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March 30, 2020

What is blockchain without cryptocurrency?

Smartphone screen displaying BanQu app tracking cassava through a supply chain.

You may know that blockchain technology is what’s behind cryptocurrencies like Bitcoin. But blockchain isn’t exclusive to the crypto world.

If you know one thing about blockchain, it’s probably that it’s the technology behind cryptocurrencies like Bitcoin. But blockchain technology isn’t exclusive to the crypto world. In fact, some of its most exciting applications have nothing to do with Bitcoin or any other crypto.

A very simple explanation is that blockchain is a digital record that is split into pieces, called “blocks,” which are stored in multiple places. Essentially, blockchain enables record-keeping that is secure, accurate, and fast. Check out our puzzle game analogy for a better understanding of how blockchain works.

What Blockchain Means for Cryptocurrency

If the idea of blockchain as a secure, immutable record makes sense to you, you’re probably beginning to understand how blockchain has become such a critical foundation for cryptocurrencies to be built upon. Unlike your bank’s digital records, which are potentially vulnerable to hacking, corruption, or even memory loss if the servers go down (hopefully your bank has protocol in place to deal with such things), blockchain records are very difficult to manipulate. They’re virtually invulnerable to power outages (it would take a worldwide power outage to bring down an entire blockchain network), and they’re available 24/7. They’re also quite fast.

What Non-Cryptocurrency Applications are Using Blockchain?

The usefulness of blockchain doesn’t stop with digital currencies – these only represent the beginning of blockchain’s true potential. There are many non-cryptocurrency applications for blockchain that are already being implemented, and surely countless more that will be invented as more people become aware of this technology.

Identification Records

It’s easy to take your identification records for granted. You probably have your social security card tucked away in a drawer somewhere, and your birth certificate might have been left in your parents’ file cabinet when you moved out. This isn’t a problem until you need those records.

Now, imagine being homeless, or being a refugee in a camp somewhere. Regaining access to those vital documents can be almost impossible. In these extreme cases, it’s difficult not to fall into a hopeless situation where you need funds to reclaim your identity and identification records to reclaim your funds. It becomes a self-defeating cycle. With blockchain-based identification records, you retain access to those records no matter what your situation is. This makes it easier to get the help that you need to move on with your life.

If this situation sounds extreme and hypothetical, be aware that it’s neither of those things. Blockchain identity platforms already exist, and they’re being used for the exact cases described above. In the city of Austin, Texas, for example, blockchain technology is being used to identify homeless people so they have faster access to the social programs they rely upon. In Jordan, Syrian refugees are regaining access to lost identities via blockchain technology.

Online Privacy

Blockchain is often brought in to solve problems around clarity and accountability. It would make sense, then, that you’re beginning to worry about privacy. Will blockchain make digital privacy a thing of the past? Thankfully, the opposite is true.

When you’re using the Internet nowadays, it’s quite possible (highly likely, in fact) that the websites you visit – and even your service provider – are collecting data about you. This data can be used to cater ads to your particular interests, and it can also be used for more nefarious purposes.

Thankfully, there are blockchain networks in development that keep your data safe, allowing you to browse the Internet anonymously and to take back your data. The way this works is a bit complicated, but in simple terms it creates privacy because your data is being handled by mathematics on a decentralized network instead of by an organization (such as a website owner or an ISP). Your data is broken into blocks (puzzle pieces) and the pieces are scattered across the network. Only someone with the decryption key can authorize the data to be reassembled. As long as you keep your decryption keys secure, your records are secure.

Supply Chains

One place where blockchain is having a profound impact is in supply chains. With an immutable, public record of every transaction, you can trace a crop (any crop that uses the platform, at least) all the way back to the farm where it was grown, for example. You can also track a recycled item that a waste picker brings to the recycling station or plant back through production, transport and delivery.

In a world that’s growing more eco-conscious by the day, tracing resources all the way back to their source is becoming more and more important. In supply chains with little visibility, it’s hard to say whether the beverage you’re drinking comes from environmentally friendly crops, or if the clothing you’re wearing was produced using inhumane labor practices.

Blockchain brings clarity to the supply chain so the entire journey from root source to consumer is clarified. This is a win for everyone. Not only does it bring some much-needed accountability to the gathering of raw materials, but it lets manufacturers keep tabs on their suppliers, and it lets independent farmers, miners, waste pickers, and other originators collect money and create an economic identity.

Conclusion

As you can surely see by now, blockchain is an incredibly exciting technology with virtually endless possibilities. New uses for the technology are being invented all the time, and there’s no reason to believe this won’t continue far into the future. Whether you believe in the power of Bitcoin or not, it’s hard to deny the utility of the technology it was built upon.

BanQu creates blockchain solutions for some of the modern world's biggest challenges, such as supply chain transparency and identity platforms for impoverished populations. We believe that with blockchain's bright future, world poverty can become a thing of the past.