Dossiers are quick and easily digestible recaps of what a company or project is all about – how it came to be, the people involved, and some of our thoughts on it.
Building Blocks is probably the best known application of blockchain in a humanitarian context, using blockchain as infrastructure for cash-based assistance in a number of refugee camps across Jordan.
Started by Houman Haddad (then Finance Officer at WFP) and Alexandra Alden (then Innovation Consultant at WFP) in 2016. Developed by Datarella, it uses Parity Technologies’ Ethereum client, modified to use a Proof of Authority consensus algorithm.
The most significant people and entities involved in Building Blocks are:
As part of its Building Blocks pilot, WFP is trialling blockchain as a means of making cash transfers more efficient, transparent and secure. Cash assistance and emerging digital opportunities empowers [sic] vulnerable households to meet their essential needs according to their priorities. (source)
How it works
Users buy goods in designated stores, depending on their assigned entitlements. For the end-user, the process is remarkably simple: they shop normally in one of the designated stores, and during checkout they pay through an iris scan. This iris scan identifies the customer, whose balance is confirmed to be sufficient, and if so the payment goes through (source). Stores then receive their payments on a monthly basis by WFP.
Infrastructure-wise (blockchain jargon ahead!), the pilot operated through four Proof of Authority nodes that run a private fork of Ethereum, all managed by WFP. A collaboration with UN Women in Jordan has changed this, however, as UN Women now manages an unknown number of nodes.
- Initially funded by the WFP Innovation Accelerator, a proof of concept was conducted in January 2017 in Pakistan. It used a public blockchain (Ethereum) (source, source)
- The PoC developed into a pilot in Jordan, ended in May 2017, which served 10,000 people. The scale-up phase is currently undergoing, also in Jordan. “As of October 2018, more than 100,000 people residing in camps redeem their WFP-provided assistance through the blockchain-based system.” (source)
- A new partnership with UN Women is starting “[…] to help Syrian refugee women at the Za’atari and Azraq refugee camps in Jordan. The women, who are participants in UN Women’s Cash for Work Programme, will be able to request cash back at the supermarket or make their purchases directly. UN Women and WFP validate each other’s transaction through the common use of Building Blocks, which reduces fragmentation in humanitarian assistance.” (source)
- The next phase of the project aims to scale from the current number of beneficiaries to all 500,000 Syrian refugees in Jordan currently supported by WFP (source)
- Possible future developments include “using the application of blockchain technology in areas such as supply chain operations and digital identity management.” (source)
- The iris scanners were not installed by WFP – they were already available on-site as Building Blocks superseded an earlier voucher-based program by UNHCR (not blockchain related).
Our thoughts about Building Blocks
As one of the few humanitarian-led projects, current outcomes paint a nice picture for the future use of blockchain-based systems in cash programming. The reduction in fees has and potentially will save organizations a considerable amount of money, among forcing a renewed interest in topics such as users privacy, management and ownership of their data.
What Building Blocks is not, however, is a fully realized vision of using blockchain in humanitarian action and development – that will come with time, as more organizations are onboarded and start running their own nodes, and the capabilities of the system are expanded. WFP’s future plans in this regard are quite ambitious, but unfortunately ring of oft-repeated blockchain use case ideas – their feasibility remains to be seen if and when they are implemented.
That being said, Building Blocks is among the best current expressions of blockchain-based systems in a humanitarian context, and we look forward with interest to all its developments.
For a more in-depth exam on Building Blocks using our analytical framework, click here.
- Building Blocks | WFP Innovation (page's source code) This text is only available in the HTML's description
- Blockchain for Humanitarian Assistance
- Building Blocks | WFP Innovation
- Look Who Is Riding the Blockchain Hype Train Comment by Haddad