Beyond Borders - Unveiling Potential of Blockchain in a Crisis

Crisis as Catalyst for Unprecedented Change

For over a decade working in the international aid and development sector, I've grappled with some troubling questions: Are our traditional systems really equipped to respond to large-scale humanitarian crises? Are the powerful and wealthy institutions committed to protecting the world's most vulnerable humans really doing all they can? Can we do better? How?

Through my Fellowship at the Ethereum Foundation, I've conducted research and seen firsthand that public blockchain protocols like Ethereum are more than a neat innovation – For people caught in humanitarian crises - from Syria to Myanmar, Lebanon, and beyond - where conflicts and crises erode trust in fundamental technologies and where authoritarian regimes and centralized power structures have shaken collective trust in institutions, emerging technologies can be a lifeline in times of unimaginable human suffering, and they represent a glimpse into a future model of crisis response unencumbered by borders and institutional inertia.

When Each Detour Costs Lives and Trust

Picture the colossal amount of wealth that is $31.3 billion US dollars. That is the total amount of international humanitarian aid allocated in 2021. Of that staggering sum, only 1.2% is sent to local NGOs in the form of direct aid. The rest moves through a chain of subcontractors, global funds, and multilateral institutions that spend large sums on operational costs. Millions of dollars that are supposed to secure food or medical supplies for those in need end up earmarked for items like pristine white Toyota Land Cruisers, business-class trips to Geneva, or costly office spaces in the nearest stable city center. Millions more are lost to corruption, waste, and mismanagement. This imbalance exposes a harsh reality: resources meant to serve as a lifeline for those in pain are often whittled away by the same structures created to help them.

The Crisis as Unforgiving Classroom

The 7.8 magnitude earthquake on February 6, 2023, taught us a brutal lesson in disparity between Syria and Türkiye disaster response. In Syria, over 4.5 million people, already scarred by displacement and conflict, were faced with a new catastrophe. As buildings crumbled, claiming over 8,476 lives, the need for aid was dire and immediate.

Turkish NGOs responded swiftly, leveraging existing avenues of blockchain-based donation pipelines to raise over 11 million USD within just 48 hours. Their innovative use of cryptocurrency, NFT sales, and platforms like Endaoment and The Giving Block not only showed their digital literacy, but also highlighted the vast gap in resources and technology between the two nations. Turkish government initiatives and campaigns like “Turkey - United Heart” further demonstrated their efficient mobilization, raising a staggering 115.1 billion Turkish Liras (equivalent to $6.22 billion USD) in one night.

From Skepticism to Adoption: A Turning Tide

In our pre-crisis survey, only 51 of 94 organizations had considered blockchains as a viable alternative to entrenched systems. Post-crisis, 87 of the same NGOs responded positively, and many had already started incorporating the technology into their work and operations. With the luxury of choice and time stripped away, those on the ground didn't just adapt; they transformed. Whom had once been skeptical were now embracing digital currency as their go-to solution for remittances and donations.

Re-humanizing Impact

If this story tells us anything, it's that the theoretical debates around new channels of aid are over. We are now in the realm of the practical, the tangible, and the desperately urgent. Peer-to-peer aid is not just about raising money; it's about re-engineering trust in a world marred by crises. We can narrow the distance between giver and receiver, fostering a sense of proximity even from continents away. In this new paradigm, aid becomes a personal gesture rather than a faceless transaction, transforming the giver-receiver dynamic into one of solidarity.

The Future of Crisis Response

As global crises lay bare the frailties of our traditional systems - systems that falter and fragment under duress - blockchains may be able to offer a more resilient alternative – one that treats all participants fairly, regardless of their socio-political context. In this future, humanitarian aid is not just a transaction, but a connection between people, a bridge between cultures, and a lifeline in times of need.

Karam Alhamad is a second-year MPP student at Jackson School for Global Affairs at Yale University with 12 years of experience in international development, specializing in research and grants management, focusing on Middle Eastern dynamics. His current work explores blockchain technology's potential in humanitarian aid. His research report will be published later this year.

Source: https://blog.ethereum.org/en/2023/11/15/beyond-borders-nb