Dr. Ibrahim Alhariri
No more lawyers! No more accountants! No more bankers! No more consultants! No more immigration officers! No more government officials!
These slogans might alarm many students and professionals in these fields, but they could evolve into phrases like “We don’t want immigration officers!” or “We don’t want accountants!” or “We don’t want intermediaries!”
What will governments look like five years from now? Could the endpoint be no government at all? As Roger Hamilton puts it: “In this new technological age, the best government might be no government at all.”
Can these seemingly grandiose slogans become a reality? The shocking answer is yes, and the way to achieve this is through Blockchain technology.
So, let’s introduce you to this new technology that will lead the world’s future and transform it:
**What is Blockchain? Or What is Transaction Internet?**
The term “Blockchain” refers to the process of creating consecutive blocks in the virtual Bitcoin currency that are mined in a sequential manner. Blockchain serves as a ledger where all financial transactions, assets, expenses, and similar items are recorded, similar to a general ledger in the financial sector.
Blockchain operates as an electronic record system for processing and recording transactions, allowing all parties to track accurate information over a secure network without requiring a third-party verification.
The Blockchain technology was invented in 2008 and is an encrypted informational program that functions as a unified transaction record on the network. Each group of transactions is linked in a chain, providing all participants with a comprehensive view of everything happening within the system.
The information program is designed to be decentralized, allowing transactions between users without needing the intervention of third parties like banks or globally used centralized trading systems.
Blockchain has become a primary driver of competition among global companies, alongside its counterparts like artificial intelligence, virtual and augmented reality, smartphones, the Internet of Things, and others.
**Centralized and Decentralized Technologies and Blockchain:**
Going back to the advent of the internet and the few years following that era, most web applications were based on the idea of a central data hub and a set of computers connected to it to retrieve information. For example, email was essentially a central data hub that users connected to check their inboxes, and the same applied to search engines or chat programs at the time.
However, in the last decade, the shape of internet applications changed with the emergence of what is known as Web 2.0. This term refers to fast applications that replace those installed on a computer, such as photo editing or document creation apps. With Web 2.0, there was no longer a need to install software on a computer; browsing sufficed for these tasks, thanks to the advancement in web technologies and languages, as well as the shift from centralized to decentralized storage.
Decentralized data storage means having multiple servers or databases working simultaneously to meet user requests as quickly as possible. This explains the increasing speed of internet applications. Instead of connecting to a server in America to read incoming emails in Hotmail, for instance, the system connects to the nearest geographically available server to present data at maximum speed. Nonetheless, the ownership of that data, servers, and technologies remains with a single company.
**Switzerland and the Crypto Valley!!!**
The Swiss government supports a local working group comprising experts, legal professionals, and government officials aimed at building a legislative and regulatory environment for startups working with Blockchain technology. This group includes the Minister of Finance and Economy, federal officials, and representatives from relevant companies.
The group is examining the legal guidelines surrounding Blockchain technology, as officials there believe that this technology has become increasingly significant not only for digital currencies but for many industries.
In practice, Switzerland has long been cooperative with Blockchain and cryptocurrency companies. There is a region known as the “Crypto Valley” which attracts a large number of Blockchain and cryptocurrency companies and is compared to the famous Silicon Valley in California.
Additionally, the Federal Council proposed more legislation in 2017 as Swiss banks began entering cryptocurrency markets. It’s worth noting that the “Crypto Valley” extends 30 kilometers from Zurich and hosts a significant number of entrepreneurial and emerging projects. Zug, a city in central Switzerland, was the first city worldwide to accept digital currency transactions, including Bitcoin, for government transactions.
**Blockchain as an Indicator of Happiness!!!**
In 2018, Dubai announced its plan to become “the first government to operate on clean energy worldwide and the happiest city on earth,” with a goal of transitioning 100% to Blockchain by 2020.
In October, Dubai launched the cryptocurrency service “emCash,” established the Global Blockchain Council with 46 members in partnership with Microsoft, IBM, and Cisco, to lead Dubai’s adoption of Blockchain technology.
**What are the Benefits and Features of Blockchain?**
The design of Blockchain makes it ideal for many transactions, distinguished by the following features:
1. **Security:**
Transactions are almost impossible to counterfeit. Each network participant verifies each block and must validate its accuracy, making any hacking attempt similar to trying to break into a door guarded by hundreds of guards.
2. **Transparency:**
Each block is visible to every member of the network, ensuring trust among parties and ensuring high credibility of transactions.
3. **Collaboration:**
Since Blockchain has no boundaries, it allows secure collaboration between parties involved in any type of transaction.
4. **Speed:**
Blockchain uses peer-to-peer technology without intermediaries, so capacity is related to only two parties and depends on their speed in processing transactions.
5. **Cost:**
Blockchain transactions are cost-effective as they don’t require armies of staff or complex transaction processing, stamps, fees, delays, or printing. Dubai estimates that by placing 100 million documents annually on Blockchain, it will save 25 million work hours and 1.5 billion dollars in taxes.
Due to these and other features, Blockchain has unlimited potential for future applications. Here are some examples of its future uses:
1. **Decision Making:**
Blockchain can be used in businesses and governments to increase transparency between parties, reduce corruption, and streamline bureaucracy. Transactions become clear, transparent, and open to public scrutiny, making everything from rental and ownership contracts to national elections fair and just.
2. **Healthcare:**
Blockchain has the potential to improve access to medical records by allowing secure sharing of patient records among healthcare providers. This enables doctors to aggregate all this information to improve their diagnoses and develop more comprehensive treatment plans for patients.
3. **Research Data:**
Research centers will benefit from collecting data from individuals, institutions, and governments to conduct studies and statistics to enhance societies. For instance, collecting patient data on Blockchain could help advance medical research, treat diseases, or provide insights into more effective treatments.
4. **Tracking Stolen Goods and Catching Thieves:**
Since all items and transactions will be tracked and monitored through unique identifiers and virtually linked to the network and Blockchain.
5. **Global Comprehensive Identity:**
Identity theft could become a thing of the past using Blockchain, with a global identity encompassing all your personal identification information – including passports, educational records, and driver’s licenses – securely stored on Blockchain. As your data is linked to unique biometric measures and is impossible to forge, it is secure from fraud.
6. **Electronic Transactions:**
Although important and the main driver behind the invention of this technology, we delayed discussing it to give space to other applications. Most of us are familiar with cryptocurrencies like Bitcoin, Ethereum, and others that have saturated the world and occupied people’s attention. Today, electronic transaction applications use Blockchain extensively in financial transfers and international financial markets, including Abu Dhabi’s financial market, which adopted it for its transactions in 2018.
These are just some examples – Blockchain will impact nearly every aspect of our lives, allowing service providers to collaborate with each other to offer you a unique, personalized service when needed.
**Challenges to Address:**
1. Transactions can be sent and received anonymously. This maintains user privacy but also allows illegal activity on the network.
2. More time is needed to combat older technologies and giant companies benefiting from them.
3. One of Blockchain’s applications, cryptocurrencies like Bitcoin, is highly volatile: there aren’t many Bitcoins available in the market, and demand changes rapidly. Bitcoin’s price is irregular, fluctuating based on major events or industry announcements.
As British Chancellor Philip Hammond said: “We may need to consider how to regulate this environment, where the required laws could emerge soon.”
Blockchain technology, which is fundamental to building digital currencies, was a topic of discussion at the 2018 World Economic Forum in Davos, Switzerland, and was included on the agenda of the G20 Summit in March 2018.
Finally, it is essential to remember that technology is still in its infancy. Its tools are developed daily to improve Blockchain security while providing a broader range of features, tools, and services. We strongly recommend that governments start using Blockchain due to its benefits for both governments and individuals.
