OXFORD, United Kingdom — Plenty of people are asking whether the potential of blockchain for good is hype or reality, but a new report released on Thursday claims to be getting closer to an answer.
RippleWorks Foundation and the Center for Social Innovation at the Stanford Graduate School of Business detailed their findings in a report called “Blockchain for Social Impact: Moving Beyond the Hype.”
Doug Galen, co-founder and CEO of RippleWorks, which pairs Silicon Valley experts with social ventures in emerging markets facing scaling challenges, presented the findings of a study on 193 blockchain initiatives dedicated to social good at a breakfast at the Skoll World Forum.
The four most promising social impact applications of this distributed ledger technology are in transparency, immutability, lower cost payments, and identity, Galen explained. Much to his surprise, of the 193 blockchain initiatives the students catalogued, there were nearly twice as many health initiatives as financial inclusion initiatives, at 25 percent and 13 percent, respectively. Eleven percent of those blockchain for social impact efforts were categorized as philanthropy, aid, and donors.
“It’s not technology first, it’s people first. Identify first what you’re trying to work on. Then figure out if the technology works for you.”— Doug Galen, co-founder and CEO of RippleWorks
Speaking to a room of founders and funders and others interested in the potential of distributed ledger technology to accelerate their work, Galen said the impact of blockchain in the sector was already happening and set to accelerate. The report found that while 74 percent of the blockchain projects graduate students evaluated are in concept or pilot phase, 55 percent are expected to have an impact on people in the next year.
“It’s not technology first, it’s people first. Identify first what you’re trying to work on. Then figure out if the technology works for you,” he said, describing the approach he suggests leaders in social good take in evaluating whether blockchain might bring value to their work.
The report outlined the benefits of what is essentially an unchangeable system of record keeping across a range of sectors.
“One of blockchain’s primary benefits to philanthropy or aid is that it enables a donation to be traced through every step, from donor to recipient, and records every action and intermediary along the way,” the report stated. “Additionally, the use of smart contracts enables the determination of specific conditional milestones that must be reached before funds are disbursed.”
The authors of the report point to Alice as one example. The Alice platform incentivizes organizations to run their projects more transparently because they are paid more when they reach their goals.
“All donations are held in smart contracts and only disbursed once milestones are reached and verified,” the report reads. “Donors can track their donations, and the performance of each project is publicly available, making it easier to identify and help scale projects that are most effective.”
At one point, Galen highlighted the kinds of efforts needed to take blockchain from hype to reality, by standing before a slide with two articles side by side. One was an article about how Long Island Iced Tea Corporation’s shares soared after the company changed its name to Long Blockchain Corp. Next to that was an article about ixo Foundation, which leverages blockchain for sustainable development, about its work to help South African schools access government subsidies.
In a recent webinar, experts from the World Economic Forum and Mercy Corps told Devex that the global development community needs to understand how the technology works, the potential use cases, and whether it might add value to their work. This new report could serve as a useful tool in doing so.
Editor's note: Devex traveled to the Skoll World Forum with the support of the Skoll Foundation. Devex retains full editorial independence and responsibility for this content.