I Remember staying at an extended stay hotel while watching a documentary about Bitcoin. A coworker of mine whom I convinced about investing in the stock market had been investing on cryptocurrencies for about a month and I decided to research if it made sense to get in. I purchased a book about crypto assets and I was immediately hooked. Satoshi Nakamoto had a vision of a world in which the financial crisis of 2008 could have been avoided altogether. In the last paragraph of his white paper, Satoshi wrote: “We have proposed a system for electronic transactions without relying on trust.” In a poetic fashion, Satoshi also inscribed the following text in the genesis block: “The Times 03/Jan/2009 Chancellor on brink of the second bailout for banks.”

Back to the basics of Satoshi’s vision

I liked the concept of freedom and transparency that Satoshi proposed, and just like that I became a preacher for blockchain technology and it wasn’t long before I had a chance to talk to Erman about it. At this point, given that the team was already focused on empowering charities to capitalize their funding efforts, I realized there was a benefit for the public itself: “The ability to bring transparency to charities”. You see, a platform for viral challenges does not require blockchain, which is why the team had beta versions of the app available for download months before they decided to integrate blockchain technology into it. The need for blockchain technology in this setting comes from Satoshi’s vision in which we do not have to rely on human ethics but rather on algorithms being solved by a computer. Erman liked the idea and it got him so excited that he then introduced me to his partner Kevin Moran. After our introduction he asked me why blockchain technology made sense for their platform below is a summary of my response:

1. Decentralization

2. Transparency

Decentralization — Why Blockchain Benefits Matters

People get excited when I tell them about this project and how we can bring transparency to charities. If you have ever been to an ATM in Mexico to withdraw money, you may be familiar with a message displayed in the image below, which I easily found at the following link. For those who don’t speak Spanish, the text displayed says something like:

YOU CAN HELP THE FRIENDSHIP HOUSE PROGRAM WITH A DONATION OF $10.00 PESOS FOR THE BENEFIT OF THIS CAUSE

WE MEXICANS KNOW HOW TO HELP EACH OTHER WHEN NEEDED MOST

WOULD YOU LIKE TO DONATE?

DONATION NOT SUBJECT TO CLARIFICATION

The donation made through an ATM, for example, is made by a centralized entity. We usually trust that at least the first part of the transaction was carried out correctly when we see our balance reduced by the amount we donated, it is the second part that we as the public have a problem with. Does the money actually get to our intended destination? Before blockchain technology, we had no financial alternatives for our goodwill or for anything that required trust.

The Transparency Overhaul

Let’s reiterate the last sentence from the ATM window again, just for fun. “Donation not subject to clarification.” I am no lawyer, but my understanding is that the bank who owns the ATM will not clarify anything about the donation, which probably includes an explanation of what exactly the friendship house is about, who they help or why they deserve my donation. I have no problems making donations, but if you want my money, you need to earn it. Please read what Satoshi wrote back in 2009 for the perspective of what WUG can solve and to realize how much trust we have placed upon the incumbent entities in the following link.

With blockchain technology, transactions are available and free for everyone to see, meaning we don’t have to trust third parties. I have a vision that I believe the WUG team shares, in which the WUG ecosystem, with the support of blockchain technology, brings transparency to prevent bad actors from taking the money that good causes and charities deserve. I imagine good actors willingly participating in the WUG ecosystem with sponsors having great visibility over the impact of their donations and I imagine as a result, charities will benefit from their ability to capitalize on viral challenge campaigns like the Ice Bucket Challenge. The result, sponsors who are more willing to support in a decentralized and transparent system that can be trusted.

Enough is Enough

With the transparency provided by blockchain technology we no longer have to wonder whether or not charities have met their targets for specific campaigns, or if any of the third parties “lost” some of the money in the way. Let me give you another example where us as sponsors for charities can benefit.

In Mexico, I grew up watching the show “Teleton”, a show that urges viewers to donate money for the rehabilitation of children with disabilities. The show usually lasts 24 hours and throughout the day the hosts will update on how much more is needed to reach the goals. In 2013 as an example, about $32 million dollars were raised. The next year, there was a controversy and they had to run an additional 4 hours to hit their goals. The problem I have is not with the charity that has been created and sponsored by the television network, but with the fact that I have to trust them to tell me the truth about how much money has been raised by the entire country. Would it be impossible for them to report a lower amount than what they claim? Would it be impossible for the bank facilitating deposits to take a small cut and not report it? I get a receipt when I donate but what does that mean? How can I compare that against everybody else’s transaction/confirmation number to determine what the true total is? Without blockchain, we just have to trust all parties to behave ethically.

Creating a Bridge Between Charity and Sponsor

The WUG ecosystem will leverage blockchain technology not only so that we don’t have to trust third parties, but also eliminate them if their involvement is not necessary. If I am a willing sponsor for a charity, why can’t I just donate directly the same way I would if I stumbled upon a person on the street asking for 5 dollars to get a meal. In theory, the charity and sponsors should be capable of transacting between themselves, but they don’t. Which is why we rely upon centralized third parties to connect the two in a convenient fashion. Blockchain technology allows users to transact with each other, without the overhead and need for third-party intermediaries.

Was Blockchain Technology Absolutely Necessary?

The team is talented enough, from what I can perceive, to the extent that they already had contemplated the ability to make donations from within the platform in their roadmap and I am sure they would have been successful at implementing this feature had they not decided to use blockchain technology. This is very much a feasible goal from a technical standpoint with or without blockchain technology. But then, you would need to trust that the team is acting honestly while managing the charity transactions.

I am excited to see where the ecosystem grows and how fast the blockchain technology can mature. In my next blog, I will talk about another aspect that can make a difference for WUG, which is the ability to make blockchain technology convenient and easy to use for everyone.