Blockchain supporting local innovation for local solutions worldwide
17/03/2021, por Angel
Cecilia Chapiro and Ariana Fowler
UNICEF’s Office of Innovation
Empodera.org chats with Cecilia Chapiro and Ariana Fowler, members of UNICEF’s Office of Innovation team. A team within UNICEF that explores emerging technologies and their potential to positively impact the world and the agency’s work, including navigating an evolving and expanding digital realm. The team is composed by scientists, operators, developers, strategists, and designers working to develop prototypes, conduct research, and invest in startups across various frontier technologies, all in service of improving the lives of children and young people around the globe.
How does the UNICEF Innovation Fund support Local Innovation for Local Solutions?
The UNICEF Innovation Fund is a pooled funding vehicle investing in early stage, open-source, emerging technology with the potential to impact children on a global scale. It also provides product and technical assistance, support with business growth, and access to a network of experts and partners. The UNICEF Innovation Fund is the first financial vehicle of its kind in the United Nations and enables UNICEF to learn from and to shape markets of emerging technology that exist at the intersection of $100 billion business markets and 1 billion persons’ needs.
To date, Innovation Fund has made strategic investments in digital public goods in the areas of machine learning and artificial intelligence, drones, augmented reality and virtual reality, accessibility and blockchain. There have been 100 investments in digital public goods across 57 countries. By providing flexible funding to early-stage innovators, it allows UNICEF to quickly assess, fund and grow open-source technology solutions that show potential to positively impact the lives of vulnerable children.
“Innovation Fund has made 100 strategic investments in digital public goods across 57 countries in the areas of machine learning and Artificial Intelligence, drones, augmented reality and virtual reality, accessibility and blockchain”
UNICEF has also invested in seven blockchain startups, each working on a different use case, in a specific market. In 2019, the Innovation Fund announced the UNICEF CryptoFund, a vehicle by which UNICEF can receive, hold and disburse donations of cryptocurrencies ether and bitcoin. Following the structures of the Innovation Fund, companies are selected to receive investments in either bitcoin or ether.
UNICEF has launched a cryptocurrency denominated fund. Cryptocurrency for Financial Inclusion? How was it born and how does it work?
In 2019, UNICEF launched the CryptoFund to explore what it means to operate in a digitally financed future and provide UNICEF the opportunity to receive, hold and disburse donations of cryptocurrencies ether and bitcoin. As part of the broader UNICEF Venture Fund, the CryptoFund makes crypto investments in companies that are developing early stage, open-source technologies, software and data-driven solutions, or research underlying these solutions, to address the most pressing challenges facing children and young people locally and globally. It is the first crypto investment vehicle within the UN system.
The setup of the fund to support open-source investment was a two-year process and required collaboration across the entire organization. How was that process?
The launch of the CryptoFund prompted UNICEF to have a new set of conversations about what it means to use digital assets and explore an innovative way of redistributing resources. Particularly, it allowed for better transparency and efficiency in tracking, where funds come from and where they are spent, as well as shorten the settlement time of fund transfers. To highlight some of these elements, UNICEF launched the CryptoFund website for the public to view the funds received and what investments UNICEF has made.
“UNICEF is the first international organisation to accept, hold and use cryptocurrency in its original form without converting it to fiat money”
As it pertains to dealing with cryptocurrency, UNICEF is the first international organisation to accept, hold and use cryptocurrency in its original form without converting it to fiat money. Launching the CryptoFund was a collaborative effort that involved several internal divisions at UNICEF. The project’s team looked at the CryptoFund from a variety of lenses: accounting, legal, operational, technical, and more to better understand the opportunity presented in using digital assets with the humanitarian and development field. We’re following similar principles to that of the UNICEF Venture Fund – investing in projects that are both open-source and located in emerging and developing markets.
How can blockchain Technology increase the transparency of funding?
One of the inherent features of blockchain is the ability to have immutable, end-to-end visibility in the movement of funds, assets or information. All that is required is access to the Internet. There are various ways to view blockchain transactions and we have developed a tool allowing the public to view how cryptocurrency moves in and out of the UNICEF CryptoFund.
Leveraging the transparency of blockchain, the UNICEF Innovation team has built the CryptoFund website which has sections that show when funds are received, in which startups the funds are invested into, including transactional proof that the transfer took place. Any of the transactions that flow through UNICEF HQ can be seen on the “track” section of the website, including the blockchain transaction ID.
Cryptocurrency and digital assets have been promoted as a means to greater financial inclusion for the world’s unbanked. What are the main results so far?
Through the CryptoFund, UNICEF has been able to move funds in a matter of minutes as opposed to traditional transfers which may take hours or days. This speed has enormous potential to reduce the critical time it takes to deliver essential goods and services.
In which main areas of the world do you put your efforts and research?
UNICEF focuses on supporting the most vulnerable children and youth in the world, with programme countries primarily located in developing and emerging countries. Our 3 areas of exploration include: 1) redistributing resources in an innovative manner, 2) increasing efficiency and transparency in internal processes and 3) incentivising the creation of open-source digital public goods. As a blockchain team, our functional work consists of: 1) supporting the UNICEF Venture Fund, 2) developing and deploying internal prototypes to help the organisation learn about blockchain in a hands-on manner, such as The Atrium, and 3) learning initiatives, via our SURGE hackathon series, in collaboration with the UN Innovation Network and internal trainings.
Blockchain technology provides a new, global community for researchers, practitioners, designers, developers, and policy makers to explore the moral, ethical and responsible innovation activity triggered by blockchain technology. As an expert in blockchain, what is your vision on those ethical questions that are not yet answered?
Blockchain as a technology is quite young – just over ten years. This means that the UNICEF is simultaneously learning about the impact of blockchain while developing and building systems to leverage its potential. The UNICEF Innovation team abides by the Principles for Digital Development in its work.
Project Connect is a data and analytics platform developed by the UNICEF Ventures Team that aims to map every school in the world and each school’s access to the internet. The platform also powers a much larger collaboration between UNICEF and ITU called Giga, an initiative to connect every school in the world to the Internet and every young person to information, opportunity, and choice. What are the actions taken to fight the digital divide?
The Giga team has accelerated work on key connectivity initiatives, particularly focusing on providing connectivity and necessary services to 13 high-impact countries in the months between April and September. Below are several actions that UNICEF and ITU are taking to fight the digital divide through Giga:
Broadband Connectivity: Developing a comprehensive strategy to map unserved schools; create better and/or new financing programs to bring together diverse public and private funding; initiate large-scale procurement and improve transparency in monitoring.
Critical Software and Content: Identifying, strengthening, and scaling proven and new innovations in software, learning systems, and content that support tele-work, tele-education, tele-health and financial services, all of which can be deployed at low-cost, scaled, and customized to local languages
Digital Financial Services: Since Giga will use public blockchains for monitoring and managing payments, UNICEF and ITU are able to work with governments and providers to explore how connectivity infrastructure can also lead to extensions of online banking and electronic financial networks, potentially enhancing the efficiency and accountability of government programs that disseminate payment.
What are your opinions and predictions on how everything is going forward during and after the global crisis of COVID-19 and how can disruptive technologies generate sustainable solutions?
UNICEF Innovation is deploying innovative solutions for disruptive, positive impact via Giga and investments via the Venture Fund. Specifically, Giga, the initiative launched by UNICEF and ITU in September 2019 to connect every school community to the Internet and every young person to information, opportunity and choice, is supporting the immediate response to COVID19, as well as looking at how connectivity can create stronger infrastructures of hope and opportunity in the “time after COVID.”
Solutions which were announced as part of our most recent funding round are working to address COVID-related issues both for vulnerable populations, such as in tracking food delivery, as well as within their own products. For example, the funding is being used to transition traditional VR products to WebVR, making it more accessible. COVID is forcing everyone to adapt and our team is excited to support promising solutions through this transition.
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