Blockchain and The Fight Against Poverty - Infinity Blockchain Labs

Blockchain and The Fight Against Poverty

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April 13, 2018

We all know that the world is changing at an incredible rate, and many problems of the 20th century have been solved. Amongst such challenges as hunger, wars, natural disasters, and pollution, poverty is one of the most significant problem; in fact, there is still a persistent battle between new technologies and poverty all over the world. However, in recent years, thanks to the advent of a disruptive technology called blockchain, the fight against has encountered some positive shifts. Below are a few of incredible benefits that blockchain has contributed to ease the problem.

Blockchain and The Fight Against Poverty

Blockchain helps to ensure Property Ownership

It is undeniable that the transparency of property ownership registration as well as preventing unauthorised, fraudulent changes to data records are crucial to our lives. Therefore, blockchain technology is considered as a powerful tool to register ownership of property, whether it is digital or non-digital. After the registration, the owner’s rights will be automatically protected, which will enable easy resolve of disputes, prevent the risks of fraud as well as ensure proper transfer of ownership.

A high multitude of developed countries has already started to adopt blockchain technology in the field of land registry records. Putting land records on a blockchain would make them immutable and tamper-proof, thus securitizing them and building a firm pillar of trust in the system. Countries such as Sweden and Georgia are in the midst of testing and implementing this blockchain-based application, with the aim to develop a land registry system which is transparent and simple. A similar project is envisioned in Honduras; however, such attempts of the Honduran government to utilize blockchain on land title projects have recently stalled. In a nutshell, registering land property ownership on blockchain offers a variety of benefits such as reducing manual errors, while enhancing security processes for transferring documents, mortgage or contracts.

Blockchain and The Fight Against Poverty

Furthermore, blockchain enables irreversible records of ownership. Once data is stored on blockchain, it can no longer be tampered with. And it would be a deficiency if we didn’t mention the application of smart contract, which helps ensure automatic transfer of ownership if the right conditions have been met. This means that buyers and sellers would be fully protected from fraudulent actions.

Reducing transaction costs

A 2016 study found that emigrants working abroad had sent an estimated US$442 billion to their families in their home countries. This global flow of cash is a significant factor contributing to the financial well-being of families and societies in the developing nations. Nonetheless, the process of sending money overseas can be very costly, and often the poorest get hit the hardest.

With the help of blockchain technology, everything seems to be completely transformed. Blockchain eliminates the need for trusted third parties to manage transactions and keep records. One such company utilizing blockchain technology to make money transfer more affordable is Bitspark. Bitspark is an international remittance platform based in Hong Kong that leverages blockchain to significantly lower the transaction costs, offering a competitive flat rate around HK$15 for remittances of less than HK$1200 (about $2 in U.S. currency for transactions less than $150) and 1 percent for larger amounts. Using the secure digital connections of a blockchain system allows the company to bypass existing banking networks and traditional remittance systems. Bitspark is just one example of how blockchain technology can help bridge the poverty gap. There are many other blockchain-based solutions that are designed to put the power in individuals’ hands, making money transfer a lot easier and affordable.

Blockchain and The Fight Against Poverty

Encouraging Decentralised Identity

One of the most essential advantages of blockchain is that it can establish a shared database, which allows stakeholders to easily access, update, and record. Specifically, in the financial services industry, settlement times will be significantly reduced, which would later save costs and eliminate the risks of fraud or errors.

On the other hand, a significant number of blockchain startups have already studied and established a blockchain-powered digital identity, which could be used across organisations and eventually even across borders. Companies working on such innovative solutions include ShoCard, BitNation and BanQu. In particular, Shocard has set up a blockchain-powered identity system that enables individuals, business and governments to establish, verify and exchange identity information in a private and secure way; while BitNation focuses on providing identities for refugees. BanQu is an identity blockchain-based platform that enables individuals to create a personal digital profile including personal, financial and many other records to build a 360-degree economic profile that can further be used across organisations.
It can be said that once charities and non-profit organizations start collaborating and using the same shared database on the blockchain basis, the entire process of helping the poor would appear to be a lot more effective and cost-efficient.

Insurance

Blockchain and The Fight Against Poverty

A growing number of poor people living in the developing countries cannot afford health and life insurance, due mainly to its expensiveness compared to income. It is estimated that only 15 percent of the entire population in India is able to purchase their own health insurance. Indian citizens even have to pay higher relative premiums than those in developed countries. Generally speaking, people in South Asia pay a much greater share of their health care costs out of their own pockets than do people in high-income industrialized countries. However, thanks to the adoption of blockchain and the cost efficiency it brings to our lives, fraud now can be detected and costs for insurers can be dramatically reduced.

While blockchain technology is still in its infancy, there are already a number of promising use-cases and applications, especially in the field of financial services. By providing a means to achieve secure identification, ownership transparency, low transaction costs and better insurance system, blockchain can become a paradigm shift for the poor, helping them upgrade their lives and leave the roof of poverty behind.

About Article Publisher Infinity Blockchain Labs

Infinity Blockchain Labs is a visionary R&D company engaged in intermediary and RegTech services employing blockchain technology. We focus on forming alliances with established businesses and regulatory institutions across various industries, as well as providing collaborative incubation for early stage blockchain projects.

IBL aspires to empower Vietnam to become a global leader in blockchain development and therefore are committed to sharing information to nurture a passionate, educated blockchain community. One of the ways we maintain our role as ecosystem pioneer is by helping create educated blockchain enthusiasts. We are committed to sharing information and resources to help Vietnam become a blockchain hub through conferences, courses, contests, alliances, workshops, speaking engagements and incubations. Information regarding topics like hard forks helps people become more familiar with key blockchain concepts and thus able to adopt the technology.
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