Beyond bitcoin: Blockchain firms look to provide social good

BOULDER — Blockchain can have uses far beyond financial technology and could be ideal for a variety of social impacts, according to the Boulder Startup Week panel “Creating Blockchain Models for Social Impact.”

The concept of Web 3.0 — the stage that goes beyond the last few years’ social-driven Web 2.0 — is one of many definitions, but primarily envisions an Internet that values privacy, is anti-monopoly, is constantly available and uses technology such as artificial intelligence.

The privacy and lack of a central point of control aspects are where blockchain technology — a digital ledger stored across a network that is distributed, not copied and constantly updated — comes into play.

Because blockchain isn’t stored in a central location and can’t be corrupted, it provides the foundation for an Internet that can be democratic and for everyone. It’s transparent, immutable, distributed and doesn’t require that a single administrator or group of administrators be trusted.

It also provides more value than just the foundation for a type of currency, said Kylen McClintock, founder of Blockchain for Sustainable Development.

Possible social good applications include peer to peer lending, digital identities (ideal for refugees), protection against runaway inflation, campaign finance reform, direct democratic votes, solar energy trading and freedom of speech free from censorship.

The social impacts of blockchain are numerous, but several local adopters already are considering ways to use blockchain for social good.

  • Native Token is a company that provides a protocol for community economics. People can join a network, called a Tribe, for a cause they care about. The Tribes are backed by their community members, which are in turn in possession of tokens. Tokens are generated through completing tasks. Tribes are also backed by a reserve of tokens and have a development fund that can be spent on projects. Native has a liquidity pool of Ether and Bancor Network Tokens, which provide the convertibility for their in-house tokens.
  • The Distributed Giving Project is a Denver-based initiative that gives cryptocurrency to the homeless so that it can be spent on goods. The project was started by Sasha Shtern, who wanted a way to give directly to homeless teens, rather than have them wait in line for food at a shelter they might not be able to get to, but realized there’s a belief that when given money those who are homeless will spend it on things other than food and necessities. A small pilot incentivized members of the Denver Rescue Mission’s recovery program to continue in the program by giving them $10 of Bitcoin every other day and found a food mart that would accept Bitcoin. The project is now considering a phase two, where they create their own cryptocurrency. The plan would be that nonprofits helping the homeless that have partnered with DGP would incentivize behavior by providing the DGP cryptocurrency. The homeless could spend that on goods and services at vendors, who in turn would be getting a new revenue stream they didn’t previously have. DGP cryptocurrency would have a one to one ratio with the dollar, and dollars would be provided by donors who were looking for a safe secure way to provide money to the homeless, as all purchases would be tracked on the DGP ledger.
  • Flux, an Israeli company with a Boulder office, is using blockchain technology to collect data on agriculture and the environment. The Flux system collects data from crowdsourced sensors and also has a token that creates a peer-to-peer marketplace between farmers and consumers. The company plans to launch later this month.