Blockchain Applications for Smart Cities
The growth of population and urbanization trigger multiple problems such as resource scarcity, pollution and power shortage. Although the development of cities is associated with progress, urbanization-related problems are non-negligible. An article published in Bloomberg CityLab argues that another 2.5 billion individuals are projected to migrate to cities by 2050 (Poon, 2017). Yet, the challenges that urbanization causes might be solved through the use of new advanced technologies such as blockchain. This article will elaborate on how blockchain city applications can overcome challenges caused by urbanization by looking at the existing examples.
There is no denying that cities play a crucial role when it comes to long-term trends and adaptation. According to Corfield, author of The Oxford Handbook of Cities in World History, the ultimate benefit of continuous adaptation is to ease the harshness of big changes. Therefore, cities tend to follow trends and implement policies considering the possible difficulties. In addition to this, they can be seen as local pioneers in a digitalized global world. By the same token, blockchain technology is one of the long-term trends that requires collective work and smart decision making. Early adopter cities embrace the vision of tomorrow by designing blockchain applications. What are the examples of blockchain city applications? Most importantly how do cities get benefit from the blockchain technology?
Zug
Switzerland is often regarded as one of the pro-blockchain countries, which has been working on a CBDC (Central Bank Digital Currency). As stated by the Swiss National Bank, digital currency trials for wholesales were successful (Revill & Neghaiwi, 2020). The roots of Swiss transformation in blockchain comes from a small town called Zug. It is the first city to experiment with cryptocurrency payments. Although it was allowed only for enterprises, taxation law has changed. Starting from next February, residents of Zug will be able to pay their taxes in either Bitcoin or Ethereum (Baker, 2020). At the early days of cryptocurrencies, governments were afraid of them due to the illegal usages in dark markets. However, Zug embraced cryptocurrencies and the technology behind them (Grut, 2018). The city has turned into a ‘Crypto Valley’ thanks to a man called Nikolas Nikolajsen. His clarifications helped Swiss to adopt a positive attitude towards blockchain technology. Together with the positive attitude, eased regulations attracted many including the Ethereum Foundation. The headquarters of Ethereum Foundation is located in Zug, Switzerland. The city of Zug also started to use blockchain-based municipal voting, which saves a lot of paperwork and energy.
Smart Dubai
The Dubai Blockchain Mandate, announced in 2020, established a roadmap for Dubai to become the first city fully powered by blockchain in 2021 (Consensys, 2020). Dubai set goals for digital transformation and it desires to become a leading city in the use of blockchain technology. For instance, there is an organization called Smart City University. At the Smart City University of Dubai, students can design their educational paths. Participation in conferences, in person and online workshops, are rewarded with digital certificates. In addition to this, Dubai emphasizes data decentralization by originating a citywide data market. This network provides an easy and secure way to reach data and it does comply with the privacy law (SmartDubai, 2020).
Akon Smart City and Akoin
As mentioned above, existing cities develop techniques to adopt blockchain technology into their ecosystem. However, there is an ongoing project called Akon Smart City that aims to be a center of attraction for Africa. Akon, known as an American singer and songwriter, came up with the idea of Akon Smart City. The project is expected to cost 6 billion dollars, which introduces sustainable goals for the city. African currencies tend to be volatile. For this reason, Akoin will be used as a central currency in Akon City. It also has a marketplace feature aiming to be a leader for DApps (Decentralized Applications). Akoin Foundation encourages young entrepreneurs in Africa by generating a reward system through the use of Akoin (Akoin Foundation, 2020).
Overall, it might be argued that the development of cities and urbanization are an ongoing evolutionary experiment. Local authorities need to realize that catching long term trends are valuable for cities and residents. Why should blockchain technology be implemented into city structures? This is because, blockchain applications help us to save energy, time and money. Considering the carbon emission and lack of resources, it has to be a priority for municipalities. Additionally, blockchain provides transparency for voting systems that empowers democracy and democratic culture. It is a perfect tool to secure justice, which helps people to raise their voices. In the long run, the world is likely to see an increase in the number of smart cities, smart governance and smart states.
References
Poon, L. (2017, 11). Cities Are One Big Evolutionary Experiment. https://www.bloomberg.com/news/articles/2017-11-02/how-cities-became-a-major-evolutionary-force
Corfield, PJ. (2013, 01). The Oxford Handbook of Cities in World History (pp.828–46). Retrieved from https://www.researchgate.net/publication/258512376_Cities_in_Time
Revill & Neghaiwi. (2020, 12). Swiss central bank says wholesale digital currency trial a success. https://www.reuters.com/article/swiss-snb-currency-digital-idUSZ8N2FE01J
Baker, P. (2020, 09). Swiss Canton Zug to Accept Taxes in Bitcoin, Ether From Next Year. https://www.coindesk.com/swiss-canton-zug-accept-taxes-crypto-bitcoin-ether-2021
Williams-Grut, O. (2018, 07). Here’s what it’s like to visit ‘Crypto Valley’ — Switzerland’s picturesque blockchain version of Silicon Valley. https://www.businessinsider.com/what-its-like-in-zug-switzerlands-crypto-valley-2018-6
Consensys. (2020). Smart Dubai: Blockchain Case Study for Government in the UAE. https://consensys.net/blockchain-use-cases/government-and-the-public-sector/smart-dubai/
Smart Dubai. (2020). The Future of Data. https://www.smartdubai.ae/data/our-story/the-future-of-data
AkoinOfficial. (2020, 03). What is the DApp Marketplace? An Introduction to the Akoin Ecosystem. https://medium.com/akoinofficial/what-is-the-akoin-dapp-marketplace-ee243b250fb9
