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Blockchain-Based Smart Cities

 July 19  | 0 Comments

More than half of the world’s population lives in urban areas that are only expected to become more crowded in the coming years. Conditions are worsening with traffic jams, pollution, increased waste production and poor management. But, the rise of new technologies like blockchain now seems to offer a solution. With free-flowing information and better communication, there is hope for salvation. This article explains how blockchain-based smart cities can create sharing economies and lists other uses.

Why Blockchain for Smart Cities

It is disconcerting to think that cities aren’t smart already because they really should be. No urban region should be un-smart as they are generally densely populated and so many lives are lived in it. But, the pursuit of rapid development instead of proper and sustainable growth of many urban regions has landed us in this troublesome situation.

Much of the urban population is always scrambling for resources. City dwellers are generally hustlers looking to benefit from an out-of-control demand for goods and services. This is made worse by scarcity of deliverables. Given this situation, no city can be considered smart anymore if it does not actively promote a sharing economy to make the best use of resources.

Sharing Economy

Development is most dependent on the economy. Without a thriving economy, no region can develop successfully. Economy, on the other hand, is dependent on the supply and demand of goods and services. If these two actively balance each other out, then the economy will be stable and growth sustainable. When there is a scarcity of supply, however, it is difficult. The imbalance may still support growth. Nonetheless, this growth will not be long-term.

The sharing economy is a model for development when there is a scarcity in supply of goods and services. It aims to make the best of under-utilized urban resources like space, transportation, necessities (food, water, clothes, shelter), environment, and other materials to smartly bridge the gap between the supply and demand of goods and services. It is a way to maintain balance in the cost of goods and services, despite an imbalance in market forces.

The sharing economy is of the people. It is run by the people for the people. In it, individuals offer the goods and services that they own or possess on a short-term basis with the goal to meet present demands immediately. Hence, this form of economy lays less emphasis on ownership of resources so that the access to these resources takes precedence.

Components of Sharing Economy

Sharing is fundamentally human and is traditional practice across cultures and nations. But, large-scale sharing has never been possible. Technology is the enabler that can make this happen. Therefore, it is the first component.


Not only does technology provide the connectivity that is necessary for effective sharing, but also the facility of real-time information to make it immediate. We already have examples of how seamlessly technology links citizens with objects and facilities. People travelling in the same direction can now move together in Ubers that are powered by software technology.


The sharing economy is people-centric. It is driven by the people. But, people aren’t used to sharing on such a large-scale. They are more used to sharing their resources with their close and dear ones. Hence, to adopt a sharing economy, there is a need for a shift in perspectives of the people. The sharing economy must foster trust with generosity and maintain it by securing privacy and security of all individuals.

Social Development

The goal of smart cities is development. Hence, it must be that humans and technology align themselves with this objective. All social institutions and activities must be for this purpose. And, all networked individuals must use their computing powers to optimize the use of available resources.

Smart Cities with Blockchain

The blockchain suits the sharing economy and can help build smart cities because of the trust vested in it. It was designed to eliminate intermediaries in digital transactions by making it safe for strangers to exchange assets and data with each other privately on public record. Blockchain transactions involve two keys – a private and a public one. The public one is useful in verifying transactions. While, the private key is useful in ensuring privacy.

Blockchain is a democratic technology – one of the people – because it decentralizes power. It allows humans to organize any activity without any one person or entity gaining full control over it. It achieves this using a proof-of-work mechanism that allows the blockchain to run automatically on distributed consensus. This feature is also critical for effective management of the large volumes of data that populations of sharing, smart cities produce. With distributed computing and distributed consensus, blockchain can foster a community of peers, who will work together to achieve the goal of development.

Blockchain Use Cases

Blockchain is becoming popular among governments to improve their services. The technology has garnered trust and is being tried or used for the following purposes:

For Healthcare in Estonia

The small north-east European country has introduced blockchain to improve its public services, which were already online. With the implementation of this technology, the country’s citizens now have more control over their data which includes sensitive information like medical records. Anyone, who gains undue access to these files can easily be identified with blockchain and will be prosecuted.

For Trade & Governance in Dubai

Dubai was one of the first cities to announce the use of blockchain for smart transactions. The city uses the technology to track its imports and exports. The technology has helped the city replace paper contracts with smart contracts and link its financial and trade systems together. Dubai also uses blockchain for land registries. Inspired by the success of these initial uses, the city is now looking to implement blockchain for governmental services.

For Referendums in Moscow

The city has an “Active Citizens” program, which allows Muscovites to express their views on different topics. The legitimacy of these referenda has, however, been questioned. So, when the opportunity presented itself to use blockchain technology to make these votes more trustworthy, the city’s government ceased it to promote active citizenship.

For Public Services in Taipei City

The city is looking to become one of the many blockchain-based smart cities. Without trust in its digital public services this won’t be possible. Hence, the first project aims to issue citizen cards that will protect all locals from identity theft and voter fraud. Another program aims to keep a check on the air quality in the city by recording data and sharing it online.

For Land Records in Andhra Pradesh

Andhra Pradesh became the first Indian state to run pilot projects for the implementation of blockchain technology. The program aims to transfer land records on to the blockchain. It has inspired other Indian states to also consider the technology.

The state of Maharashtra has announced pilot blockchain projects for a variety of purposes. These projects aim to improve financial inclusion, maintain land and vehicle records, and finance the supply chain processes. Telangana, Karnataka and Gujarat are also evaluating the technology for different governmental services.