The UN has also decided to adopt the blockchain technology in order to revolutionise its aid supply methods, a step toward creating transparency in its financial system. So far its World Food Program has used the Ethereum network to deliver food vouchers worth 1.4 million US dollars. Unicef, the children’s agency of the UN, has recently launched its own project that will use cryptocurrencies as a means to raise funds. The project, which is futuristic in itself, will be used to raise funds with the ethereum blockchain network for Syrian children in need.
The UN And Unicef Get Into Blockchain
This pilot project by Unicef is part of a broader one by the UN and Unicef itself to explore various ways that blockchain technology can be used. However, Unicef is settling for ethereum – the second largest of cryptocurrencies after bitcoin – all in the bid to ensure transparency in its finances.
Blockchain technology is the underlying system that most of the popular cryptocurrencies run on. It is basically a giant spreadsheet of transactions that is maintained by an almost endless connection of computers. Its main strength is the elimination of middlemen as well keeping records that are almost infallible or can’t be falsified. The UN’s children agency must be pretty “desperate” to steer towards cryptocurrencies in particular, judging by how unpopular they have become among people and the reputation they have worldwide. Well, if you have no idea all, it’s basically this – cryptocurrencies are seen as a sham and another economic bubble ready to explode. It is also quite understandable, looking at how fast cryptocurrency transactions are and how fast the Unicef needs its funds transacted for effectiveness.
The Unicef Game Chaingers Scheme
This is the name the Unicef is giving to the project with he “chaingers” coming from blockchain and changers. What the program seeks to do is to recruit gamers who will use their heavy processing unit computers to “mine” ethereum’s cryptocurrency, the ether, for children in Syria. So far the project has managed to bring in about €900, equivalent of £795 which is not so encouraging. However, it’s still in its infancy so there is so much more it can achieve, with the right leadership and supervision.
Some goals of this program that we know are the reduction of the about 30% of budgets lost due to corruption, creation of network based portfolios for the refugee children, and the merging of all records from health all the way to education and entitlements.
What Does Ethereum Stand To Gain In This?
With a valuation of some $88bn (£62bn), Ethereum – which launched in 2015 – has an equivalent market value to Starbucks, according to Forbes magazine. But what is making Ethereum and its underlying way of operating particularly attractive to organisations like Unicef is that it can operate as a system for distributed computing.
Most people who have openly expressed their support for this initiative so far claim that this will open up smart contracts, allow transparency as projected, cut down cost, and also further automate the transactions of Unicef and the UN.
How Ethereum Has Helped So Far
The World Food Programme (WFP) adopted the ethereum network a while ago to distribute its food in refugee camps, and that has been a great success so far. It has managed to distribute $1.4 million of food vouchers using iris scanners in camp supermarkets for Syrian refugees in Jordan, and it plans to extend this to ten other camps. The Jordan project was a follow-up to a successful one that was launched a year prior to it in Pakistan.The refugees however don’t see any difference, but the WFP does. It states that it has been able to save reasonable sums that it would have paid to financial servicing institutions who would have under normal circumstances served as middlemen (something blockchain avoids), and charged them about 3.5%.
Director of innovation at the WFP stated in an interview last year that
“We feel this is a starting point, there are a number of potential uses of blockchain that could dramatically change the way we reach people in terms of our efficiency, effectiveness and security.”
The Future Of Blockchain Technology
Blockchain based systems are beginning to take over the entire business ecosystem gradually and with the WFP adopting it and making it work for them in food distribution and cash payments, more organisations will begin to venture into it.
Unicef on the other hand has three main things it plans to use blockchain technology for: the creation of a more transparent internal processing system, a new and creative way of donating money, and addressing issues like payments to partners of frontline workers, like locally contracted lorry drivers. Unicef says that the blockchain system will allow the organisation to make direct payments to its contractors without the need of any middlemen because the ethereum network handles the rest of the transaction by monitoring it every step of the way in the confirmation of transactions.
Rhodri Davies of Charities Aid Foundation expressed his support for the Unicef’s initiative as well as touching on other issues about the entire cryptocurrency world
“There’s been a big increase in interest in the last 12 to 18 months that has percolated through as it has become more mainstream. People in the aid and development world have seen business and technology firms becoming more interested, seeing more applicability to what they are doing. On the charity side, the first thing to say is that blockchain is not just about Bitcoin … Charities don’t need to be holding cryptocurrencies but focus on the underlying technology [to] solve problems.”
He however stated that adoption of blockchain technology was going to be a bit slow because of the reputation of cryptocurrencies at the moment. However, he did show some level of optimism in the end
“Everyone is really enthusiastic, but we won’t see it really take off until one of the big agencies turns its pilot scheme into full-scale implementation. I think that’s where you will start seeing a large difference.”
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