Recently, I had the privilege of being at the opening of the new IBM Asia-Pacific Headquarters in Singapore, a site that includes a Business Innovation Lab and Garage for Blockchain. The highlight of the day was an address by the guest of honor, Tharman Shanmugaratnam, the deputy prime minister of Singapore. DPM Shanmugaratnam is also chairman of the policy steering committee of the International Monetary Fund and has many other distinctions.

Reflecting on his address, it occurred to me that DPM Shanmugaratnam may be the first world leader ever to utter the word — let alone authoritatively discuss — blockchain.

About Blockchain Technology

Blockchain is a business tool that can greatly accelerate the transactional efficiency, transparency and integrity for which Singapore has long been noted. If judiciously employed, blockchain permits entirely new ways of enabling businesses.

With blockchain, a business community or ecosystem can be more assured that its financial data, document transfers, physical transactions, product deliveries and monetary activities are not only authentic, but agreed to by all. This can be done while appropriately safeguarding the security and privacy of all data.

Why blockchain now? How did blockchain technology come about? In every generation, there are a few business cycles that permit use of synergistic new technologies, perhaps even for unanticipated uses. For example, our present financial system stems largely from the London Big Bang of the mid-1980s, an electronic acceleration of trade between previously decoupled paper-based brokers and dealers.

Physically, this Big Bang was only possible due to the advances in fiber optics and cellphones. Although both technologies were only recently available to the engineering world, they were leveraged — with surprising speed — to connect a large array of business interests in just a few months.

Similarly, blockchain today leverages recent advancements in software and low-cost memory, cryptography, communications and computation. Among many initiatives, IBM is a leader in Hyperledger, one of the main open-source implementations of this technology. IBM consultants and developers are helping customers cost effectively implement blockchain on a variety of platforms.

Practical Uses of Blockchain

Blockchain both provides assurance and promotes efficiency in complex transactions, be they a one-time occurrence or ongoing. For example, in the U.S., even the most prosaic sale of a house may involve multiple contract reviews, inspections, payments of escrow, engineering reports, mortgages, realtor fees and other slow-moving, paper-heavy transactions.

With blockchain, once there is consensus on the facts, the mechanics of the document transactions and payments may be automatically conducted by smart contracts and automatic money transfers — but only with the transactional basis and authenticity being agreed to and validated by all. Similarly, in the health care field, a medical blockchain can help prevent a patient from receiving the same dose of medicine twice or perhaps forgetting to take a dose when necessary.

The chain of the blockchain provides continuity, community, strength, flexibility and security. This “chainablement” will provide entirely new models for doing business while reducing paperwork drudgery and improving the speed and accuracy of transactions. There is currently little doubt that blockchain technology will soon be found in fields ranging from banking to driverless car control and in many uses presently unforeseeable.