipal bonds have long been a key source of funding for public projects. By connecting investors with local governments issuing bonds, they fund civic investments like schools, libraries, and parks. However, complex regulations and a scattered bond landscape create barriers for willing investors, preventing communities from accessing capital when needed. Furthermore, investors encounter challenges when tracking the impact of their investment, leading to accountability issues that dissuade investment within communities.

SOLUTION: Elected officials with the City of Berkeley partnered with Neighborly and the UC Berkeley Blockchain Lab to explore building a platform that would facilitate investment opportunities between residents and the city for as low as $10. By broadening the range of investors and investment opportunities, City of Berkeley officials seek to empower residents to invest in projects that are significant to them, expanding the types of projects that could be funded with municipal bond financing given current federal, state and local regulations.

HOW IT WORKS: Investors will buy tokenized municipal bonds, denominated in U.S. dollars, that will enable the city to allocate resources more broadly and quickly, but also to create new initiatives such as food vouchers for the homeless. Since local investors will have better access via the blockchain enabled financial tools, it could be increasingly easy for investors to indicate a project they would like to fund, discover how their funds will contribute to the project, and review investment characteristics.

WHY BLOCKCHAIN: Blockchain technology can bypass middlemen and decrease transaction costs, enabling small investors and municipalities to easily form mutually beneficial partnerships. Decentralization enables companies like Neighborly to store financial information accurately and cheaply, while an auditable trail provides “Know Your Customer” audit compliance. Finally, blockchain tracks all financial movements to prove that investments have been spent as intended.

CHALLENGES: This pilot is in its infancy and few details have been published about the mechanics of the blockchain solution. However, blockchain would enable varying degrees of data viewability, instilling transparency and accountability for regulators and investors. While blockchain makes the transaction process between issuers and investors easier, more accessible, more efficient, and more transparent, project selection will be contingent on the local governments issuing the bonds.

BROADER IMPACT: The efficiency and transparency challenges in procurement, fundraising, and social investment are well-suited for blockchain intervention. AidCoin built a fundraising platform that tracks contributions through blockchain to lower fees and offer clarity into how funds are being allocated. St. Mungo’s, a charity based in London that provides services to the homeless population, uses a blockchain transparency tool called Alice to track contributions in real-time and reallocate funds as new priorities arise, giving more power to donors to choose how their contributions are utilized. Blockchain offers the security and accountability that communities and charities seek to revitalize trust and galvanize social good investments.

PROBLEM: Every year, approximately 8 million tons of plastic enter the oceans, adding to the over 4 trillion pounds of plastic currently destroying marine ecosystems, endangering food supplies, and degrading living conditions for millions of coastal communities. Over 80 percent of waste is generated by populations with insufficient waste management systems. Garbage can provide income for millions of marginalized people living in polluted areas through recycling redemption programs. However, cash transfers invite crime in underdeveloped societies and currency localization inhibits organizations from growing to meaningfully impact the enormous accumulation of plastic on the planet.

SOLUTION: Plastic Bank partnered with Cognition Foundry and IBM to create a mobile app to track the amount of recyclables submitted to local drop off depots in participating areas.

HOW IT WORKS: Local populations download the app onto their smartphone and collect plastic in their neighborhoods. Collectors earn digital tokens by weight that they can either redeem for currency or spend at participating stores, Wi-Fi hotspots, and phone charging stations. The plastic is then exported to factories processing sustainably-sourced plastics.

WHY BLOCKCHAIN: The growing ubiquity of internet-enabled smartphones allows blockchain to provide financial services to previously inaccessible populations. Failure-resilient, secure transactions offer a reliable and safe method of earning and spending income. Rather than constructing a centralized network, blockchain enables decentralized ecosystems in which local plastic collectors can directly connect with manufacturers without any intermediaries managing the relationship.

CHALLENGES: Despite the wide adoption of smartphones and significant gains in internet connectivity, Social Plastic still relies on internet connectivity to provide financial services to its clients. While they do not need connectivity while collecting plastic, transactions that occur outside of covered areas will not benefit from immediate transaction resolution. Also, income for collectors is contingent upon companies paying above-market prices for recycled plastic. The success of this model relies on sustained demand for ecologically responsible products.

BROADER IMPACT: Other organizations are leveraging the power of blockchain technology to repair and protect the environment. Sustainability International’s Clean Up Niger Delta project pays community members via digital currency for completing clean up assignments, then documents it on the blockchain. In another project, IBM partnered with Chinese Energy-Blockchain Labs to build a carbon asset management system on Hyperledger, reducing the cost of participating in carbon credit exchanges and helping businesses emit less carbon into the environment. Blockchain technology enables small groups to create economically viable environmental cleanups around the globe by storing verifiable information about pollution trends and repairing the environment through decentralized collaboration.

PROBLEM: Factual proof forms the foundation of all evaluation and decision-making, from journalism to policymaking and voter choice. Forgeries undermine the public’s ability to make sound judgements or to trust facts when they are presented. Increasing sophistication of photo-editing software, lower barriers to access, and larger networks to proliferate forgeries have eased the circulation of misinformation. Convincing forgeries of photos, videos, documents and voice recordings post severe threats to privacy, national security, and democracy.

SOLUTION: Identifying disinformation is only one piece of the puzzle. In partnership with the Design 4 Democracy Coalition, Emercoin, and the Blockchain Trust Accelerator piloted the Democracy Notary platform, which secures official copies of public statements to prove that content is original and legitimate. Its first use case was in relation to the 2018 Macedonian referendum. Built on Emercoin’s permissioned blockchain, it permits trusted civil society organizations to upload content and provides the public with read access to compare disseminated reports with verified blockchain entries.

HOW IT WORKS: Democracy Notary immutably encodes key documents into a blockchain that can serve as a “truth-check” when manipulated or falsified documents are used as a weapon of disinformation during high-stakes events such as elections. The Design 4 Democracy Coalition aims to eventually give permissions to trusted civil society organizations to post to the Democracy Notary, which converts documents, reports, and other original media of public interest into unique hashes and posts them on the blockchain where it becomes mathematically impossible for data placed in the system to be altered or destroyed. Blockchain, therefore, can demonstrate the integrity of information and make it possible to debunk forgeries and manipulation.

WHY BLOCKCHAIN: Blockchain technology uses algorithms to assign hashes to uniquely identify data files. Any changes to an original file will result in an obviously different hash, and therefore be easily recognizable as a different file than the original. Blockchains are accessible globally, enabling individuals around the world to easily record hashes of original content and enable others to verify copies of information by comparing their hashes to the catalogued hash of the original.

CHALLENGES: While the Democracy Notary platform was designed to help citizens find accurate sources of information for elections, challenges remained in driving user adoption. The team sought to embed the technical complexities of the platform behind the user interface to simplify the user experience. Despite its difficulty, creating user-centric interfaces is critical to creating value for end users and for broader adoption of a new technology. Moreover, Democracy Notary experienced challenges in educating the public about its service in the weeks leading up to the election. Platforms that combat fake news should be coupled with sustained public education campaigns to inform concerned citizens of secure, reliable news alternatives.

BROADER IMPACT: Blockchain enables immutable timestamping of content, creating a niche for content verification and notary services to make forging information more difficult. Blocksign enables users to sign legal documents and timestamp digital signatures on the blockchain to prove that a document was validated at a certain time without trusted intermediaries. Blocknotary extends these services to any type of media, and offers a video interview process for remote verification of identity. While questions of originating ownership and court eligibility demonstrate off-chain challenges to digital notary services, they offer a significant tool to combat fraud and forgery in public documentation.