2016 is the still a year of early adoption for Blockchain, a distributed ledger of transactions, with the World Economic Forum projecting that by 2027, 10% of the world’s GDP will be stored on blockchain. In the US, reporting firm Greenwich Associates predicts the US financial and technology markets will invest $1 billion in blockchain technology in 2016. The venture capital industry is also getting onboard with a sharp increase in investment from USD$3 million in 2011 to $474 million in 2015.
In Australia, major financial institutions such as the Big 4 banks are launching a range of initiatives such as Hackathons to further pioneer blockchain for use in contexts such as financial settlements and corporate bonds. The ASX has also thrown its support behind the technology with its $15 million stake in US-based development firm Digital Asset Holdings, LLC. earlier this year.
While its applications at present predominantly concern financial services, blockchain has a multitude of uses within the property industry, healthcare industry and agricultural space to name but a few.
Property and Tenancy Agreements
Smart contracts, a common use of blockchain, can be adapted for use in drafting legal documents specifically for property, namely tenancy agreements.
This use has been achieved by UK firm Midasium, the “blockchain of real estate”, with smart contracts allowing transparent disbursement of funds and automatic reconciliation to a bank. It also allows automatic payments to landlords, contractors, councils and property managers, using rent or bonds as a source.
Blockchain technology also has the potential to record beneficial ownership of property held via trust arrangements through a register, an idea proposed at a recent Westpac hackathon.
Among the most prominent pioneers of blockchain in Agriculture is Australian fintech Full Profile. The startup aims to commercialise blockchain technology through real-time payment on title transfer/physical delivery of grain, shared ledger solution prototype and a system that allows growers to be simultaneously paid at delivery along with all other claimants on the proceeds of sale
The company research is also concentrating on how blockchain may address longstanding issues in the agricultural industry such as high risk of credit defaulting, reconciling stock inventories and source traceability throughout the supply chain.
Current discussions around the use of blockchain in Health have mainly concerned overcoming difficulties in medical record interoperability and the significant gains in data protection that could be advanced through its adoption.
A notable example of the vulnerability of medical databases was the Anthem Breach of February 2015, whereby the records of over 78.8 million were compromised.
A blockchain can help prevent this with multi-signatures and cryptography. Data is hashed onto the blockchain and with multiple signatures required, access can only be granted conditional on approval from the necessary number of people. Hence, there could be an authorisation requirement that for patient records to be accessed, the relevant medical professionals and patients have to all give their approval
A leader in the US space is Gem Health, a provider of enterprise blockchain solutions which recently launched a network for developing applications and shared infrastructure for healthcare powered by the Ethereum blockchain. This network is anticipated to improve efficiencies in data exchange through data storage, smart contracts and identity schemes.
Key Takeaways for Blockchain Use
Blockchain has the capacity to be used in a broad range of activities, virtually unlimited wherever there is verifiable data or digital assets. What’s more, there already exist several pre-made platforms for SME’s to utilise such as the Ethereum Project and Openchain open source software. If you have any questions about the use of blockchain, get in touch with our IT lawyers.