Over the last decade, blockchain technology and cryptocurrencies have undergone a significant cycle of hype. As the Alternative Finance Lab (AltfFinLab) in the Innovation team at UNDP Europe and Central Asia, we were there to witness and learn more by experimenting ourselves. We are now convinced that we stand at a juncture where powerful technological solutions can also accelerate development endeavors. Read more about what we have learned and how we are planning to unlock the blockchain potential for development across UN(DP) through unrolling training programs and the use of blockchain-based solutions.
When we talk about using blockchain technologies and cryptocurrencies for development – it’s time we also move away from outdated associations with Bitcoins and speculative bubbles. Instead, we are referring to technology with the potential to ensure the legal identity of almost 1 billion people, offer financial inclusion solutions to 1.4 billion unbanked people, instil more trust in areas like agriculture through track-and-trace systems, accelerate financial aid through smart contracts and transparent payments, and create opportunities for tokenizing assets and impact investments.
This endeavor goes beyond mere technological adoption; it represents a shift in approach to development. We see blockchain as a pivotal tool for enhancing transparency, efficiency, and accountability. Our dedication to embedding blockchain in our projects is driven by its potential to expedite progress toward the Sustainable Development Goals (SDGs), thereby fostering more inclusive, effective, and resilient development models.
The narrative of UNDP AltFinLab’s involvement in blockchain is a rich tapestry, interwoven with various groundbreaking initiatives, each strand representing a step forward in our ongoing journey towards innovation and impact. In 2015, we started exploring blockchain and crypto opportunities together with other UNDP frontrunners, including at the Alternative Finance Conference we organized. Since then, we have facilitated the implementation of smaller-scale initiatives in over 10 countries worldwide, exploring best case practices for how to proceed forward.
2019 marked a milestone with our support for ‘The Other Bar’, an innovative project pairing chocolate bars with a ‘digital passport’ to trace the cocoa journey from bean to bar. More than just a product, each bar carried an impact token, offering consumers an opportunity to reinvest in the very farmers and communities who crafted their chocolate. Additionally, we have been involved in other projects on democratizing energy production and consumption in Serbia and Lebanon, enabling efficient, sustainable, and community-driven energy trading. What’s more, our collaboration with UNDP Lebanon led to the birth of CedarCoin in 2020, a digital impact coin designed to funnel investments into impactful projects within Lebanon.
In Bahrain, we undertook a unique initiative to create blockchain stamps (green energy certificates) for energy generated from solar panels. With the European Commission, we worked on a blockchain accelerator to implement several more solutions in the solar energy sector (in Serbia and Lebanon), as well as to track and trace agricultural products (fair supply chain for argan oil in Morocco).
Each of these initiatives represents a vital chapter in our blockchain legacy. Far from mere experiments, they were foundational steps towards grasping the immense potential of blockchain in tackling global challenges. They underscore our belief that blockchain is not just a tool for digital transactions but a catalyst for meaningful change, capable of addressing some of the most pressing issues faced by our communities today.
Our current chapter in blockchain is as thrilling as it is transformative. We have designed and initiated multiple blockchain initiatives for 2024. This endeavor aims to encourage innovation within UNDP, fostering a culture of exploring cutting-edge technologies and solutions. For this, we have established several strategic partnerships in the last few months with the Algorand Foundation, Cardano Foundation and Polygon Technologies. In addition, the UNDP AltFinLab team also onboarded six blockchain visionaries and experts from our global network to embark on a six-month mission to pioneer novel blockchain applications in development assistance.
Together with Algorand, we are developing our upcoming Algorand Blockchain Academy, a significant stride towards training UN staff on Web3 and blockchain technology. In collaboration with UNDP Digital Giving and building upon the UNDP Crowdfunding Academy training program, this initiative aims to equip UNDP employees, as well as staff from other UN agencies, with practical knowledge and applications of blockchain in the context of sustainable development. Set to roll out as a beta version in Q1 2024, the Algorand Blockchain Academy will also offer mentorship support to UNDP Country Offices (CO) initiating or developing blockchain development projects.
Furthermore, as part of our program, we plan to develop acceleration programs with funding for the most promising UNDP CO blockchain projects. This approach not only underlines UNDP’s commitment to utilizing blockchain technology for global challenges but also fosters a culture of continuous learning and innovation, opening new fundraising opportunities for pilots and experiments. Together with the UNDP Chief Digital Office and the UN Innovation Network, we are exploring ways to design and manage an effective and impactful UN Blockchain Community of Practice, as well as how we can create environments (playgrounds and sandboxes) to test and validate blockchain-based solutions in various UN development projects.
Our collaboration with the Cardano Foundation, announced in early November 2023 at their Annual Summit in Dubai, marks another significant milestone. Each year, through the Cardano Global Impact Challenge (GIC), the Cardano community focuses on blockchain-based solutions for development organisations, like the 2022 partnership with Switzerland’s UNHCR for a charity stake pool. This year’s GIC aims to revolutionise not only the Tadamon program, a multiyear initiative empowering civil society organizations, in partnership with the Islamic Development Bank and Islamic Solidarity Fund for Development, but also other UNDP development projects. Together with Cardano, we aim to establish an automated engine for a verified database and monitoring of civil society ecosystem development across multiple countries where AltFinLab operates. Finally, with Polygon Technologies, we are planning to jointly accelerate and incubate innovators working on the development issues using blockchain, and to learn from their experiences on working with startups.
In addition to our partnerships with blockchain foundations, we have also initiated a number of collaborations with private companies. One such transformative initiative is our partnership with Innofund, and several other UN agencies, on the Tadamon Web3.0 multi-platform. This platform aims to revolutionize grantmaking, crowdfunding, and matchmaking by integrating state-of-the-art Web3.0 technology. Focusing on aid distribution, systematic impact investment, cross-border money transfers, payments, and impact measurement, the platform is poised to significantly streamline and enhance the efficiency of these vital processes. This venture marks a major advancement in leveraging blockchain technology for more effective and transparent global development efforts.
Our journey with blockchain is just beginning. As we gaze into the future, a horizon brimming with exciting new initiatives and dynamic partnerships awaits us – from accelerators to incubators. Our efforts go beyond merely fostering new ideas; we are actively shaping a new paradigm. The upcoming e-learning training for UN(DP) employees is set to spark a global discourse on blockchain’s role in sustainable development. Additionally, our 2024 blockchain partnership event, to be hosted in the Western Balkans, is poised to be a hub of innovative ideas and collaborative efforts.
As we move towards this new phase of testing and experimenting with blockchain at UNDP, our commitment to unlocking its full potential remains unwavering. But to do this, collaboration should be at the heart of this endeavor. Thus, this is also an open invitation to technologists, development professionals, innovators, and dreamers: join us in spearheading this digital revolution. Your ideas, active participation, and engagement are the lifeblood of our mission. Together, let’s build a future that is inclusive and resilient, driven by blockchain technology, where every innovation and effort propel us towards a universally prosperous world.
Stay tuned for updates, insights, and inspiring stories from the forefront of blockchain and development.
(Edited by Svetla Baeva, Communications Lead, UNDP IRH)
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