Apart from the 5 key elements to life i.e. Earth, Fire, Water, Air and Ether; one thing that has been reshaping the world today is Blockchain Technology. Blockchain technology is in some way or the other penetrating into everyone's lives without. No, I am not talking from the spiritual point of view, but from an economics point of view. Yes, you got it right. The world of blockchain and cryptocurrency is filled with oceans of opportunity and we have just scooped a spoon out of it.
Keeping aside all the corporate news that you have been reading about cryptocurrency and the latest acquisitions of blockchain start-ups by blue-chip companies, the role of blockchain and cryptocurrency is way more than that. The reason why I say blockchain technology can change the world is because it has a huge potential to impact the economy of developing nations. India, Pakistan, Bangladesh, Nigeria and many such countries are densely populated with population soaring as high as 2 Billion.
The penetration of blockchain technology in developed countries like USA, Canada and Japan is way more than that of developing countries. However, in my opinion, I believe, it is the developing nations that need blockchain technology more than the developed nations. All thanks to globalization and the companies investing in these developing nations, we have got some solid examples to prove the statement.
So, let's just get down to the direct impacts of blockchain technology and cryptocurrency on the developing economies of the world.
Given the fact that even the most communist country in the world i.e. China is preaching songs of Democracy in Kashmir, Elections are indeed a vital block in the complex structure of democracy. We have seen a number of cases where the election numbers are either rigged by the dictator government or manipulated by the 'not so' neighboring country for their personal agenda.
One of the best ways to secure a transparent election is to implement blockchain technology in the election process by opting cryptographic media verification where the voters can consume media that has been stamped with a unique cryptographic identifier. Also, the distributed blockchain ledger can store the data in a secure mode where the vote of each voter is tokenized and encoded with his/her biometrics which is immediately recorded on the election blockchain network.
The blockchain technology also helps the voters become the auditors to audit his/her own ballot to confirm the total votes. Some of the countries that have tried blockchain voting are Sierra Leone and Estonia. The election in a developing nation is its way to future prosperity. Hence, having a blockchain technology in its core system indeed changes the game for a better future of the economy.
Many developing nations are agro-based economies where a big portion of their GDP comes from the agriculture sector. One of the primary reasons for the agony of farmers in the developing nation is the lack of proper infrastructure for them to sell their crops to the right buyer. With proper infrastructure, I mean the supply chain management part where it becomes difficult for the buyers and sellers (farmers and middlemen) to trace the crops in the market.
With the help of blockchain technology, the farmers and buyers get to know the status of the crop from the time of the seed plantation to the delivering of the crop. Also, the traceability is secure and is available in real-time. The involvement of third-parties in the supply chain of crops increases the cost to the farmers and to the buyers as well. However, with the help of Blockchain technology, the process is simplified in just single distributed ledger, thus saving money to all the stakeholders.
Implementation of smart contracts empowers the farmers to get rid of the long queue of intermediaries and ensure them of guaranteed payments for their crops. For a developing nation that is heavily dependent on agriculture, the implementation of blockchain indeed makes a huge impact on their economy.
With various deadly diseases spreading across many developing nations, it becomes important to keep a track on the supply chain management of the vaccines available in those regions. According to a report by researcher Aaron S. Wallace, the mean vaccine wastage rates in Nigeria are somewhere between 18% to 35%.
The blockchain technology helps in identifying who owns what, where and when in the supply chain and that too in real-time. In the case of immunization, vaccines are stored in small containers which are identified using QR Codes and the tracking is done by an internet-connected device that helps the user to know the exact location of the vaccine and the internal temperature.
The ownership of vaccines changes from the manufacturer to the distributor to the wholesalers and finally to the patient. In this long journey, the internal temperature of the vaccines may change that greatly deteriorates the quality. Blockchain technology helps to keep a regular track on the temperature metric and inform the concerned authority if the temperature overshoots the recommended range before it gets too late.
Also, the final step of vaccination is confirmed by inputting the biometric of patients on the blockchain which gives the most precise and accurate figure of vaccine coverage as compared to previously used methods. This helps in further vaccine campaigns market research and statistics. A country which not only deals with diseases but also with the lack of vaccines due to poor supply chain management, the implementation of blockchain technology indeed impacts the health of its economy in all positive sense.
Alternate Source of Fiat Currency
The depreciation of the domestic currencies against the world's leading trading currencies like US DOLLAR, EUROS and POUNDS does make the people of the developing nation worry a lot about the intrinsic value of their currency. In such a case, the developing nations which are dependent on the heavy good imports face the real brunt of failed currencies.
The reason for such failures of the domestic currencies can be attributed to the bad economic and fiscal policies adopted by the very own government. However, with the help of blockchain-based cryptocurrency, the people of the developing nations get an alternate way to buy product and services within their country.
The value of cryptocurrencies doesn't depend on the fiscal and economic policy of the government or for that matter any centralized authority in the world. One such example is Bitcoin which is vastly being accepted in various parts of the world as an alternative to fiat currency. Other cryptocurrencies which are making their way into the mass adoption by the public are Ethereum, Litecoin, Tron, Tether and many more. In the year 2009, it was Zimbabwe which stopped printing its currency and started using foreign currencies as the hyperinflation peaked to 79.6 Billion% month-on-month. In such a case, it is the cryptocurrency on which the masses can rely until the situation gets better.
So, here were some of the ways through which blockchain technology impacts the developing nations. There are plenty more. But that's a story for some other day. Do let us know your views on the articles in the comment below.