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How blockchain technology is redefining the world of social entrepreneurship

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Nicolas Dejung
Monks

WWith rising prices and the impending halving of Bitcoin, blockchain technology is currently on everyone’s lips. While many associate it mainly with the financial market and cryptocurrencies, I would like to take this opportunity to shine the spotlight on a completely different, but at least equally important, facet of blockchain: its enormous potential in the field of social entrepreneurship. In our interconnected world, faced with multiple social, cultural and environmental challenges, blockchain offers innovative approaches to bring about positive change. By presenting three innovative use cases, I would like to show how blockchain can transform social entrepreneurship and what exciting new opportunities it opens up for all of us.

Creating transparency and trust: the example of BitGive

One of the most fundamental characteristics of blockchain is its ability to bring transparency to processes. Charities are often criticized because donors can rarely see exactly how their donations are used. The administrative burden and associated costs also reduce the efficiency with which aid gets to where it is needed. This leads to a distrust of charitable work and prevents potential donors from offering financial support.

BitGive recognized this challenge and launched a platform called GiveTrack. GiveTrack is an innovative donation platform based on blockchain technology. It allows donors to track their financial contributions in real time and see exactly how their funds are being used. Using blockchain technology, GiveTrack ensures a high level of transparency and security by providing an immutable, publicly viewable record of all transactions. (BitGive, 2024)

An exemplary project on this platform was the initiative by the charity Whisper to provide much-needed medical support in Uganda. Faced with a children’s hospital and maternity ward in Jinja, Whisper faced the enormous challenge of transporting critically ill patients safely and efficiently. The difficulty in finding suitable emergency transportation has led to the deaths of hundreds of children and newborns each year. (GiveTrack, 2021)

Figure 1: Whisper/GiveTrack Project (GiveTrack, 2021)

To remedy this situation, Whisper set a goal of raising enough funds to purchase a specially equipped ambulance. The initiative planned to raise $8,000 to cover a significant portion of the total cost, with the remaining amount coming from other sources. Excess funds were reserved for ambulance equipment or operating costs. (GiveTrack, 2021)

Amazingly, the goal was not only met, but exceeded with a total of $13,371.94 raised, in just 48 days. This impressive achievement highlights the effectiveness and engagement of the global community when mobilized through transparent and secure platforms like GiveTrack. (GiveTrack, 2021)

Whisper is committed to providing regular updates on ambulance usage, ensuring a lasting connection between donors and the project (GiveTrack, 2021). This initiative not only saved the lives of many seriously ill children and mothers, but also set new standards for efficiency and transparency in the use of donated funds.

Increasing productivity: the example of AgriLedger

Another key feature of blockchain technology is its ability to increase productivity through increased transparency and efficiency. In the agricultural sector, where complex supply chains and unequal power relations often lead to injustice, blockchain can bring about a real paradigm shift. Small-scale agricultural producers, particularly in developing countries, face many challenges, including lack of market access, unfair pricing by middlemen, and lack of information needed to make informed business decisions ( Yankson, Owusu and Frimpong, 2016). Together, these factors not only reduce the efficiency and productivity of farmers, but also affect their income and quality of life.

AgriLedger uses blockchain technology, a specialized form of distributed ledger technology (DLT), to fundamentally change the agricultural supply chain and empower smallholder farmers in Haiti. This innovation allows farmers to sell their mango products directly to the American market without resorting to middlemen. Since its launch in 2019, the project has disrupted traditional supply chains that often exclude farmers by giving them control of their products until they are sold in the United States. Blockchain technology provides transparency by recording every transaction from farm to consumer in a digital ledger, allowing farmers to track their products and be directly informed of sales. (Wiget, 2021)

Not only has this technology improved trust, it has also equipped farmers with crucial data to make informed decisions, access credit and potentially increase their income significantly. By implementing blockchain technology, transactions are immediately verifiable. This contributes to a significant 24% increase in farmer productivity and a 40% increase in overall supply chain efficiency. (AgriLedger, 2021)

This initiative promotes a fairer and more transparent global trading system, with the success of the project impressively demonstrating the transformative potential of blockchain in agriculture in developing countries.

Promoting sustainability: the example of Tidey/BanQu

Blockchain technology is also revealing its potential as a powerful tool in the fight for a more sustainable future. Faced with the global challenge of plastic pollution, which threatens ecosystems and endangers human and animal health, this technology offers a glimmer of hope for effective and transparent environmental protection measures.

Tidey, a company dedicated to collecting natural plastic, is using blockchain technology in partnership with BanQu to develop a solution to Guatemala’s plastic crisis. This country faces significant challenges related to plastic pollution, which not only harms the environment but also affects the quality of life of its citizens. Tidey acknowledged that approaches to tackling plastic pollution often fail due to a lack of transparency and traceability, making it difficult to assess the effectiveness of recycling and clean-up initiatives. (BanQu, 2024)

By introducing a blockchain-based platform to record and validate plastic credits, Tidey is innovating in the fight against the plastic crisis. The partnership with BanQu allows transparent and tamper-proof tracking of recycled plastic, from waste collectors to the issuance of plastic credits. Each step of this process is documented using blockchain technology, ensuring transparency and security in the plastic collection and recycling chain. (BanQu, 2024)

Figure 2: How it works (BanQu, 2024)

Since launching this initiative in March 2023, Tidey has seen considerable success. More than 100 waste collectors have been registered on the BanQu platform, enabling the collection and recycling of more than 250,000 pounds of plastic waste. This amount of recycled materials was converted into verifiable plastic credits, the sale of which resulted in a 47% increase in revenue. These figures are proof not only of the economic success but also of the positive environmental impact of the initiative. (BanQu, 2024)

Additionally, the collaboration between Tidey and BanQu demonstrates how blockchain technology can be used to solve complex challenges such as double counting and greenwashing. By attributing each plastic credit to a verifiable source, this system strengthens buyers’ confidence in the authenticity of their sustainable investments. This not only promotes a cleaner environment, but also opens new revenue streams for Tidey by transparently demonstrating its eco-friendly efforts. (BanQu, 2024)

Conclusion

After reviewing these three fascinating use cases, I am deeply impressed by the power of blockchain technology to drive social entrepreneurship. These projects demonstrate how blockchain not only has the potential to disrupt traditional business models, but also to address important social, environmental and economic challenges. Blockchain’s ability to bring transparency and trust to previously opaque processes creates a new level of accountability and efficiency. This technology represents a kind of revolution, especially in the social sector, where the need for transparency in the use of funds is high.

However, widespread implementation of blockchain technology also faces challenges. These include the need for comprehensive digital infrastructure and the lack of public understanding and trust in technology. This requires ongoing educational work to make the benefits and functionalities of blockchain technology understandable and thus promote wider acceptance.

Despite these challenges, I am optimistic about the potential of blockchain technology to play a central role in social entrepreneurship. The projects presented are impressive examples of how innovative technologies can be used to bring real, positive change to the world. However, it will take a joint commitment from developers, businesses, governments and civil society to create the conditions for the successful implementation of this technology and make its benefits accessible to all. I am excited about the future and how blockchain will continue to be used to develop sustainable and equitable solutions to the most pressing problems of our time.

The references

AgriLedger. (2021). Haiti case study. Accessed in April 2024 on AgriLedger: http://agriledger.com/case-studies/

BanQu. (2024). Tidey Case Study. Retrieved from BanQu: https://www.banqu.co/case-study/tidey-banqu-plastic-credits

BitGive. (2024). About Us. Retrieved April 2024 from BitGive Foundation: https://www.bitgivefoundation.org

GiveTrack. (2021). project details. Retrieved April 2024 from GiveTrack: https://www.givetrack.org/project-details/117/An-ambulance-for-our-Magical-Children’s-Hospital-in-Uganda

Wiget, L. (May 18, 2021). When mango producers meet the Agriledger blockchain. Retrieved April 2024 from Atlas of the Future: https://atlasofthefuture.org/project/agriledger-farm-blockchain/

Yankson, P.W., Owusu, A.B., and Frimpong, S. (2016). Challenges and strategies for improving the agricultural marketing environment in developing countries. Journal of Agricultural and Food Information, 17(1)49-61.

This article was written as part of an assignment for the course “Introduction to Social Entrepreneurship” at the University of California at Berkeley (Blum Center for Developing Economies).

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