For most of this decade, Germany’s capital city of Berlin has been seen as something of a Bitcoin hub, with a number of early adopters in the artsy Kreuzberg neighbourhood accepting the top cryptocurrency since it first sprung up. Now, crypto-associated startups and investors are hoping to make virtual currencies more mainstream and accessible to average consumers, honing in on the development of one type of technology in particular: Blockchain. Let’s examine how this digital currency boom is bringing venture capital to Berlin and how it will affect everyday services for citizens.
Blockchain-based sharing services
Bitcoin and other cryptocurrencies are rising in price, but what may be the key to offering secure, sharing-based services that will benefit citizens is not necessarily these digital currencies—it’s the development of the technology they run on. Referred to as Blockchain, this digital ledger records transactions, or blocks, and adds each transaction to the series of previous actions to create a connected chain that is monitored by independent computers. Blockchain technology offers cities a secure network that is less likely to be compromised by cyberattacks, since hackers would need to “compromise 51% of the systems to overcome the hashing power of the target network,” according to SmartCity.
The next step for cities in terms of incorporating Blockchain into their systems is the combination with the Internet of Things (IoT), which will open up a wealth of new services. Dubbed BIoT (Blockchain + IoT), cities and businesses will have the power to access data from sensors in a similar style to pulling up a website on a smartphone. In Germany, the automotive world is looking to Blockchain technology as a secure payment method for connected cars in terms of charging or parking. Cities can also incorporate this technology into current infrastructure with solutions like connected traffic lights that respond to rush hour. As for how Blockchain will benefit consumers, Berlin startup Bitwala is turning to Bitcoin banking, making this type of technology (and cryptocurrency) much more user-friendly by offering one streamlined German bank account where consumers can buy and sell bitcoin, as well as receive payments and manage finances.
While Berlin may be considered the “cryptocurrency capital of Europe,” other smart cities, such as Dubai, are already engaging in Blockchain technology to create smart transactions, such as the replacement of paper contracts with smart contracts that place the entire trade finance cycle on a single, secure platform.
As cities start adopting Blockchain and BIoT technology, they can offer citizens a secure and reliable way to access services such as healthcare records and e-voting, while incorporating the technology they need to improve smart solutions with a system that is less prone to one of the greatest worries of smart cities today: cyberattacks.