With time, cryptocurrencies have made their presence felt in many major sectors of the economy. A large number of industries from various fields like hospitality and medicine have realized the usefulness of cryptocurrencies. With these developments taking place, the popularity of cryptocurrencies has only been increasing.
Bitcoin, the largest cryptocurrency in the market, has made a grand and meaningful entry in many spheres of the global economy. Many industries use bitcoin and blockchain, the technology on which it works, to achieve multifaceted development and progress. Bitcoin and blockchain have received so much recognition that many experts contend that they can help revolutionize the way most industries work.
It becomes crucial to investigate the contribution that a digital currency and its technology can make to sustainable growth and development when it gains such prominence. Living in an era where human activities like pollution have been threatening the balance of the ecosystem, sustainable development has inevitably become a topic we must consider. As such, examining the potential role of blockchain in achieving sustainable growth becomes inevitable.
Why is blockchain essential for sustainable development?
When experts first conceived the ideas of sustainable growth and development in 2012, blockchain was yet to boom. In its early stages, the potential of blockchain was hard to foresee. At present, however, blockchain has numerous opportunities to reform the conventional approaches to the concept of sustainable development and growth. If deployed correctly and used responsibly, blockchain can indeed be a game-changer for SDG plans. Some ways in which blockchain can influence sustainable development programs are:
Decentralization
Bitcoin is a digital currency that is thoroughly decentralized. That means no authority or institution gets to regulate it or exercise any control over platforms like that hold bitcoin transactions. This decentralization can take the world towards sustainable and distributed economic development. The present economic scenario, especially post-pandemic, has been one of economic disbalance and polarisation. Certain countries have been suffering from extensive financial crises. Bitcoin can help these countries get back on their feet by allowing easy access to capital and economic facilities like loans and subsidies.
Multilateralism
Bitcoin calls for the establishment of genuinely multilateral world order. Since it does not have a centralized regulating agency, it requires the different countries of the world to work to regulate it unitedly. To control heinous crimes like human trafficking, money laundering, and drug peddling that use bitcoin, developed and underdeveloped countries have to function together.
Raising Funds
Many organizations, including the American Red Cross and the Human Rights Foundation, have been accepting donations in cryptocurrencies for quite some time now. Many players in the international arena now look towards digital currencies to fund the SDGs worldwide. The crypto fund by UNICEF, which has been investing in cryptocurrencies to generate revenue, is a shining example of such an organization.
Building up of transparent supply chains
The COVID 19 pandemic has pointed out several drawbacks in the global supply chains. A core aspect of global trade and delivery systems, supply chains are essential for sustainable development. Blockchain can help us build up a resilient and transparent supply chain network that would be immune to disruptions.
Creation of accountable public institutions
A principal threat to sustainable development in many countries is corruption. Procuring goods and services to facilitate development forms one of the most significant expenditures of governments worldwide. Unfortunately, that is also the biggest source of corruption. Using blockchain to store data on government purchases and expenditures can help create a more accountable system of public service institutions. That is because blockchain stores data in public ledgers, making it impossible to tamper with the information once stored.
Conclusion
Apart from this, countries can also utilize blockchain for generating responsible sourcing and consumption. Consumers across the world could then become more aware of what they are consuming, enabling them to take more responsibility for their role in sustainable development. Overall, blockchain can indeed recast the concept of sustainable development and growth in the future.