Is There A Blockchain For Social Good?

Ali Raheman
Aug 9, 2019 · 4 min read

Ethereum consumes over $ 0.7 billion in electricity annually & ranked second dirtiest blockchain after bitcoin. Yet, most “blockchain for good” challenges have judged Ethereum based startups as winners. That compels us to ask: is there at all, a blockchain for social good?

Source credit; Pixabay

A social good is something that benefits the largest number of people in the largest possible way, such as clean air, clean water, healthcare, and literacy.

Sustainability is most often defined as meeting the needs of the present without compromising the ability of future generations to meet theirs.

Where sustainability professionals are likely to see the most action: among utilities or renewable energy developers seeking a more efficient way of pricing and selling clean power; at consumer products companies and retailers seeking a better way of validating supply-chain claims; and among banks and insurance companies interested in verifying the provenance of minerals, commodities or raw materials.

Ethereum Blockchain For Sustainability?

The problem is most entrepreneurs working on “social good,” “sustainability” are social entrepreneurs and not blockchain experts. Almost all of them use Ethereum blockchain as their network backbone.

Let’s look at how sustainable Ethereum itself is. It is the most energy consuming blockchain after bitcoin. It eats up at least a quarter to one third energy as bitcoin does A typical Ethereum transaction gobbles as much power as an average U.S. household uses in a day. In economic terms annually Ethereum mining costs over $711 million for consuming 712 TWh of energy which is equivalent to the entire country of Bolivia. Can any solution based on Ethereum be sustainable or do “social good?” Yet in the frenzy that blockchain has created, even most “blockchain for good” challenges have judged Ethereum based startups as winners.

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The latest is the Newsweek Blockchain Impact Challenge Awards 2019, which selected five winners, four of which are Ethereum based and one claims to use a centralized blockchain! Can a blockchain even be centralized? As if that was not enough, UNICEF has a UNICEF Ethereum lab in Argentina, and in a recent challenge they selected 6 startups, for a grant of $100,000 each.

Isn’t it a travesty of social justice if a blockchain that consumes $0.7 billion worth of energy annually, good enough to light up a whole country for one full year, deployed for sustainability applications?

A London based global think tank, claims to be working for a sustainable and peaceful world published a 12-page report on environmental sustainability with blockchain, but avoided mentioning any specific iteration of blockchain. Perhaps, because as with everyone, for the authors Ethereum defines blockchain.

There is a very interesting case of a New York sustainability startup — LO3 Energy, who recently attracted funding from the oil giant Shell. They confessed to have started with Ethereum, but shifted to a Ethereum hybrid. Ethereum hybrid! I guess Ethereum is a cool term for marketing if you are in blockchain business. There’s another very interesting case reported by Harvard Business Review.

since 2007 Estonia has been operating a universal national digital identity scheme using blockchain.”

Full two years before anyone ever heard of blockchain from Satoshi Nakamoto’s 2009 seminal paper on cryptocurrency!!

The Estonian digital identity scheme uses Keyless Signature Infrastructure (KSI) technology developed by Guardtime, much before the advent of blockchain. But neither they have migrated their system to blockchain /DLT, nor acknowledge their credibility. On the contrary this is what they have to say regarding DLTs:

They will eventually be assigned to the dustbin of history.”

But the funny thing is that the recent hype has made them call their KSI technology as “KSI Blockchain”

IBM Hyperledger Fabric Is No Less Shallow

IBM aggressively promotes Hyperledger Fabric which is a private permissioned blockchain, meaning neither it is immutable nor transparent, nor incentivizes peers, and on top of it costs $120,000 to deploy, and perhaps much more to maintain. Lacking those features can it even be called a blockchain? With the high cost, and lack of decentralization. immutability and transparency wonder what social good it is capable of? Yet it sponsors “blockchain for social good challenges.” Cashing in on the blockchain hype perhaps.


So can we have a blockchain for social good? Not, until the game of hype comes to an end. Not, until Ethereum hype remains synonymous with blockchain hype. Not, until Ethereum’s marketing machinery uses its mind boggling market cap to promote it for something that it wasn’t designed for. That’s not to deny Ethereum’s undeniable place in the history of blockchains, as the first ever iteration of smart contracts. But as much as its days of glory are enshrined in gold for ever, they are over.

It’s time we looked for sustainable blockchains that keep adding to the sea of iterations every so often.

The Startup

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Ali Raheman

Written by

Co-Founder, Autonio Foundation,

The Startup

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