A Critical Look at the Blockchain Revolution and Its Socio-Economic Impact

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Stepping away from blockchain’s economic impact, its impact on society as a whole is just as influential. Firstly, the creation of digital identities not only affords individuals financial inclusion but also political and social opportunities such as the right to vote. Moreover, these identities enable us to prevent human trafficking, forced labor and child labor (Lapointe & Fishbane, 2018). Blockchain has also been used to store land registry information to allow individuals to prove their land ownership, preventing fraud and manipulation by third parties (Abbatemarco, De Rossi & Salviotti, 2018). Moreover, blockchain has been instrumental in protecting public health records and other sensitive information, enabling patients to have greater control of where and how their information is distributed. This lowers barriers to medical testing that is usually stigmatized, such as HIV testing (Walid & Selder, 2017). Blockchain has also been used as a tool for democracy in increasingly authoritarian regimes by creating immutable records that can’t be altered, censored or removed. This makes it easier to hold governments accountable for human rights violations (Walid & Selder, 2017). Moreover, blockchain has enabled secure voting systems where voters can vote in a secure, transparent and fair way; certain that their vote has not been subject to government manipulation, hacking or corruption. This reduced the barriers to voting, increased voter confidence and reduced voter suppression (Kshetri & Voas, 2018). Next, blockchain allows for supply chain management and asset tracking, enabling consumers and executives to distinguish if an item was a product of conflict as well as prevent pharmaceutical fraud (Walid & Selder, 2017). This traceability enables governments and non-governmental organizations to track financial resources, such as humanitarian funds, more transparently and efficiently (Lapointe & Fishbane, 2018). Thus, blockchain technology has significant social benefits as it allows for the liberation of many people by giving them control over their information, privacy, and identity.

Up until now, I have only mentioned the positive socio-economic impact of the blockchain revolution. However, our present times are nothing like the benefits I have described. The wealth gap is only increasing, our socioeconomic situation worsening. Government surveillance is at an all-time high. It is time I explain the importance of design in blockchain systems. All features that can be a part of a blockchain system are only potential attributes as the particular design of the blockchain system will determine which attributes it embodies and the ethical implications this will have (Lapointe & Fishbane, 2018). Thus, a blockchain system does not necessarily need to be decentralized, open or anonymous. It can be a private permissioned blockchain operating on a centralized network. A private permissioned blockchain is one where users have to have certain credentials to operate on that blockchain. Thus, users are not anonymous (Yeoh, 2017). Many corporations and governments prefer permissioned blockchains as they are much easier to regulate and control. Members can change the rules of the blockchain as they wish. There is little risk of a 51% attack as nodes are trusted. Costs are lower as transactions only need to validated by members (Tapscott & Tapscott, 2016). However, there must be a central authority who has control over who can write and validate transactions on the blockchain and under what conditions. Rules can be changed to suit the agenda and some members can have more privileges and rights than others (Tapscott & Tapscott, 2016).

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Hence, access to the blockchain and rights provided are unequal and subject to discretion by a central authority. This is completely contrary to the initial purpose of blockchain technology. The concern when blockchain technologies first emerged was that governments and corporations would pick and choose the elements of blockchain that they liked and design and implement the technology to their advantage. This is exactly what has occurred.

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A Critical Look at the Blockchain Revolution and Its Socio-Economic Impact. (2022, August 25). Edubirdie. Retrieved July 15, 2024, from https://edubirdie.com/examples/a-critical-look-at-the-blockchain-revolution-and-its-socio-economic-impact/
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