The United Nations High Commissioner for Refugees (UNHCR) is embracing blockchain technology and zero-knowledge proofs to strengthen its mission around the world. According to UNHCR Finance Minister Carmen Hett, the technology is well-suited to help the organization streamline aid delivery while protecting the sensitive data of more than 114 million refugees.
Hett said this while speaking at a panel discussion held in Switzerland as part of Decentral House. The event brought together web3 experts from organizations such as Cardano, the United Nations, and the World Trade Organization (WTO) to discuss the latest developments in the ecosystem.
UNHCR has already been using blockchain technology for almost a year, announcing the launch of its first blockchain-based payment solution in December 2022. According to Hett, the move was met with skepticism both inside and outside the agency, but was quickly accepted. It was approved after the first implementation was successful.
Fast and free support via cryptocurrency
One way the UN agency is using blockchain to accomplish its mission is by implementing a Cardano-based solution to provide crowdfunding and distribute aid to millions of refugees around the world. Digital wallets make it easy for both donors and refugees to donate and receive support from anywhere in the world, while a distributed ledger helps maintain 100% transparency at all times.
UNHCR programs also build digital literacy and give refugees more control over their finances. This was one of the main challenges when first implementing the program, as blockchain-based solutions tend to be highly technical and not easily accessible.
But Hett and his team quickly realized that the freedom and increased efficiency of the new system was enough to generate the engagement needed to get the program running. Now, as UNHCR “scales up” its program, other agencies can take action and implement similar solutions.
Funding through cryptocurrency staking
In an effort to boost blockchain fundraising, UNHCR launched a staking pool where the public can delegate cryptocurrency funds to support its operations. Dubbed “Blockchain for Refugees,” the project operates in a similar way to other Cardano staking pools, with one key difference: all rewards go to UNHCR.
This approach allows all ADA (Cardano coin) holders to passively support the UNHCR mission while also contributing to the efficiency and security of the network. As a result, the funds raised are used for UNHCR’s field operations (80%) and the Innovation Fund (20%).
Cardano allows ADA holders to retain control of their assets while staked, enabling them to support agencies without losing underwriting power. Additionally, contributors can withdraw their funds at any time without paying a penalty, making this new form of staking an innovative approach that could make a significant difference.
Why Cardano?
As Cardano digital identities and payments become more common, UNHCR is using them to better protect refugee data. Hett said the agency is exploring zero-knowledge proofs and other privacy-preserving technologies “to ensure that the identities of those at risk are in fact safe and secure.”
According to UNHCR, Cardano was chosen to collaborate on the project because of its “highly engaged” community and unique staking mechanism. Since the launch of the project, the agency has also worked with Cardano-based projects such as TURF NFT and NMKR, Fabio Giampietro and Valuart, Goat Tribe, etc.
By starting small but expanding impactfully, UNHCR is creating a blueprint for blockchain to further empower and provide self-determination experiences for refugees around the world. Indeed, with cryptocurrencies and blockchain already proving to be valuable resources for global philanthropy, the model being piloted by UNHCR and Cardano could spur further adoption by humanitarian organizations.