Blockchain. You’ve undoubtedly heard about it, but do you understand it? If you do, congratulations, if not, don’t worry, you are far from alone. In a political landscape dominated by Brexit – triggered by a majority of 4 per cent – it’s refreshing to find that the nation can agree on something; with 92 per cent of the population admitting they don’t understand this new technology. In fact, a recent survey revealed that 36 per cent of Brits actually think the term ‘cryptocurrency’ relates to funeral finance, and 41 per cent believe a ‘blockchain’ to be an old-fashioned toilet pull flush! But, with Wikipedia defining the process as a “Merkle tree of blocks that contain a cryptographic hash”, and most other ‘simple’ explanations running into the thousands of words, these stats are hardly surprising.
When you strip everything back, people are excited about blockchain because it is, potentially, a better way to keep records – essentially enabling a communal record book. This is because, instead of just existing in one place, it exists simultaneously on everyone’s computer; meaning it cannot be changed in secret, each transaction is verified multiple times and every organisation or individual does not have to spend time and money keeping their own records. For example, instead of two banks both individually recording a transaction between their customers, it can now be updated once on a blockchain ledger where multiple parties can verify it. Notably, these databases can be housed on either private or public networks, allowing these benefits to be enjoyed privately or transparently.
And, well, that’s basically it. Without delving into the technical nuances this is, essentially, why there is so much excitement surrounding the technology. If businesses can accurately and cheaply track their supply chain this way, they could cut costs while allowing customers to track exactly where each bean in their coffee cup – or diamond on their wrist – came from. And, paying for these products would also be cheaper, with such a simple system cutting the costs of financial transactions – significantly increasing the efficiency of the world economy when multiplied out over the billions of transactions that occur every single day.
Yet, despite its enormous and far reaching potential, it is not just the public who don’t understand the basics. Politicians, civil servants and other policy professionals also appear to be burying their heads in the sand, with a wide-spread lack of comprehension and enthusiasm from policy makers seemingly dampening progress. Analysis by the American research group Brookings found that 16 of the 50 US states had either not legislated at all in relation to Bitcoin, or only done so to restrict its use. More illuminating still, only 4 per cent of state-level policy makers were deemed to have recognised the ‘innovation potential of blockchain technology’. On the other side of the pond the situation isn’t much better, with the UK’s ‘All-Party Parliamentary Group on Blockchain’ suffering from a less than inspiring start after co-founder, MP Grant Shapps, was forced to resign when his personal stake in a Bitcoin start-up was revealed. This has helped fuel the misguided belief that blockchain is solely the mechanism behind Ponzi-esc cryptocurrencies, a view recently shared at a select committee debate in Parliament.
This is where the need for strategic communications is the clearest. The complex nature of the technology, its rapid development and the narrow focus of modern Western politics has led to an enormous gap between the technology’s potential, and its political exposure. Without vested organisations and companies actively taking steps to reduce the political and public knowledge gap, explain its benefits and ensure it gets its fair share of voice, apathy is likely to be blockchain’s most restrictive barrier.
Consequentially, while blockchain could likely play a crucial role in the future of financial institutions, healthcare providers, supply chains and democracies, that role is still unclear. Who will adopt it, at what pace and whom will benefit the most are still unclear, and education combined with evangelism – especially efforts that target those with control over the legislative environment – are likely to be key as blockchain’s place in society takes shape. Ironically, unlike the democratic principles upon which the technology was developed, the importance of legislation in this area suggests that its future will be determined by the few not the many. And, it is those who are actively engaging this small but potent audience that look set to flourish.
If you’d like to talk to Portland about putting blockchain, specifically your perspective on blockchain, on the policy map, email: [email protected].