The dizzying array of transactions and transfers of assets between companies and countries makes it a complicated process to follow transactions through the entire system.
You can Read For More Info to get an automated trading experience by accessing the best-in-class trading bots and trading strategies.
Several factors and applications rely on trust in these systems, including contract deliveries, payments, tracking and tracing products in the supply chain, intellectual property rights enforcement, etc.
Blockchain is a technology that provides a shared digital ledger where an immutable list of records that cannot be tampered with or altered by any individual participant exists on multiple computers at once—a distributed ledger—creating trustless environments for transaction processing between organizations without the need for intermediaries or centralized control such as clearing houses to verify transactions or hold collateral.
Blockchain is already being used in the financial industry in various applications—including money transfers, remittances, online payments, buying and selling stocks and shares, foreign currency exchange (FX), etc.
Finance is a natural fit for blockchain as there are clear benefits to using it for all of these activities.
However, a growing number of business applications beyond finance are also being developed using blockchain technologies. Let’s discuss how blockchain can be a big thing for future cities.
Essential prerequisites for a blockchain solution:
Blockchain solutions for city governance require a lot of data to be stored in the chain and verified simultaneously.
The active participants in the chain require an incentive to do so. For example, the list of members who have verified the transaction is available on the chain.
It is unnecessary to review the information by anyone—it is possible at any time.
The content of this information may be validated automatically or uploaded by manual input.
To improve trust, people will only accept digital documents as a form of transaction confirmation that nobody can change or modify without their permission from the chain.
Many checks and balances are also required to ensure that every member has completed their part before moving on to the next stage in the process.
The responsibility of each participant will be clear, so they can take the necessary precautions to complete the process.
With all of the above information, it should be possible to build a solution with a high level of trust in the ecosystem and its participants.
That is why blockchain technology is a good fit for use cases related to city governance.
Related: 5 Steps Involved in Blockchain Project Implementation (2022)
The benefits of applying blockchain technology to city management:
In addition to increasing transparency and trust, blockchain technology offers other benefits, such as streamlining processes and reducing costs for city management applications.
1. Streamlining the procurement process
As cities become more interconnected and cooperate, they must share information regularly regarding budget planning, project proposals, information exchange and decision-making by various departments.
In most cases, these discussions happen over email or through various internal systems, and the relevant documents are independently part of the chain.
Therefore, each member of the chain needs to be able to read all of these documents at any time and verify them.
The facts must be confirmed before any action can take place, and there must be no room for human error by anyone in the chain during processing.
How can blockchain resolve contractual failure?
It is possible today by using a shared digital ledger, thus avoiding documentation errors and delays in the process.
Collecting all the relevant facts can be stored and verified on a blockchain platform.
A smart contract is calculated automatically according to predefined rules when all the conditions have been met.
It is established automatically on the blockchain-based on previously agreed terms and record keeping, so manual intervention should not be needed.
2. Risk reduction
Many cities face several risks, such as natural disasters, terrorist attacks, etc., which are very difficult to predict before they happen.
Using blockchain technology for city management, it will be possible to identify potential threats and prevent or minimize their damage before they occur.
A key contributor to this is the idea of interconnection among all the city resources. The blockchain will allow cities to connect and share information in real-time.
This data sharing can track changes in citizen behavior, respond to disasters, and avoid them before they occur.
3. Digital identity of citizens
Many countries are concerned about their citizens’ digital identities and privacy while they use their digital devices at a rapid pace.
Some countries have already started issuing digital IDs for citizens so that it is easier for them to do business, access government services, vote, make purchases online etc., using these IDs instead of physical ones.
It makes it easier for police officials to track criminals and monitor personal information.
Citizens are not yet demanding a digital ID full-stop; however, by using blockchain technology and an online platform, they can quickly be issued one.
Furthermore, it allows law enforcement officials to access their digital identities without having to go through the trouble of writing down personal data, which users can share with anyone who requests it.
In addition, with a digital ID stored on a blockchain platform, people will regularly be able to update their identity information so that it is accurate at all times and authenticated in an immutable manner.
