Earlier this month, I attended the Open Data Institute’s annual summit. I heard stimulating speakers from business, government, the arts, start-ups and charities and left buzzing with enthusiasm, inspiration and ideas. This week I’m sharing a few of my thoughts in a series of posts.
My posts so far this week have focused on the benefits of opening datasets up to the public. But as I see it, that’s just the first stage in moving towards an open data economy. The next step is much more interesting – it’s to truly democratise data so that it has no clear owner at all.
That’s the idea at the heart of blockchain technology. For those of you who don’t know, blockchain enables the creation of ‘distributed ledgers’. This means that the details around a transaction are held collectively, rather than by a single party – so nobody has the monopoly on the truth of the transaction and nobody can manipulate it to their own ends. If cake analogies are your thing, this excellent video by The Memo sums it up nicely.
This idea has been gaining traction in the fintech sector – most notably with the rise of cryptocurrencies such as bitcoin, which – for better or worse – rely on the blockchain to work.
But the true potential of democratised data can go so much further than just cash. It can change the way society operates.
Let’s take supply chains as an example. Online shopping allows you to sort items according to numerous criteria such as size, price and colour. But rarely are ethical shoppers able to filter items according to factors like the treatment of workers or the distance goods have travelled.
Why? Because supply chain data is a closely guarded secret. In fact, according to ODI Summit speaker Jessi Baker of Provenance, it’s often so secret that supplier details remain unknown even to the company itself.
As I said yesterday, firms are reluctant to give this information up – and if it represents their competitive edge, who can blame them?
But blockchain brings the best of both worlds. By providing a layer of shared and secure data, companies can reveal the information necessary to provide transparency to their consumers without revealing their secrets to the competition. Suppliers can add data to the blockchain for manufacturers, retailers and customers to see – keeping a record whilst ensuring that truly sensitive information remains encrypted.
This way, every product can come with a full sustainability record in the same way that each bitcoin comes with a complete transaction history. All without incurring any business risk.
So there you have it. Yesterday we asked why businesses should open up their data and now we know how. Blockchain will not only transform transparency for consumers, but it opens opportunities for businesses to build communities, eliminate waste and really boost their reputations.