In blockchain we trust

 

In blockchain we trust

Published: Thu 24 Aug 2017, 9:00 PM

Last updated: Sun 27 May 2018, 7:59 PM

Next time you pass through a UAE airport, chances are your passport may not be stamped. Or if you need to renew your licence, you won't need to go to any government office. Better yet, there may not be any need to go to a bank to make an international money transfer. Why? Because the UAE government is aggressively adopting the blockchain technology to ease the lives of residents.
The government wants to offer secured, safe and transparent process to residents eliminating extra cost and time incurred by the government offices and residents themselves too. The transactions in these entities almost account for over 100 million documents each year and with introduction of Dubai's Blockchain Strategy all these activities will be transacted digitally and by 2020, it is estimated that 100 per cent of Dubai government transaction will be based on blockchain technology.
The Dubai Blockchain Strategy introduced last year, is built on three pillars, government efficiency, industry creation and international leadership. The strategy aims to bring in services where the international travellers will benefit from faster entry with pre-approved passport and security clearance and visas; easier mobility within the city due to approved driving licences and car rental; guaranteed wireless connectivity; enhanced tourism and pre-authenticated temporary digital wallets and payments. It is predicted that blockchain technology will contribute savings of up to 114 MTons of carbon dioxide emissions from trip reductions, and redistribute up to 25.1 million hours of economic productivity in saved document processing time.

So what is blockchain and how does it concern any resident of this nation? The simplest blockchain definition is that it a reliable record of who owns what, and who transacts what. But there's much more to it than that. Blockchain is based on distributed ledger technology, which records data (transactions, files, or information) across a peer-to-peer network. Every participant can see the data and verify (or reject) it using consensus algorithms. Approved data is entered into the ledger as a collection of "blocks", stored in a chronological "chain", and secured through cryptography.
"Blockchain's biggest security benefit is that is cuts out the middleman, where the parties can transact directly with each other without an intermediary third party. The transactions are transparent and immutable, and reduces costs. Faster transactions with banks and financial organisations will mean lower transaction costs for UAE residents," says Harish Chib, vice-president for the Middle East and Africa at Sophos. Blockchain technology would contribute savings of up to 114 MTons CO2 emissions from trip reductions, and redistribute up to 25.1 million hours of economic productivity in saved document processing time. So get ready, the sectors that might see these visible changes are health, vehicles, electricity, residency, mortgage, bill payments, business and many more to follow.
At the government level, The Dubai Blockchain Strategy is developed and executed in partnership with the Dubai Future Foundation. It may be recalled that Global Blockchain Council with was founded seven months ago by the Dubai Future Foundation includes 42 government entities and private companies to discuss the best applications in blockchain technologies. The strong government initiative throws open plethora of opportunities for private players regionally and globally and the gains are endless both for businesses and people in society.
Blockchain has become a real topic that is discussed around most boardroom tables. The discussion is not an IT discussion, but a digitisation and business model discussion. I am sure that we will see quick adoption of blockchain in the region with Smart Dubai setting the scene in its Blockchain roadmap, says Mechelle Buys Du Plessis, managing director for the Middle East at Dimension Data.
The UAE public sector is driving the country's blockchain market to deliver fast and secure customer and citizen transactions, said global blockchain enabler SAP. In contrast to business transactions with third parties like banks, blockchain sends records over a peer-to-peer network. With the inter-connected Internet of Things era advancing, UAE organisations are increasingly using blockchain to process loans, land titles, and intellectual property. There is strong interest in adopting Blockchain as a Service (BaaS), with private networks running on the cloud.
As a result, blockchain is taking off in the UAE, with the market set to reach $300 million by 2022, according to a recent report by Aseel Consultancy. Worldwide, 10 per cent of the global GDP will be stored in blockchain by 2027, according to a recent survey by the World Economic Forum.
"Blockchain is best way for UAE organisations to deliver fast transactions in a transparent and secure manner, while generating leaner, more efficient, and more profitable return on investment. The UAE government is already a global leader in blockchain, and is set to transform the supply chain," said Tayfun Topkoc, managing director for the UAE and Oman at SAP. Industry verticals set to be transformed by blockchain include logistics and supply chain to track and trace materials back to the source, public sector to provide official registries, utilities for energy sales between neighbors and utilities, and banking and financial services for cross-border transactions.
Mohammed Alsehli, CEO of ArabianChain Technology, said: "We've seen heavy adoption of this technology across the government sector. Reinforcing this trend, Dubai recently announced the Dubai Blockchain Strategy which is set to achieve a high degree of efficiency in government departments and aims for the government to become paperless. In addition, applying blockchain to banking services can also ensure faster and efficient transactions."
"Adopting blockchain as an enabler will not only allow for economic growth, but will reduce hours of time and tedious paperwork, whilst offering a platform that spirals digitisation forward. The opportunities are endless," concludes Du Plessis.
- sandhya@khaleejtimes.com

by

Sandhya D'Mello

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