Blockchain prepares its revolution for smart cities

Blockchain, a distributed and extremely secure database, is one of the furious horses that pull the electrified trolley of smart cities. We are approaching an exciting turning point.

It's been a long time since sensor-embedded infrastructures ceased to be a dream for architects and engineers. The first effective experiments with an intelligent infrastructures-for example, with highways that automatically distribute traffic and charge a quantity or another depending on the density of each of the lanes, have been showing surprising results in the United States for years. The same can be said of the suits that measure the vital signs of the miners or the workers that descend to great depths in the operations of the tunnels of the English Channel.

Blockchain or chain of blocks is one more force, very important to tell the truth, that adds to this transformative context that lead the massive implantation of sensors, the storage and analysis in the cloud of the billions of data that they emit and the incorporation of supercomputers and artificial intelligence as the most efficient means to convert them into information. The automatons, the more data they analyze, the more they learn to find patterns and solutions that escape us from human beings.

The open company is a trillion corporation of anonymous transactions every day. Smart cities are small open societies where these transactions will be governed, to a great extent, by mass data, mobile devices, automation and artificial intelligence that ensures that machines communicate with each other with little human intervention. Blockchain will allow transferring assets without having to have slow and expensive centralized intermediaries (banks, for example) verifying and authorizing operations. Thus, if we send money to someone, that transaction is monitored by a node of computers connected to the distributed database, and it is registered. Duplicities or abuse, until now, have been impossible.

Jorge Ordovás, member of the Competition Center of Blockchain of Telefónica, points out that the systems based on this software "allow to store information in a distributed way among multiple actors, providing higher levels of trust, traceability and security for the development of digital services in the environment of smart cities (public administration, payments, energy, logistics, health, etc.) ".

José Antonio González Florido, Global IoT Business Development Manager of Telefónica, also believes that the blockchain will help smart cities in "the management of large amounts of data in real time and with the support of the new 5G connectivity, when necessary to guarantee the reliability, transparency and veracity of the information and, finally, in the configuration of a totally reliable and safe digital environment that provides each user with only the information he needs to know ".

The expert expects historical changes in public institutions thanks to the smart contracts that make blockchain possible. It refers to a type of digital contracts programmed to be self-executing in certain circumstances and that could allow, for example, that cars communicate directly with the municipal parking areas by directly updating the time and cost of permanence ... or that a good part of the work of the registrars and notaries were obsolete.

The most interesting thing about smart contracts is that they encourage the city to be nourished not only by citizens' conscious interactions with each other but also by many others that are automated and that allow institutions or machines to exchange information and conduct transactions without intervention. human

According to Alberto Gómez Toribio, expert in blockchain solutions, "the new means of payment and collection powered by the blockchain, especially those that operate in environments with limited connectivity such as IOTA , make it possible for the devices to become prepaid cards and that, therefore, we can operate with them with or without Internet ".

The first large-scale urban experiments where the blockchain and different aspects of smart cities converge have started around the world. A recent study by the consulting firm PwC shows that, thanks to this convergence, in Sweden you can already carry out real estate transactions by blockchain, in Singapore you fight against fraudulent invoices, in South Korea an ecosystem has been created for banks to use massively blockchain and in the United Arab Emirates or Georgia the idea is to dump, in the large database that involves the chain of blocks, almost all the main activities of public administration to make them more transparent and mitigate corruption.

Obviously, we are not contemplating a fabulous landing and the reason is that the customs of citizens have to change and that much is at stake. Ultimately, it is the users who have to embrace new technologies, believe in their usefulness and use them massively to be effective. In addition, we speak of software with a few years of life and that is expected to be applied to some of the issues that most concern the population, from their personal finances to the management of water or electricity. That has not been hacked, many analysts warn, does not mean it is not possible. Gradualism was what could be expected in these circumstances.

Medium term
Anyway, it is expected that, in the medium term, according to PwC, the chain of blocks will revolutionize forever the official records of everything and the way in which the computer systems that deal with security and defense are manipulated. transparency in transactions that reduces corruption or helps create a new electricity market where renewable energies, smart meters and the ability of individuals to produce and share energy intervene more strongly.

Estonia is the EU country that is most daring and which, probably, will lead the community advances in the short term. Spain, Germany, France, Italy, and the United Kingdom will have to eat their pride of great countries and learn from the example, and also from the foreseeable mistakes of the first, of this Baltic republic. Estonia has developed a solution based on the chain of blocks to manage public archives, to integrate and preserve digitized medical records and to register the creation of companies.

Alberto Gómez Toribio points out that the Estonians have benefited from the small size of their country and the agility of their politicians and bureaucrats. That, he adds, "does not mean that countries with more bureaucratic structure can not launch large blockchain projects." The United Kingdom and Spain are a good example of this. The first has deployed "acceleration programs created by regulators and aimed at startups that need answers from the administration in an agile and continuous manner, such as blockchain startups ". The second has opted for Austria, a consortium that encompasses more than 200 companies and whose objective is the development of the first national blockchain multisectoral platform in the world.

The European Union has created an observatory that will collect and analyze different community experiences, identify challenges and assess the socio-economic impact. Jorge Ordovás, from Telefónica, goes further: he believes that it will also "make cross-border cooperation possible in practical cases, bringing together the best experts in Europe and promoting an open forum for technicians, innovators, citizens, interested parties, industry, public authorities and regulatory bodies and supervisors in the field of the blockchain can discuss and develop new ideas in order to learn, intervene and contribute their contribution in an open manner ".

Gómez Toribio shares a comment with global that almost sounds like heresy. It ensures that the blockchain's disruptive potential is not immense and that, for that reason, it does not see that major regulatory changes are needed. What is more revolutionary is what is rapidly growing around you: your concrete applications.

We talk about transferring money or raw materials through symbols or tokens (which are, in reality, digital debt and property titles) or cryptocurrencies. It is cheaper and easier to transfer a digital file indicating that whoever owns it is the owner of 200 tons of wheat that will transfer 200 tons of wheat directly. The same applies to payments: international transfers of millions of dollars a lifetime can pay prohibitive fees. However, if we use, instead of money, a digital symbol that represents these quantities, the relationship between the sender and the receiver is simplified and reduced a lot. Of course, the chain of blocks will keep an up-to-date and hyper-secure record of the transactions whatever the symbols represent.

The security and privacy of transactions in smart cities, especially if we speak of health data as in the case of Estonia, are those that will require the supervision and additional regulations of the data protection agency. If, in addition, the transactions are going to be carried out, as it seems, in symbols and cryptocurrencies, the financial supervisors will have something to say. The public powers and civil society must press, at a time flooded with populists and false news, to demand maximum guarantees against piracy and to prevent an authoritarian ruler from converting smart cities, massive data and blockchain into the preamble of a police state.

We should also ask ourselves what space we are going to reserve for disconnection in hyper-connected cities that constantly interact with us and our mobile devices, homes, and vehicles. The urban parks were a reaction to the big cities and the endless rows of buildings just over 100 years ago. Later, more buildings and infrastructures full of usefulness were built, as now with the digitalization, but also large parks, plazas, ponds, fountains and walks dedicated to calm were erected. Even revolutionaries take a breath. Will we take it?