From Transparency to Transformation: Blockchain and its Potential for Business Sustainability
TEAM International
Global IT consulting company, focused on transforming businesses outcomes, through agile and innovative IT solutions
Recent news concerning the environmental impact of blockchain technology has drawn focus to the energy-intensive nature of some of its core processes. Consequently, a debate on blockchain's sustainability is now ongoing. Can the world really afford the energy expenditures needed to prop up the growth and proliferation of massive blockchain systems like those used for Bitcoin??
Blockchain-dependent industries will need to answer the sustainability question if they’re to thrive into the future—a fact they very well understand. Take the cryptocurrency Ethereum (ETH), for instance. In response to these concerns, it has now implemented a major overhaul of its consensus algorithm and has thus massively improved the system’s energy efficiency.?
While such changes are commendable steps forward, the discourse surrounding blockchain’s environmental impact also needs some work. The energy concern is undoubtedly valid but shouldn’t overshadow the technology’s positive aspects. Indeed, blockchain applications have considerable potential to enhance business sustainability in various ways.?
Our article will explore how blockchain can contribute to sustainable solutions across different industries to bring some balance to the conversation. Join us as we delve into the future of blockchain tech and its role in creating a more sustainable world!?
Greening the future: How blockchain enables sustainable supply chains?
Blockchain’s core feature is its ability to create a shared, decentralized ledger that’s immutable and transparent to all participants. When applied to supply chain management, this revolutionary information environment enables unprecedented levels of information sharing and cooperation between market actors.?
This trust-based system opens up numerous possibilities for enhancing supply chain sustainability. Consider, for example, a consortium of coffee brands partnering with various producers to create a shared blockchain that would record the journey of their coffee beans, from sustainable harvesting practices to steaming hot cups. Such a practice would benefit everybody!?
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Crucially, such a blockchain-based solution isn’t limited to the coffee industry, as the fundamental challenge of supply chain information sharing is universal across sectors. As such, similar sustainability solutions could be applied to a wide range of industries, including diamond mining, agriculture, and livestock management. Blockchain tech now provides all these sectors with an effective tool to coordinate and verify eco-conscious operations.?
Sustainable energy management on the blockchain?
With the democratization of renewable tech like solar panels and small-scale wind turbines, we might soon witness the mass use of blockchain-powered, peer-to-peer energy commercialization. Sounds crazy, right? Well, it’s not, as pilot programs have already proven the core concept is feasible.?
Here’s how it would work:?
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This system would create a more resilient, efficient, and sustainable local energy ecosystem. It'd reduce transmission losses, lower costs, and accelerate the transition to renewable energy. As these blockchain networks scale up, they have the potential to fundamentally transform our energy infrastructure, moving us towards a decentralized, democratized power system.?
Blockchain-verified carbon credits?
Carbon credits have a problem. In theory, they’re an excellent way for companies to offset their carbon production, but in practice, the industry is plagued with cheating, workarounds, and a general lack of transparency.??
Organizations thar do their due diligence often find that the carbon credits of mass-market corporations are, at best, unverifiable and, at worst, complete junk. What’s worse, these findings make people lose faith in the system. Are we just supposed to take these billion companies at their word??
Enter blockchain. As we’ve already seen, blockchain systems enable information repositories where trust is no longer a factor since every party can verify their own tamper-proof version of the ledger. As such, it’s easy to see how transitioning carbon credits to a blockchain layer could eliminate all the industry’s current problems regarding transparency, observability, and verification.?
However, the possible benefits extend even further. With a blockchain system, specific rules could be established regarding the calculation of carbon credits and how these match up with different sustainability solutions. How many carbon credits would planting 1,000 trees produce? How about a transition towards more energy-efficient operations? With such a multitude of solutions and ways of assessing them, calculating carbon credits can get chaotic and leave room for trickery and deception. Blockchain ledgers, however, could institute the same rules for everyone and ensure a level playing field.?
Final thoughts?
Those passionate about environmental issues know very well that deception and coordination are huge problems. Many claim to do much while doing nothing, and many who would do something don’t because they don’t want to feel cheated. Once we realize this, we can immediately intuit how game-changing blockchain’s core innovation truly is.?
The arrival of blockchain means we no longer have to trust. When it comes to saving our environment, we now get to verify!?