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There are many technologies involved in the fight against the new Coronavirus. Among these there is one that could emerge stronger and more mature: Blockchain
Apr 23, 2020
Artificial intelligence systems, robotics, 3D printing, virtual reality: there are many technologies used in the fight against the new Coronavirus. Among these, there is also Blockchain, which could find in this emergency a possibility to grow and the opportunity to expand on a large scale.
There are many sectors that could benefit from this innovation: from supply chain to the healthcare sector, from the insurance world to the public administration. Blockchain, in fact, allows traceability, transparency and validation of data, always respecting privacy.
In SDG Group, we have believed and invested in blockchain technologies for years, applying them to various contexts and different industries.
The merging of Blockchain with Analytics is also one of the Slow-Shift trends that we have identified as starting to surface in 2020. In our SDG INSIGHT PILLS we explain how Blockchain is empowering Data Security with transparency, confidence and quality-accuracy.
Blockchain: not only Bitcoins
Everyone has heard of cryptocurrencies and, in particular, the most famous, Bitcoin. Many, however, are unaware that these new digital currencies are based on a technology, blockchain, which could play an increasingly important role in different sectors. To curb the spread of this technology, therefore, there is a cultural problem: few people know it and even fewer are those who have understood how it works.
Let's try to clarify: blockchain is an electronic archive where various types of information are written. This database is not physically found anywhere, because it is shared between different nodes of the network, the blocks of the chain (from which the name block-chain derives), and for this reason it is said to be decentralized. Due to this structure, the register is immutable: it cannot be modified without the consent of the majority of the network and those who use it can send digital information, but not a copy of it.
It is a recent technology, born in 2008 from the initiative of a person or group of people known under the pseudonym of Satoshi Nakamoto, whose identity is still unknown. Nakamoto conceived blockchain as the system behind Bitcoin's functioning, but this technology today has its own life. It is finding application in many sectors, solving some problems such as scalability, privacy, transparency, and traceability.
The ongoing crisis has shown us how decentralizing and cutting out the red tape of some processes can be fundamental for the near future, in emergency contexts but not only.
However, which sectors could benefit most from this revolution? We talked about it with our experts Maurizio Sanarico and Stefano Bertocchi, Chief Data Scientist and Blockchain Advisor at SDG Group.
Supply chain: digitize distribution
One of the sectors that could benefit most from this technology is supply chain and a confirmation comes from the World Economic Forum, which recently stressed how a blockchain-based digitization can help supply chains in crisis contexts. The supply chain sector, in fact, is suffering a big impact from the production and distribution interruptions caused by this emergency, with huge damages for all the actors involved and consequences on the world economic system.
This is also due to some mechanisms inherent in the supply chain as it is today. Often, in fact, for privacy reasons and for market reasons, suppliers only know their direct interlocutors and not the whole process: in essence, a single interruption risks blowing up the whole chain and the problem is further aggravated when the goods have to transit from different countries. A system that is struggling to cope with shocks like the current one.
The emergence of the new Coronavirus has brought to light this and other limitations of the system, which blockchain could partially allow us to overcome. In particular, it could prove to be invaluable for guaranteeing the value chain in sectors that have particular needs: food & beverage, to verify the origin and freshness of the products, fashion, to certify the quality and to struggle counterfeiting and logistics, to streamline acceptance processes and customs procedures.
The role of Blockchain in the value chains
“In SDG we are very focused on the issue of tracking - Sanarico and Bertocchi explained - to combat counterfeiting, certify the origin, certify the information and protect the supply chain. At the basis of all these areas of applications there is always a single common thread: certification and data transparency ".
An element, which depending on the industry finds expression in different elements. "For the food and beverage sector - they continue - tracing allows us to protect the origin and freshness throughout the whole supply chain".
To do this, it is necessary to integrate this technology with sensor systems that allow us to identify and control all the steps. It is not simple but blockchain also allows you to easily trace errors. “It is essential that the source of the data is reliable, otherwise the risk is to record incorrect information in the blockchain. On the other hand, however, thanks to the immutability of the data, it is still easier to trace the counterfeiting and manage the measures".
A complete transparency, therefore, which offers numerous advantages for the supply chain but also hides pitfalls: “Thanks to blockchain, citizens could be much more informed about the products they buy and consume. This could prove to be a double-edged sword: companies will have to be able to manage these aspects also in terms of communication".
For tracking, SDG has introduced the use of microchips, considered more reliable than other systems such as, for example, the QR Code. "The codes most used today – the experts explain - are replicable while with microchips, which are an “active” and un-crackable technology, we are able to bind the product even more to its supply chain. In this way, the product to which the data is attributed cannot be replaced or modified: there is the certainty of its validity, with maximum transparency and, at the same time, confidentiality". Furthermore, in terms of logistics, the simplification of customs procedures for the free trade of goods should not be underestimated. "The use of the blockchain could easily track the origin of the product, confirm its nature compared to what was communicated by the carrier and easily block the spread of fakes that are increasingly difficult to identify by an untrained eye."
In fact, another sector that could benefit significantly from the large-scale introduction of this technology is fashion, where there is an open fight against counterfeiting and where the quality and protection of the brand are central aspects.
From healthcare to public administration: it's time for change
The ongoing emergency puts us in front of a limit that we had never experienced: that of social contact and personal relationship, on which practically all the actions we do are based on.
Blockchain, thanks to the possibility of sharing and validating data in a pseudo-anonymous form, also offers solutions from this point of view.
"Blockchain is agnostic and democratic – continue explaining Sanarico and Bertocchi -. It allows making anonymous a series of information, while certifying its validity and originality. This is particularly interesting at a health level, also in reference to new technological systems for remote diagnosis: managing information in this way allows you to protect the confidentiality of sensitive data and, at the same time, public and individual health. Furthermore, always in the healthcare context, an application of the blockchain in relation to insurance practices is interesting: it would offer access to services and funds, while ensuring the privacy patient. We are working on a new project that goes precisely in this direction".
The insurance aspects could therefore be managed through the so-called smart contracts, contractual forms registered on the blockchain that could be used to certify information also in other administrative contexts, leading to a de-bureaucratization of the services and allowing people to manage automatically some financial operations, such as those of micro-credit.
The emergency linked to the spread of Covid-19 highlighted some limits of the current models and underlined the need to digitize and to cut out the red tape in processes and practices. The technological tools are already at our disposal. Blockchain represents the answer to numerous problems: it could find in this crisis an important flywheel to relaunch itself. First, however, in addition to continuing to improve this solution on a technological level, we must overcome some cultural limits. An innovation becomes disruptive and capable of bringing real change only when it reaches a large number of users.
The rise of Blockchain has started.