“Blockchain is more than just a tool to enable digital currencies”
An opportunity is being missed to use distributed ledger technology to tackle some of the largest environmental challenges in the world, according to a new PwC blockchain report, published Monday.
Only three percent of investment in the technology in the second quarter of 2018 went towards environmentally beneficial projects, the global consultancy said.
PwC identified 65 emerging and existing uses cases of the technology that could disrupt how the world manages environmental resources. These range from decentralisng management of natural resources such as energy and water, to creating cleaner and more transparent supply chains.
“Blockchain may be able to facilitate the collation, monitoring and management of vast quantities of Earthsystem data in a geospatial digital ledger. New blockchain-enabled geospatial platforms are in the early stages of exploration and could monitor, manage and enable market mechanisms that protect the global environmental commons,” the report [pdf] suggested.
PwC Blockchain Report: Less than 1% of Blockchain Projects Tackle Environment
The paper notes that in the second quarter of this year 412 blockchain projects were invested in to the tune of £2.5 billion ($3.3). However, out of the 412 projects less than one percent were in the utilities and energy sectors; areas in which there is considerable scope for environmental improvement.
Celine Herweijer a Partner at PwC UK commented: “Blockchain applications to transform finance and commerce have been front of mind for business and investors to date. But there is an opportunity for fresh ideas to harness this nascent technology to help deliver big gains for our environment.”
The blockchain is a journal that adds a new block of transactions or information in intervals. Every user holds a copy of the complete chain, thus information can be compared and contrasted to make sure that the new block of information is correct.
A computer is chosen to upload the next block by being the first to solve a computational heavy task, like solving a math equation, this is done by the miners who are often rewarded with a cryptocurrency token for their effort. PwC defines Blockchain technology as, “at its most fundamental level… a new, decentralized and global computational infrastructure.”
The report found that many of the use cases which are relevant to environmental applications were often clustered around themes such as peer-to-peer trading of permits or resources, new financing models for environmental outcomes and supply-chain transparency and management.
The study highlights London-based start-up Provenance, which in 2016 piloted a public blockchain that tracked the fishing of tuna in Indonesia to its consumption by UK customers.
Around the world the fishing industry is host to human rights abuses, unfair and illegal work practices. In 2014 the Guardian uncovered supply chains that ran into UK supermarkets that originated from slave labour in Asia.
Provenance designed an application utilising blockchain technology that works through a simple smartphone to link identity, material attributes location, audit information and certifications with a batch ID or specific item.
Provenance state that this: “Data is stored in an immutable, decentralized, globally-auditable format which protects identities by default, allowing for secure data verification.”
“Fishermen sent simple SMS messages to register their catch, thus issuing a new asset on the blockchain with each SMS,” Provenance added.
Once this origin link is set up with the actual people who farm the fish it is then connected into existing supply chain systems. Since the blockchain can’t be retroactively changed, there is now a clear traceable line from line to fork for farmed fish.
Yet as the report points out this type of project only represents a small number of the blockchain projects that are being funded.
Dominic Waughray Head of the World Economic Forum’s Centre for Global Public Goods commented in a released statement that: “If history has taught us anything, it is that these transformative changes will not happen automatically.”
“They will require deliberate collaboration between diverse stakeholders ranging from technology industries through to environmental policy-makers, and will need to be underpinned by new platforms that can support these stakeholders to advance not just a technology application, but the systems shift that will enable it to truly take hold.”