Blockchain for the People: How Can Communities Benefit From The Tech?

Since Bitcoin’s launch in 2009, the blockchain has been explored across various markets and industries to solve long-standing challenges. By its design, this technology promotes transparency, traceability, decentralization, and universal accessibility with cryptographic security.

As a result, market players — from small startups and crypto unicorns to investment banking giants, artists, celebrities, and athletes — are actively leveraging the blockchain’s unique characteristics to disrupt finance, monetize digital art, fix global supply chains, and build the next iteration of the web.

But how does the blockchain benefit communities across the globe, what are its most promising applications for our society, and are there any potential drawbacks we should be aware of?

Leveraging Blockchain for Communal Benefit

Financial Inclusion

The financial industry is the first market conquered by the blockchain. And it shouldn’t come as a surprise, especially if we consider that its creator, Satoshi Nakamoto, described Bitcoin as a “peer-to-peer electronic cash system” in the original whitepaper.

Before BTC, ETH, and other blockchain-powered cryptocurrencies, the world’s population had to settle their everyday finances through centralized intermediaries like banks, brokers, and money transfer providers. In addition to taking an often hefty cut for providing these services, traditional finance firms have ultimate control over who, where, and how they serve their clients.

Consequently, while 11% of US adults are credit-invisible, 1.4 billion people representing nearly 18% of the world population, remain unbanked: a major issue for developing nations.

Blockchain tech not only solves the unbanked problem but also promotes financial inclusion: both by providing transparency and accessibility and being flexible enough to be tailored to different ideologies.

Unlike banks and other service providers in traditional finance, anyone can access DLT networks to store, trade, invest, transfer, or even borrow and earn interest on their digital assets through DeFi services without mediators. At the same time, we see the rise of community-targeted projects like Shariah-compliant financial products that aim to include the world’s Muslim population in the global financial system.

A Decentralized, Democratic, User-Centric Web

From the perspective of consumers, Web3 is another beneficial movement. While tech giants’ centralized platforms dominate the current Web 2.0 space, many startups are building the third iteration of the web to create a decentralized, democratic, and user-centric internet.

Solutions like peer-to-peer browsers, permissionless cloud storage platforms, blockchain-powered metaverses, decentralized identity solutions, and community-governed social networks take control from tech giants and give it back to the end user.

As a result, consumers get ownership over their data and enjoy enhanced security, universal access to essential web services, and more monetization opportunities.

Ethical Gaming

With the ethical concerns around gaming rising higher than ever, blockchain can be used to build IPs that promote ethical gaming instead of addictive models, legacy monetization strategies, and unfair usage of personal data.

For example, NFTs can provide players full ownership over their in-game assets, and the Play-to-Earn (P2E) model can offer them a way to earn tokens through active engagement.

At the same time, Proof-of-Stake (PoS) and other energy-efficient consensus mechanisms can help reduce the ecological impact of the applications, while dedicating a percentage of profits to charity donations is an excellent way to raise awareness and help tackle important social issues.

Charity Works

Regarding charities, blockchain offers an enhanced alternative to conventional solutions. Instead of the latter, communities – both on local and global levels – can create decentralized autonomous organizations (DAOs) to fund a good cause.

DAOs are governed by their communities in a decentralized manner, leverage smart contracts to operate autonomously, and use the blockchain for transparency and traceability. Consequently, anyone can view and audit all DAO donations to ensure they go to the right places and are used as intended.

Education and Science

According to UNESCO’s data, over 58 million children of primary school age don’t have access to basic education. And this is a field where yet again, the blockchain can offer tremendous value.

Through globally accessible learning platforms, local communities underserved in this field can join educational programs via a low-end device and a stable connection to the internet. At the same time, students are incentivized with crypto and NFT rewards to keep studying through models like Learn-to-Earn (L2E).

With Web3 and the blockchain, scientists can also tackle some of the most important challenges they face during their research. Through a new movement called decentralized science (DeSci), researchers can raise funds more easily for their projects, exercise ownership over their work, and earn fair revenue without generating censored or biased results.

Need for More Inclusion on the Local Level

Offering tremendous benefits for communities over the globe, blockchain technology has its own set of drawbacks.

The most obvious is that the industry and its underlying tech are still relatively new. Due to a lack of education in this field, we haven’t yet even come close to global adoption, with many myths and urban legends surrounding the market. Many existing solutions have major inefficiencies (e.g., Ethereum’s high gas fees) that could discourage many from joining the space.

Furthermore, while the target audience of most blockchain dApps is the global population, market players often fail to tailor their solutions to fit the needs and preferences of local communities. 

While I expect adoption to speed up in the next few years, the problems local communities face should be specifically addressed by industry participants.