The technology that fueled the global cryptocurrency frenzy may soon save you from getting sick because of tainted meat — but only if policymakers pave the way for it to happen.
While many Americans have probably heard the term blockchain, they still may not understand what it is and how it works. Long associated with cryptocurrencies such as Bitcoin, some mainstream companies throughout the manufacturing, retail and other consumer industries are exploring models for how this technology can be used to improve everything from logistical efficiency to food safety, which can have enormous real-world benefits for all Americans.
But realizing these benefits will require more than just businesses investing in blockchain. It will also require policymakers to understand the enormous potential of this complex technology beyond cryptocurrencies and how it can serve consumers and the entire American economy. This is what sparked the birth of the Congressional Blockchain Caucus last year in the House of Representative — led by Rep. David Schweikert, R-Arizona, and Rep. Jared Polis, D-Colorado — which serves as a blockchain educational resource for policymakers and staff on the Hill.
The concern among Schweikert, Polis and other blockchain advocates is that increasing calls to regulate blockchain will focus solely on the technology as a cryptocurrency driver rather than a tool that can serve businesses, governments and consumers. A better grasp on blockchain’s potential is essential for ensuring smart policies that can promote investment in its use — or, as Schweikert has noted, to prevent government from “screwing it up.”
While some policymakers may be slow to recognize blockchain’s potential, businesses are increasingly exploring how to incorporate it into their operations in ways that can ultimately benefit consumers.
As Bloomberg recently reported, Walmart is looking at how it can use blockchain to track food products to ensure their safety. And preventing tainted meat from reaching customers not only will keep people from getting sick, it could also have widespread ripple effects throughout the economy. Walmart notes that just a 1 percent reduction in food-borne illnesses would increase economic productivity by $700 million through workers taking fewer sick days.
Meanwhile, manufacturers are turning to blockchain as a way to increase efficiency and cut costs throughout supply chains — savings that, in turn, could be passed on to consumers. Samsung, for instance, envisions a 20 percent cut in shipping costs thanks to a blockchain systems for tracking global shipments.
Blockchain also has potential implications beyond the private sector, as state and federal government agencies are exploring how they can leverage the technology’s applications to make essential public services such as data record keeping more efficient and secure. In fact, the National Association of State Chief Information Officers last year called blockchain one of the “next big, transformational technologies” for governments.
And some states are taking steps to ensure they are prepared to embrace blockchain. In 2016, Delaware launched the Delaware Blockchain Initiative, with the goal of creating a regulatory environment that enables blockchain technology development and to attract blockchain companies to the state. Last year, Illinois launched a similar program to explore blockchain applications for public and private services, and as Brookings noted in April, numerous other states are starting to shift attention to blockchain’s potential.
These are important steps toward decoupling blockchain technology with the often-negative headlines associated with cryptocurrencies and avoiding policies that could have unintended consequences for other blockchain uses. The more policymakers understand that blockchain is not simply Bitcoin, the more benefits all Americans could soon see as the public and private sectors innovate to unleash its potential.