Originally published on the International Legal Technology Association (ILTA) blog.
Blockchain Technology, the underlying system of Bitcoin, could help democratize the way we store data, prove ownership, and create verifiable trust relationships. The blockchain is a global, public database, or ledger, of transactions. When a transaction, like paying a friend is initiated, a network of computers use algorithms to validate that your account has enough money. Once validated, the record of your transaction – in the form of a “block” of data – is added to a chain of other people’s previous transactions. Once a transaction is made, it cannot be changed. And while you and your friend are anonymous, anyone can access the record of your transaction.
There is no need for middlemen because on the blockchain trust is established through mass collaboration and code. Because a transaction cannot be changed once it is added to the blockchain, there is a reduced risk of record disputes or financial pilfering. This could save consumers up to $16 billion in banking and insurance fees per year.
For example, Sweden is creating the first blockchain-based land title registry as a way to record property transactions. This could save the Swedish taxpayer over $106 million a year by eliminating paperwork, reducing fraud, and speeding up transactions. The Swedish system operates on a private blockchain. The land authority and others, like banks, hold copies of the records. When a land title changes hands, each step of the process is verified and recorded on the blockchain. The system acts as a highly secure and transparent verification and storage service for property transactions.
In emergencies, people still need to make purchases, but might have all traditional forms of identification or credit no longer available to them. The United Nations World Food Programme deployed blockchain to allow refugees in Jordan to pay for their food. “Through blockchain, we aim to cut payment costs, better protect beneficiary data, control financial risks, and respond more rapidly in the wake of emergencies,” explains WFP director of innovation and change management, Robert Opp.
These are just a few blockchain initiatives, but there are many more in virtually every industry and across the globe. To learn more about Blockchain, visit:
Resources for Learning about Blockchain
Blockchain Roundup – A Guide to ILTA & Non-ILTA Blockchain Content
