[UDC Report] Donations without supporting corrupt governments or banks
[UDC Report]-7 A total of 300,000 people died as a result of the 2010 Haiti earthquake. The American Red Cross raised around $500 million, but 40 percent of the total was spent on internal expenses. The major reason the donations can’t be fully utilized has to do with aid agencies functioning as a middleman to deliver the funds. Why is the delivery cost so high? Blockchain technology is receiving attention in the field of aid. The transparency and credibility of blockchain are seen addressing the blind spot of donations. Information about the donation - whether it is paid in cash or cryptocurrency - can be saved in the blockchain. This means that ill use of the donation can be traced. Since transactions involving donated funds can be made only after the approval of aid agency members, the chance of embezzlement is low. Expenses can also be lowered and problems of timing can be solved. Cryptocurrencies attract commissions near zero, as the money can be directly delivered to the beneficiary. The transaction can be sent in just several seconds, unlike in the past when it took up to several days. Connie Gallippi, founder and executive director of BitGive, said people in poverty can directly receive help wherever they are. There is neither a corrupt government nor a corrupt bank in the middle, according to Gallippi. Several accounts aren’t necessary at Jordan refugee camp The UN World Food Programme is an organization that actively utilizes blockchain. Its Building Blocks is a blockchain project used to help transfer money for food aid to Syrian refugees at a camp in Jordan. Houman Haddad, founder of the Building Blocks project, said blockchain can be useful when several agencies support refugees. The neutral system helps agencies cooperate, according to Haddad. Blockchain identification could save refugees Identification based on blockchain could be dangerous. The information could be misused or even be collected by terrorist organizations. That is why projects like the Building Blocks Project only collect strictly necessary information, like refugee health conditions, to post on the blockchain. Offering identification to refugees is an important issue. A total of 110,000 refugees worldwide have difficulty with identification. Some people even lose the identification they had. A lot of them have to make great efforts to prove their identity through social activities for 15 years, like marriage or employment. Financial transactions are another issue. But they can directly receive funds by means of blockchain-based identification. If transactions and payments are made possible through blockchain-based identification, other financial services like savings and loans can be utilized. Blockchain could help set the foundation for financial independence. “That has to be done” The Building Blocks Project is still at the experimental stage. It still requires close cooperation among humanitarian networks to be used extensively on aid. Identification requires a lot of cooperation among several agencies, according to Haddad. He explained that since blockchain is a relatively new technology, it has to be dealt with carefully. If investment in blockchain could help reduce costs, the money is worth spending, said Haddad. ※UDC 2019 videos and presentations can be found at https://udc.upbit.com/program/detailed_program, also the full report can be found at https://static.upbit.com/reports/udc2019_report_en.pdf. This report was sponsored by Upbit, and the information in it is based on the Upbit Developer Conference held at Grand Hyatt Incheon on Sept. 4 and 5.