Blockchain Technology: Hero or Menace
Since the first workable prototype of the internet was born in the 1960’s, the internet has evolved into a powerful tool for accessing information and plays an irreplaceable role in modern society. With the development of the internet, individuals and corporations have strived to build upon its framework to deliver a more robust and meaningful experience for its users. Founded in 1998, search engine giant Google has revolutionized the way in which users interact with the internet. Google’s vision centered around pioneering a more efficient method of accessing information on the internet through an algorithmic based search engine that prioritized the outcome of its uniform resource locator (URL) based on its relevance to the user’s search. Google’s search engine product made evident that not only did information have value, but it also reflected an unconscious level of trust between the information provider or “authority” and the information receiver or “user.” Over the past decade, individuals have sought ways to democratize information in a way that bypasses a central authority or database. In 2009, the first application of a decentralized method of storing information known as the blockchain was released. Blockchain technology centers around leveraging a decentralized database that is immutable, yet accessible to the ordinary user. However, unlike Google’s control over the data it facilitates, the blockchain, through a network of computers or “nodes” working in unison, allows for a self-governed database that isn’t controlled by any single person or corporation. Originally developed with the objective of bypassing an intermediary for financial transactions through a decentralized, peer-to-peer exchange model, which is today known as the digital currency bitcoin, the blockchain has evolved into a versatile technology that is capable of revolutionizing other facets of our world. Although some may argue that the widespread implementation of blockchain technology has the potential to exacerbate the digital divide in underdeveloped countries, proper utilization of the blockchain holds the power to improve the efficacy surrounding corporate governance, make information more transparent and accessible, and facilitate new mediums of exchange that empower the everyday individual. Thus, individuals and governments should be more accepting of blockchain technology and genuinely consider its potential applications as viable solutions to global issues.
One area in which implementing blockchain technology could benefit society is corporate governance. With the development of modern society, large corporations have evolved into dominant providers of basic necessities that individuals have become reliant on. In spite of the dependency society has developed with these industry giants, individuals are greatly affected by the management blunders of large corporations. Specifically, supply chain management has required increasing amounts of attention as food-borne illnesses and other lethal consequences are possible without proper management. Take fast-food giant Chipotle, for example. According to NewsDeck, Chipotle paid an aggregate amount of “$25 million” from 2015 to 2018 due to an “outbreak of food-borne illnesses,” representing the “largest ever fine of its kind.” Consequently, more than 1100 people suffered from the outbreak, forcing the US Government to intervene. When questioned with the changes the company would make to avoid future outbreaks, Chipotle CEO Brian Necol explained, “we will be adding to our daily food safety routines a recurring ’employee knowledge assessment’ of our rigorous food safety standards.” Based on Necol’s response, it is evident that Chipotle’s mistake stemmed from poor employee-based regulation of the food quality used in its restaurants. In this case, Chipotle would have been able to avoid this mistake if it had better supply chain protocols in place, which would have eliminated the reliance on employees to make accurate judgments. Thus, a blockchain-based solution would have been more than appropriate as it could have efficiently tracked the supply chain data without being subject to human fault or a lack of employee diligence. Furthermore, a blockchain-leveraged food management system would have ensured that the food’s quality met company standards, irrespective of employee opinion. Ultimately, more restaurants should consider food management systems centered around blockchain technology in order to shield consumers from potentially lethal food outbreaks like that caused by Chipotle. Not only would large scale restaurant chains benefit from implementing blockchain-based management solutions, but so too would retail providers. According to Kevin Webach, in his book, “The Blockchain and the New Architecture of Trust,” in a 2016 food-safety trial with IBM, retail giant Walmart piloted a “permissioned distributed ledger” solution to test its efficacy in improving “supply chain visibility” within its existing management system. As one of largest retail corporations in the world, Walmart places great emphasis on supply chain management to ensure that its suppliers’ products wind up on its shelves. Though, manually tracking thousands of items is not only time consuming, but also subject to human error which could result in something as detrimental as Chipotle’s sanitation misstep. With the idea of helping deter foodborne illnesses through the use of blockchain technology, Walmart’s pilot project aimed to test this solution by recording the journey of a mango shipment from one of its many suppliers. Webach explains that the company recorded “information on a distributed ledger using bar codes every time a product moved from one point to another.” In the next step of the experiment, Webach notes that Walmart’s management team was challenged to identify “which farm produced a package of mangoes sold in one of Walmart’s stores using conventional supply-chain mechanisms.” In other words, Walmart’s management team was asked to pinpoint which package of mangoes was provided by a supplier that practiced customary regulation policies. Walmart’s team took a week to manually identify the correct farm. In contrast, Webach notes that the management team was able to get the answer in “just over seconds” when using the blockchain-based system to identify the conventionally operated farm. IBM’s research with Walmart shows how blockchain technology has extraordinary potential to improve supply chain management and reduce calculation time to just over a few seconds, which in a disease outbreak, “could be a matter of life and death,” as Webach remarks. Overall, Walmart’s successful trial with blockchain-based management systems should serve as an important sign for major corporations to seriously consider the implementation of the blockchain to not only better govern their corporation, but to also improve consumer safety; as Walmart food-safety executive Frank Yiannis states, “even a modest percentage reduction in foodborne disease” would save the economy “billions of dollars.”
Another reason individuals and governments should be more accepting of blockchain technology is because it holds the power to transform the way in which information is managed that empowers the everyday individual. The blockchain possesses great versatility in which it has the ability to either make information more transparent and equitable, or more secure and foolproof depending on the context of its implementation. Take the digital currency Bitcoin, for example; the currency is built upon a completely decentralized database, allowing any user to access the same information as its counterpart. In other words, there is no single user or group that possesses “special” access or privileges. In turn, bitcoin’s decentralization allows for its information, which is in the form of its price, to be equally accessible and transparent across its entire user network. This idea of a transparent network of information has great potential in the storing of government data. According to Harvard Business Review, in February of 2020, President Trump’s administration “eliminated open data” from its website. The use of blockchain technology in government would have shielded citizens from data-monopolized decisions such as the one made by Trump’s administration. While implementing a peer-to-peer network in regards to government data may not be feasible, it can certainly be structured in a way that leverages blockchain technology to provide more transparency without compromising its secureness. As mentioned before, blockchain technology can also be utilized to make information more private and less susceptible to exploitation. In 2014, 500 million Yahoo accounts were compromised, representing one of the largest data breaches in US history. According to data scientist and author Williams Martyn, the hacker, “installed a backdoor on a Yahoo server where he later stole a backup copy of the user database onto his personal computer.” Had Yahoo employed blockchain technology to cryptographically store user’s information, the hacker wouldn’t have been able to access millions of people’s private information, including credit card data, addresses and social security numbers. Thus, governments and major corporations should genuinely consider utilizing blockchain technology to store information, whether it be for the purpose of increasing its transparency or privacy.
Some may argue that the widespread adoption of blockchain technology will widen the digital gap between less developed countries and their more powerful counterparts. For example, according to the International Encyclopedia of Social Sciences, which tracks the accessibility of technology across the globe, “in 2004 fewer than three out of every one hundred Africans used the Internet, compared with an average of one out of every two inhabitants of the industrialized countries” and that “there are more than eight times as many Internet users in the United States than on the entire African continent.” While these numbers may be accurate, less developed countries are becoming more digitally active over time and therefore won’t heighten the digital divide. For instance, researcher Willem Van den Berg, in his paper assessing the potential implementation of blockchain technology in “fragile states,” explains how during Somalia’s civil war, “the country’s mobile coverage was at its highest and its telecommunications costs were at its lowest.” Van Berg’s research on the mobile coverage and telecommunications cost shows that countries that are less politically stable are actually extremely technologically active. Thus, even in poorer countries, the implementation of the blockchain won’t pose a threat as citizens of poorer nations continue to become more digitally active. In fact, some African countries are already deploying blockchain technology to better manage their industries. For instance, emerging corporate leader in blockchain-based solutions Peer Ledger is focusing on giving “companies a trusted, immutable record of transactions, documents, and metrics across their entire supply chain to support responsible supply chain management and due diligence.” Peer Ledger is disrupting the African mining industry as they are empowering individuals with a decentralized method of verifying shipments and tracking inventory. Peer Ledger’s implementation of the blockchain across the African continent is a perfect example of how blockchain-leveraged solutions can benefit all parts of the world, irrespective of a country’s wealth or power.
Overall, blockchain technology has immense potential to benefit a myriad of industries in a way that promotes equality for the everyday consumer. As blockchain technology continues to gain more institutional recognition through bitcoin, corporations and governments should seriously consider its applications as a viable solution to some of the world’s most unconventional issues. In turn, as more technologically advanced countries continue to apply innovative solutions, industries worldwide, regardless of global status, will benefit. Thus, it is the responsibility of institutions to fully take advantage of the blockchain’s capabilities and create a more meaningful experience for its users, whether it be ensuring that safe food products are shelved at supermarkets or storing private information on a decentralized database that is immutable.
Works Cited
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