By Dr Margie Cheesman
EXECUTIVE SUMMARY
Web3 technologies and applications have gained traction as solutions to the most intractable problems like humanitarian disaster, forced migration, socio-economic exclusion, and financial crises.
Communities at risk, including refugees and low-income populations are therefore now at the frontline in absorbing the risks and failures of Web3 technological development. Poverty and disaster are major frontiers of capital accumulation by technology companies and infrastructure providers striving for dominance in ‘emerging markets’.
Web3/blockchain companies and start-ups are developing models and patents in settings like refugee camps where tax, data protection and other regulation, accountability, and the rights, liberties, and choices of users are diminished.
Web3 refers to a collection of ideas about the future of digital society and blockchain is the enabling technology. The key ideas associated with Web3 are decentralisation, trust, truth, security, and privacy. But in practice, Web3 involves many potential concepts and technologies, all surrounded by misleading PR, myth, and misunderstanding. Marginalised groups — refugees, low-income populations, and other communities with restricted socio-economic access, rights, and protections — are key test subjects of Web3 experiments. But Web3 technologies do not address the root social and economic problems these groups are facing, and they introduce a range of new risks to people who are already in disadvantaged positions.
The report demonstrates 3 key areas where Web3 experimentation from start-ups, humanitarian and development aid organisations, and other non-traditional commercial partners is targeting marginalised groups: Payment, Currency, and Identification.
Payment
Proponents suggest blockchain will democratise payment, facilitating direct, cheap, and borderless digital transactions. Yet, there are significant concerns around the for-profit motives and surveillance issues when blockchain infrastructure replaces established payment systems.
Humanitarian payment projects such as WFP’s Building Blocks and Oxfam’s Unblocked replace established payment providers with non-traditional commercial partners in tech and other industries like IrisGuard, ConSensys, and supermarket companies. Blockchain-based payment rails can disrupt users’ trusted interactions with aid industry providers and provide inadequate recourse mechanisms.
Currency
Proponents of crypto and other alternative currencies suggest they provide a lifeline to people without reliable access to stable currency or liquidity. But they lack stability, usefulness, and accessibility.
Alternative currencies do not resolve the main issues in mainstream financial systems, especially exclusion due to the identity documentation or credit score requirements of banks. Most schemes reinforce inequalities by exposing those with the most to lose to new risks such as scamming and financial volatility.
Cryptocurrencies and alternative currencies may also enhance surveillance and profiling of marginalised groups. For example, Worldcoin has collected 450,000 high resolution images of bodies, faces and eyes from people in countries across the Global South.
Identification
Decentralised identity schemes seek to facilitate forms of power and agency for technology users, especially people whose protection under national law is in question. Web3 identity schemes claim to allow users to selectively disclose and minimise sensitive data sharing. However, not all do, and this puts the onus on users to manage personal data.
Many blockchain-based systems are tracking and surveillance tools rather than reducing the collection of personal data. Decentralised ID schemes do not mitigate the political structures that hamper certain communities’ access to financial, health, and social services and mobility.
RECOMMENDATIONS
Based on the findings of the report, we recommend:
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Web3 technologies, especially untested cryptocurrencies, should not be imposed experimentally on marginalised communities.
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Public institutions must coordinate around vetting private Web3 companies.
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We need qualitative evidence-based research on the design, maintenance, and use of Web3 technologies.
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