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Blockchain Use Case Failure: 43 Projects and Zero Impact Found

By Wayan Vota on December 10, 2018

blockchain international development

Blockchain and other distributed ledger technology offers the potential for radical transparency in data collection, management, and use across international development. Blockchain technology creates a public, shared, and yet immutable database managed by its users.

Development participators are already using blockchain technology, for example:

However, we need to get past the press releases, white papers, and blog posts about potential blockchain use cases or general blockchain lessons learned and understand the real impact that distributed ledger technology can have on humanitarian relief and international development.

We need to have real monitoring, evaluation, research, and learning (MERL) on blockchain interventions so we can separate fact from fiction and develop and evidence base for when and how we should deploy this new approach.

What Is Blockchain Impact on Development?

For the MERL Tech 2018 conference in Washington, DC, three MERL practitioners, John Burg, Christine Murphy, and Jean Paul Pétraud, documented 43 blockchain use cases through internet searches that were often written about with grand claims of outputs, outcomes, and impact. In a MERL Tech post they revealed their results:

We found no documentation or evidence of the results blockchain was purported to have achieved in these claims. We also did not find lessons learned or practical insights, as are available for other technologies in development.

We fared no better when we reached out directly to several blockchain firms, via email, phone, and in person. Not one was willing to share data on program results, MERL processes, or adaptive management for potential scale-up.

Despite all the hype about how blockchain will bring unheralded transparency to processes and operations in low-trust environments, the industry is itself opaque. From this, we determined the lack of evidence supporting value claims of blockchain in the international development space is a critical gap for potential adopters.

Their results are similar to others who have gone looking for documentation of blockchain impact beyond the hype cycle.

  • David Gerard examined the much publicized World Food Programme blockchain project and found that the  blockchain was Ethereum, modified by Parity to run a private blockchain without mining, with only one entity was on it. So the WFP project wasn’t actually a true blockchain, it was more a cluster of four redundant databases.
  • Matt Crum looked for impact with Aid:Tech’s blockchain project in Lebanon, and found scant evidence of impact. Their website has two short paragraphs about their blockchain project, with very basic information on the project, and a handful of photos, and a graphic that presents benefits of the program in 8 bullet points.

We Need Blockchain Impact Honesty

If blockchain technology is going to move through the Hype Cycle, past the Trough of Disillusionment, up the Slope of Enlightenment, and onto the Plateau of Productivity, blockchain firms need to be transparent about their pilots and share the real data and outcomes of their demonstration projects.

International development practitioners need to be convinced with hard data about when and how distributed ledger technology will increase outcomes and decrease expenses for them and their constituents.

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Written by
Wayan Vota co-founded ICTworks and is the Digital Health Director at IntraHealth International. He also co-founded Technology Salon, MERL Tech, ICTforAg, ICT4Djobs, ICT4Drinks, JadedAid, Kurante, OLPC News and a few other things. Opinions expressed here are his own and do not reflect the position of IntraHealth International or other ICTWorks sponsors.
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9 Comments to “Blockchain Use Case Failure: 43 Projects and Zero Impact Found”

  1. Cavin Mugarura says:

    So you will not name the 43 projects, but you will use the headline as click bait, how transparent is that process, how can we be sure it was not 15 or 24 projects that were evaluated. The benefits of a new technology don’t take form or shape within hours of the technology being introduced. While I agree with you there’s a lot of hype around block chain, there’s also a lot of hype about politics, and sport, it serves little to no purpose to dismiss this innovative ‘old’ technology. A Swiss startup was able to demonstrate how a company can be registered in less than 4 hours, versus 6 weeks. The ramifications for such business process re engineering go beyond cost savings. Most people who succeed in business don’t have an MBA, are you suggesting business schools close. Let’s not throw out the baby with the bath water.
    Block chain technology lowers costs, creates efficiencies and cuts red tape, I will share a paper, very soon how intuitive this ‘old’ tech is, and how it’s probably one of the premier inventions to come out in the last decade.

    • Wayan Vota says:

      Cavin, I can understand the “shoot the messenger” response when a grand idea has criticism, however, we should always take feedback objectively. If you want to do impact analysis yourself, here’s a long list of blockchain projects, that you can start with.

      • Cavin Mugarura says:

        There s a lot of hype, true, but not entirely for bad reasons. When we used to encourage organizations and businesses to use open source software, we would get egg thrown on the face, this scenario is no different. Let’s avoid throwing out the baby with its bath water. Many organizations are yet to fully embrace open data, lets not throw a hissy fit each time data requests are denied, I have been in this town long enough to know Rome wasn’t built in a day, in fact one of the greatest philosophers to ever walk on the face of this planet [Socrates] gave a stinging rebuke of Plato s invention of writing, dismissing it as something that will create forgetfulness and served no purpose in the learning process. If the great Socrates can get a few things wrong, what of we, mere mortals.

      • Cavin Mugarura says:

        On the upp side, i think the hype is good, it’s better than no hype, if you come to think of it. If Open Source Software had got the same hype 15 – 20 years ago, a lot of needles would have moved

  2. Matt Crum says:

    Good piece!

    If I had to make a guess, I think the greatest impact potential blockchain projects can make will be around censorship resistance and resilience and currency. This probably won’t come from bigger organizations directly. KYC (know-your-customer) and AML (anti-money laundering) regulations are major causes for not allowing technical services to the poor and vulnerable. This has artificially created barriers now for all those without proper identification, and for what? To add a few inconveniences to terrorist organizations, etc to move their money around? There’s a reason why most money from cartels, terrorist groups, etc, don’t use blockchain technology, and it’s because their systems working through the traditional laundering processes work just fine. The World Bank is estimating that remittances get more than three times the money to developing countries than aid does, and I’d guess a *lot more* would be going if it were easier from a regulatory side, and then blockchain would play in a role in terms of making these transactions interoperable, cheaper, and faster. Since almost everyone is having to work through this KYC and AML process, the price per transaction goes up dramatically.

    The other aspect where there seems to be great promise is the idea of being able to own your own data, which has also been given a lot of hype but not yet has come to fruition.

    When NGOs and governments look at blockchain, I don’t think they quite get the ethos: to balance the power. To do this, this *typically* means NGOs and/or governments will be actually having to give up some of their power and choice to give those who are in developing communities choice and power, and a bit of a conflict arises.

    I could be wrong, however. Maybe the biggest impacts will come by becoming or providing an alternative to the backbone of our current banking system to reduce fees and have faster transactions while keeping KYC and AML that many of the more successful projects are doing now (and props to those projects! I think they are definitely still providing value).

  3. John says:

    My name is John Burg and as one of the three authors of the MERL Tech blog about blockchain and learning agendas (link pasted at the bottom of this comment). I am greatly dismayed that our message has been drastically distorted across digital media. For example, this is not the original title of our blog.

    Our purpose was to share one of several approaches to mitigating knowledge gaps during the design phase of development efforts, specifically related to monitoring and evaluation, which was technology neutral. It just so happens that interest in blockchain among our peers pointed us to look at that particular technology. We did not debunk anything, nor was our goal to debunk anything. And, this blog is not affiliated to any organization, this simply recounted our experiences as we sought to learn more and share our learning, in our personal time.

    I would encourage everyone to go read the entire blog for themselves, including the string of comments where I have attempted to set the record straight on the purpose and message of the blog.

    Thank you,
    John

    http://merltech.org/blockchain-for-international-development-using-a-learning-agenda-to-address-knowledge-gaps/

  4. nick gogerty says:

    http://www.solarcoin.org is working as a reward. The impact from the project has been small, but is measurable. 12m SolarCoin have been distributed. In the coming weeks, SolarCoin will roll out to the world’s largest solar energy monitoring platform. We hope for meaningful impact in the next 2-3 years as our goal is to be in front of 20-35% of global solar energy. Our research thesis is here: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3281845

  5. Salome Stauble says:

    Dear Wayan,

    Shouldn’t the title be called: 43 Projects and Zero Impact Measured…? Could you prove your “no impact”-statement in the title, please? I can’t read any of it in your article.

    Lack of lessons shared…? That seems to be the problem of the non-profit sector with every innovation.
    In the ICT environment, it is business developers and sales that bring innovations through the birth canal, not statisticians or MERL professionals.
    Perhaps the problem lies more in the inexperience of the nonprofit-sector in dealing with innovation?

    best,
    Salome

    • Wayan Vota says:

      I believe the whole post proves the title. Multiple people (not just MERL practitioners) went looking for blockchain impact – any demonstrated impact – and found none.