Bitcoin and blockchain technology are all over the press for the recent, apparently unstoppable surge of bitcoin price. But blockchain technology is also in the scientific press, with articles published in the prestigious journals Nature and Science, which cover possible important roles of blockchain technology for environmental issues.
Writing in the prestigious journal Nature, Guillaume Chapron, an ecologist at the Swedish University of Agricultural Sciences in Riddarhyttan, argues that “The environment needs cryptogovernance.” According to Chapron, blockchain technology can support sustainability by building trust and avoiding corruption.
“If humans repeatedly fail to build trust, perhaps algorithms should replace them,” says Chapron. “The environmental crisis is growing partly because of a lack of trust — the increasing distance between multiple actors who are unknown to each other, from companies and governments to individual consumers, creates many opportunities for fraud and failed policies.”
“The time is ripe for ‘cryptogovernance’, in which trust, law and enforcement are outsourced to computer code. For sustainability, blockchain technology could be a game-changer. It can generate trust where there is none, empower citizens and bypass central authorities. It could also make existing institutions obsolete, including governments, and raise fierce opposition. Laws could be replaced with ‘smart contracts’ written in computer code.”
According to Chapron, the potential benefits of blockchain technology for protecting and managing the environment include:
- Certifying ownership of natural resources. For example, a certificate stating a community owns a forest can be logged in a blockchain with a time stamp and verified.
- Tracing physical goods throughout their life cycle, and tracing the ecological footprints of commodities via the Internet of Things, with sensors recording the environmental impacts of manufacturing processes.
- Empowering unbanked communities to receive direct payments in bitcoin for ecosystem services or for meeting conservation targets.
- Enabling better policy making via blockchain voting and decentralized sharing economies.
Chapron argues that smart contracts could manage natural resources. “For example, a quota for extracting natural resources could be issued to a community only after remote sensing data have proved that the community has met conservation targets,” he says.
Science, another prestigious journal – Science and Nature are often considered as the top two scientific journals – has published an interview with Chapron.
“The environmental crisis grows in a fertile ground, which is the multiplication of intermediaries,” says Chapron. For example, “if you buy a fish at the supermarket, the supply chain is very long. The supermarket might not even know where it came from. And so there are multiple opportunities for environmentally unsustainable goods to enter the supply chain.” Using blockchain technology for supply chain management would permit the supermarket – and the consumer – to quickly and easily trace each and every step.
Not that there aren’t important challenges that must be solved for blockchain technology to realize its full potential for environmental issues. According to Chapron, the very limited throughput of current blockchain technologies is an important concern, and better scaling solutions are needed. “And then the big irony is that the blockchain is a giant sucker of energy,” notes Chapron. “What’s needed is to develop a more energy-efficient algorithm.”
“When people understand more and more what the blockchain will allow, they will have more and more new ideas that we can’t imagine today,” concludes Chapron. “My paper is intended to stimulate thinking.
Picture from Wikimedia Commons.