Can Blockchain Save The Environment?

Cryptocurrencies have been discussed widely in the news recently. The concept may sound confusing to those unfamiliar with it, but it is not actually that difficult to grasp. Cryptocurrencies are essentially currencies which are created and used online. They are decentralised, which means any authority or government does not control them. Despite many large scandals and widespread debate around the future of Bitcoin, cryptocurrencies are considered to have the potential to be the future of money. However, technology enthusiasts worldwide will recognise that it is the blockchain technology behind Bitcoin, making it so revolutionary.

What is Blockchain Technology?

In the past, transactions have always relied upon a central authority, such as a bank or government, to perform the role of ‘middleman’ to validate transactions and keep records. This role is to ensure people that they are making transactions that are reliable and trusted. The purpose of blockchain technology is to remove the need for this central authority.

Blockchain is essentially a decentralised database which stores all the information associated with digital transactions made using Bitcoin. This is also known as a distributed ledger. Blockchain technology allows anyone to access the network, as long as they have been given membership. Alternatively, public blockchain networks are available for some specific uses, which are visible to anyone just as the internet is.

Blockchain technology works by grouping together transactions into a single block which is protected by cryptographic technology. Bitcoin miners have to validate the transactions in the block by running software, which uses their computers processing power, to solve complex mathematical problems. Once the problem has been solved the transactions are given a timestamp and added to the chain, so that every single transaction made using Bitcoin is visible to the rest of the network. The purpose of this is to make it more trustworthy to make transactions using Bitcoin. Blockchain technology has been described as having the potential to completely change the world as we know it.

How Can it Help the Environment?

Although blockchain technology is typically associated with Bitcoin, it actually has many purposes. The technology can be used for any form of record-keeping, such as medical records or storing important data for businesses. The technology makes it possible for the information to be shared around the world effortlessly. Many leading banks, such as the Deutsche Bank, Barclays and Santander, have been experimenting with using blockchain to make it possible for payments to be made around the world quickly and easily.

So, how can this technology help the environment? Currently, a large portion of the world lives in consumerist societies, where material goods are bought and discarded with little consideration into the processes involved in manufacturing, transporting and, ultimately, disposing of them. These manufacturing processes have an enormous impact on the environment and contribute heavily to global warming.  Blockchain technology could help to hold companies accountable for the environmental damage they are inflicting around the world. This could be achieved if a ledger was created, making it possible for buyers to see the origins of their goods with complete transparency.

Another way in which blockchain can help the environment is by assisting with making land transfers more legitimate.  Many countries promise land to indigenous peoples to continue their cultural traditions and way of life, only to revoke this deal if it is discovered the land is home to valuable natural resources, like crude oil or minerals. Corrupt governments have been known to completely rewrite land registries to help their economies, with little regard to the environment or the people who live there. Using blockchain technology to store land registry information reduces the potential for this to happen. Everyone can see who owns the land, and any changes made to the blockchain will be immediately noticed. Some countries are already using blockchain technology to store their land registry information; the Republic of Georgia has already experimented with using blockchain technology to validate all property transfers. If successful, blockchain technology will likely expand throughout Ghana and the West Africa region to help people there to have proof of their land ownership.

Besides offering solutions to some wider issues, blockchain technology also encourages paperless transactions and ways of working. This is highly beneficial for the environment as it reduces the need for deforestation around the world. Deforestation is having a huge impact on global ecosystems- threatening endangered wildlife and destroying areas of land.

The Future of Blockchain Technology

Overall, blockchain technology has the potential to improve the way global businesses operate dramatically. In particular, blockchain technology could make many processes far more transparent, making it harder for corporations to take advantage of low-cost manufacturing methods highly damaging to the environment. The reliability that comes from having transparent data available for everyone in a network also makes it harder for corrupt governments to exploit land areas.

In the future, we could see blockchain technology being utilised in a range of businesses and industries as a step towards making data widely accessible around the world. In particular, the financial sector will benefit from this technology as it allows transactions to be made quickly and easily across the globe. Many industries are already becoming paperless to reduce damage to the environment; implementing blockchain technology can only encourage this progress. A future with less use of resources is one which we should celebrate.

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