Blockchain Future 2: The Expected Future Use Cases Of Blockchain

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Published April 12, 2023

In the digital world, as Web 3.0 is finally gaining attention as mainstream, the effective use of blockchain is being explored in all genres of the world. It is no exaggeration to say that the expectations and possibilities for blockchain are endless, thanks to its transparency, safety, non-falsification, and low cost and speedy transactions.

Therefore, this time, we will divide the fields where blockchain implementation is expected into three categories: government, society, and environment.

Blockchain in Government Problems

Blockchain is highly expected as a trump card to solve government problems in countries around the world. Let’s take a closer look at the three areas of “international remittance,” “tax payment,” and “infrastructure.”

International Money Transfer

When making international remittances, in most cases, it is necessary to use an international payment system called SWIFT, which was established in 1973. However, when it comes to actual remittance, it is common knowledge that it takes more than 3 days to transfer money to a designated account in the other country via multiple financial institutions, which requires high fees.

Despite this, there is no substitute for this system, which has been in use for about 50 years, so it still has an absolute presence. As proof of that, the international community decided to exclude Russia from SWIFT in 2022 in order to impose economic sanctions on Russia, which invaded Ukraine.

Blockchain is attracting attention as an alternative system to SWIFT. With blockchain, there is no need to go through a financial institution, so remittances are completed in just a few seconds, regardless of location. It will be possible to send money to and from people who are said to have 2.5 billion people in the world who do not have bank accounts. Smart contracts can be used to provide various financial services other than remittances, so the significance is immeasurable.

Tax Payment

Since international remittances are theoretically possible, it is safe to assume that domestic tax payments using blockchain are not systemically impossible. If you want to transfer money at a bank or ATM, you have to go out of your way to bring money, and depending on the time or day of the week, you may not be able to transfer money, or you may have to pay extra fees.

On the other hand, blockchain enables speedy remittance at any time without going through a financial institution and without being bound by time or place. Of course, it is a safe and secure system that is perfect for tax payment because it will record who paid the tax, when and how much, and it will never disappear or be rewritten. However, introducing it all at once would be too difficult both physically and financially.

Infrastructure

Looking at the two examples above, it can be said that the potential of blockchain as a social infrastructure is endless. In addition, for example, in Japan, the payment of benefits related to the new coronavirus has been delayed and has been criticized quite a bit. However, in Estonia, which already manages the personal information of all citizens on blockchain, the payment to the eligible people was completed in just two weeks.

With that in mind, if you use blockchain, you can send money safely, reliably, and quickly without going through a financial institution, saving time and effort. It can definitely be reduced significantly.

Society Problems

Next, let’s introduce the fields where blockchain is expected to be used as a solution to social issues, including the private sector.

Food Traceability

The circle of blockchain utilization for the purpose of food traceability is rapidly expanding, mainly in Europe and the United States. We track all processes related to production and sales, from the source of raw materials, the factory where the product was produced and processed, the distribution warehouse where the product was packed and shipped, to the wholesaler and retailer.

Since there is no central authority and all nodes act as servers to manage and share the same information, food safety is ensured, and even if a crime such as food poisoning, contamination, or theft occurs, the cause can be investigated. You will be able to do it quickly and reliably. Of course, the role as a deterrent against such troubles and fraudulent acts is also tremendous.

Logistics Problems

Logistics is one of the industries where blockchain is highly expected to be used. As with food, if you can track your package, you can flexibly respond to any risks in the supply chain.

A frequent problem in international trade and cross-border EC is the falsification and unauthorized rewriting of information on packages. The process of manufacturing a single product overseas, packaging it, and delivering it to consumers in Japan via warehouses, airports, and seaports is not a simple process. It can be said that the process of entering the country through not only manufacturers and wholesalers, but also multiple carriers, warehouse operators, and forwarders, including administrative procedures, is extremely complicated. On the flip side, it can become a hotbed for fraudulent acts such as impersonation and rewriting because there is no one to consistently monitor all the details.

Therefore, if we use blockchain, it will be possible to track end-to-end from the country of origin, production factory, production date, production manager, delivery company, and airports and ports through which it was routed, and share it with all parties concerned. The inspection process for package contents and information can then be greatly streamlined.

In order to increase corporate value and product value and gain high trust from customers and stakeholders, some of the world’s leading e-commerce platforms and manufacturers have already teamed up with logistics companies to make extensive use of blockchain. Many are starting to do so.

Education

Efforts to manage personal records at educational institutions, such as graduation certificates, course histories, research histories, and awards, have already begun overseas. This will reduce the falsification of educational backgrounds and backgrounds and can be used by companies and other organizations as reliable proof when recruiting students.

If papers and works are also digitally managed using tokens, it is possible to reduce the risk of being illegally abused or used for plagiarism.

Vaccine

A vaccine passport has become a global focus in the new coronavirus epidemic. This can also be issued using the blockchain. Medical institutions and local governments, airports, public facilities, event venues, etc., can cooperate with each other and make it into an app format that can be used on smartphones so that you can prove negative at the place you visit.

By using blockchain encryption technology, it is possible to prevent third parties from viewing information other than the minimum necessary personal information, such as details of underlying diseases and allergy information, so it is possible to eliminate the risk of leakage.

Environment Problems

The use of blockchain is also progressing in the field of environmental conservation. If blockchains ensure the speed, transparency, and safety of transactions, they will be of great help in building a sustainable society. Let’s take a look at a range of examples, including optimizing energy use, recycling, and combating deforestation.

Energy

It has been a long time since individuals and companies, not electric utilities, have been able to buy and sell surplus power generated by solar power. The mechanism is that the electric power company acts as a central administrator and sells the electric power purchased from the seller to the consumer.

However, in this case, transactions can only be conducted under the control of electric power companies, and it is difficult to say that they are liberalized in the true sense of the word. Therefore, if blockchain is used, all the computers of the seller and the buyer will be connected one-to-one by P2P, and it will be possible to buy and sell directly. All transaction data remains on the block and can be viewed from each computer, ensuring safety and transparency

In conventional blockchains, there was a process in which block generators were determined by the speed of mining, which performs advanced calculations using high-performance computers. However, joint research by Mitsubishi Electric in Japan and the Tokyo Institute of Technology has now developed a decentralized algorithm that can optimize surplus power trading with a small number of calculations. As a result, it is now possible to search for the optimum combination and conclude a transaction, taking into account the amount of demand and the amount of supply available for each. Moreover, by suppressing mining, we can expect a reduction in the amount of electricity required and a decarbonization effect.

If this system is implemented, electricity can be bought and sold freely between individuals and companies regardless of time and place, and the price will be stable, which is expected to contribute to the spread of renewable energy.

Recycling

In the recycling of plastics and PET bottles, the process of collecting used resources, washing, sorting, pulverizing, recycling, and recycling is extremely complicated. So, it is not easy to accurately grasp how efficiently collected resources are being used for recycling.

Therefore, the traceability of recycled resources is an effective way to reduce environmental impact and pursue maximum sustainability. Moreover, by using blockchain, data in each process can be centrally managed, so it can be useful not only for understanding the current situation but also for developing recycling methods that further improve sustainability.

Agriculture Problems　

There are many opportunities for agricultural products to be exported not only domestically but also overseas. Before it reaches the consumer, it goes through trading companies, brokers, airports, logistics companies, wholesalers, and retailers. Perishable foods are easily damaged, and their storage conditions are greatly affected by the transportation environment, such as temperature and humidity. On the other hand, even if the product value declines, it was a big issue that it was not possible to clarify where responsibility lies.

If blockchain traceability becomes possible, it will help build a safer, more secure, and more accurate supply chain.

Illegal Deforestation

Illegal deforestation is becoming a serious problem in many regions, both domestically and internationally. Once harvested, the source of the timber becomes unknown, so it is not uncommon for timber to enter the market without being noticed as illegal.

Therefore, if the traceability of legally harvested timber becomes possible using blockchain, it can be expected that illegal timber that cannot enter the process will be sorted out and eliminated from the market.

Summary

The transparency, tamper resistance, speed, robustness, and functionality of blockchain are clear and groundbreaking, and full of attractiveness and future potential not found in other systems.

The focus will be on what kind of situations and applications this can be used for, and how the government, local governments, companies, and individuals can form partnerships and introduce the system most appropriately.

The introduction of blockchain is steadily spreading in every field. Various demonstration experiments are also being conducted, but if these movements become even more active and reach a critical mass (critical point), there is a good chance that at some point they will spread all at once beyond the boundaries of industries and regions.

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