How Blockchain Can Reduce Global Poverty
Though there are innumerable connotations for this revolutionary tech on finance and banking, blockchain can reduce global poverty in a wide range of areas.
Blockchain technology is a versatile piece of technological wonder not only capable of reducing poverty itself to historical connotations, but also permitting a wide berth of interesting and advancing elements for everyday productivity. As you can see, the applications of blockchain outside of financial services are innumerable and can be used in such a way that benefit poverty-stricken countries, as well as promoting a more fundamental system for relief programs, or other forms of financial assistance outside of the norm.
The applications of blockchain technology are literally widespread, so much so that the technology could be applicable to, quite nearly, any and every form of market. It's not solely a form of financial marketing service, or even a provider for digital currency. Blockchain technology is an advanced formula for the integration of data and other forms of information. When it comes to bolstering developing countries and likewise instituting a variety of blockchain systems for the benefit of financial inclusion, it would go without saying that the most fundamental outlier are the ways in which blockchain can reduce global poverty.
Cheap Banking Facilities
While the most important concept in the ways blockchain technology can reduce global poverty is essentially financial inclusion, there are a number of setbacks and, more or less, roadblocks to this equation. Much of the poor in any country tend to live off about $1.25 a day (if that), which then gives them little access to financial services, like banking, loans, and so on.
Fortunately, among the most prominent ways in which blockchain can end poverty, is the creation of cheap banking facilities. We've already seen a great deal of this when investing in Bitcoin: the peer-to-peer blockchain tech allows users to open a wallet, receive and send money at will without an ID or credit history. This allows those in poor countries to either utilize microloans, as seen in Wayniloans' bitcoin lending platform, or Blockchain-enabled remittances, like the $410 billion that flows to developing countries around the world.
One of the most fundamental aspects behind the world of blockchain technologies and their utilization in various concepts can easily be understood simply by way of its immense accessibility. As previously noted, banking and finance can be done on such a remote level that the need for ID and credit histories would be unnecessary; leaving your house, therefore, has become pretty much unnecessary due to the tech and its inborn mobile device nature.
This is how blockchain can reduce global poverty, simply by making emerging markets and developing countries more accessible to people around the world. More specifically in connotation to marginalized sectors, these accessibilities could grant a wide variety of concepts, as seen in Everex. The small ICO allows migrant workers to send money back home through blockchain-powered transactions, giving those in smaller, less-economically stimulant countries more access to financial services.
Role of Small Businesses
Small business growth is the utmost key in bolstering struggling countries and is among the many ways blockchain can reduce global poverty. Simply by bolstering small business transactions and developing better channels of income can benefit developing countries all around the world.
It's not simply through the facilitation of these businesses, but in bolstering their transactions, as well. In many cases, blockchain systems can holistically adapt how we experience small business by allowing micro-credit transactions and services for loan coverages on starting business costs. This is only one of many ways blockchain tech will adapt small businesses and help to reverse poverty on a global scale.
Unbanked and Underbanked
Unbanked and underbanked means that an individual or country is without a proper form of access to services like checking accounts or making loans. As of right now, there are nearly 2.5 billion people who are either unbanked or underbanked, which means they have no direct form of legitimate lending, making them more vulnerable to predatory practices and loan sharks.
Toke them less vulnerable and more fundamentally protected by these malicious forms of finance, blockchain can reduce global poverty by way of enhancing these countries' securities and legitimizing their markets. Blockchain technology will give unstable countries the option of leaving this cycle of extortionate interest rates and further financial instability by implementing a digital form of exchange that eliminates these negative concepts in financial markets.
One of the most prominent uses of blockchain, and more specifically Bitcoin, is the decentralized identity that comes with them. Whether public or private, the specific blockchain then will always give organizations the most singular form of the truth available. Similarly, one way how blockchain can reduce global poverty is by using the same concepts for not-for profit organizations helping the poor.
Once a more fundamental, or even beneficial digital profile is comprised for an individual or country, the more this blockchain technology can be used to harness that individual's or country's provisions, therefore increasing their profile for further transactions. The decentralized identity is only one form of how blockchain enables 360-degree economic profiles for both countries and individuals in need.
Role of Technology
One of the most awesome ways blockchain technology is being used to fuel emerging markets is through technology. For instance, blockchain technology could give us a smarter energy grid, but that's not solely how blockchain can reduce global poverty. Thanks to the likes of artificial intelligence, big data analytics and blockchain itself, the financial world itself has largely grown with innumerable channels that can be used as resources for the poor.
By then securing a more fundamental reality for informal economies, the blockchain technology itself serves as the basis for scaling large systems of finance, for instance accumulating government pensions, increased job security, increased government protection for consumers, and much more. The realities of technology and poverty can go hand in hand when utilizing blockchain to stimulate proficient economic stimulus for the needy.
With countries like Honduras, Georgia, and Sweden utilizing blockchain technology as a form of land ownership (despite Honduras' attempts recently stalled), it's clear that the aspects of blockchain can largely be used to register property ownership in a more fundamental aspect.
But, what if this could benefit how blockchain can reduce global poverty? It already can, by way of allocating a variety of records, whether they be property or simply concessions, for the use of safe registration and proper analysis. These concepts can be used in protecting the seller, mitigating fraudulent actions, and enabling more automatic transfers of ownership for struggling countries without these ideals. It can also reduce manual errors, and improve security of document transference, all of which can benefit developing countries around the world.
Rule of Law
While the entirety of law itself can't be transferred into that of a blockchain system, it still be generated in such a way that fuels how blockchain can reduce global poverty. One of these aspects is imply by way of storing the immense data of all the various principles as seen through smart contracts.
Popular as "If this then that statements," the smart contracts are a form of third party concession that simply allows or disallows the validity of a transaction. In this format, a smart contract can be used as a distributed ledger, in automatically executing transactions that cannot be ignored. If used correctly, these iterations under the blockchain technology can develop legal frameworks that make it easier for organizations and citizens to obey agreements under the law, therefore making it cheaper for those involved to play by the rules.
It's one of the most intriguing concepts in how blockchain can reduce global poverty; insurance, whether that be in health and life, usually is too expensive, due to either administrative costs, or simply inabilities to afford services. For instance, only about 15 percent of the population of India has health insurance.
Blockchain can greatly alter this phenomena by allocating a system for verification of transactions, which can deter (and expose) fraud, which will then reduce costs for insurers. One such blockchain-based microinsurance service is Consuelo, which is now allowing migrant workers the possibility of paying health and life insurance payments in small increments, verifying claims electronically and payments sent swiftly to ensure better opportunities for struggling economies.
At its heart, out of all the various ways blockchain can reduce global poverty, the most essential and necessary of the bunch is economic inclusion. This stipulates that blockchain technology can reduce poverty not solely through financial transactions, but also on combining identity with commerce.
BanQu, a blockchain-powered ID startup, is one form of potential economic identity that can be used to break countries out of the cycle of poverty. Their founder, Ashish Gadnis, believes that meshing these concepts is one of the only ways blockchain can further implement a more conducive economic identity for various poverty-stricken countries. This identity would give struggling individuals a way to facilitate their transactions and to simply participate in the action that which other exchanges simply disallow.
Future of Poverty
There's a variety of potential for the likes of blockchain in reducing global poverty. The implementation of these technologies can largely benefit the world, not solely those in need, which is a more holistic, universal and up-front concession to the benefit if world economies. Going into the future, the blockchain ideal can mean wonders to finance, but also in elevating the world on a number of varied fronts.
With many a variety of companies dropping their own forms of blockchain-powered digital identity programs, which validate individuals' identities, ensuring that data of all kinds that are not only backed by validity, but complete accessibility will only be one of the many channels blockchain can reduce global poverty. The future of poverty may be unattainable (since poverty may very well be a thing of our past), and this can all be thanks to blockchain.