In Davos in 2023, blockchain was declared a transformative force for global good. While significant progress has been made in the past two years, familiar challenges remain.

While innovation has improved with the rise of crypto markets and the maturation of regulatory frameworks, the question remains to what extent blockchain is realizing its potential to create social impact.

Promising developments in the use of blockchain in humanitarian aid and development show how this technology can make a difference in the real world. For example, in Rwanda, small farmers had the opportunity to rent affordable tractors through blockchain-supported platforms.

The Hello Tractor app has increased agricultural productivity and improved incomes for hundreds of thousands of farmers by transparently tracking equipment usage, payment and maintenance via blockchain.

Similarly, transparency in global supply chains has been achieved through tokenization in the Philippines, Kenya and Bangladesh. Additionally, EY’s OpsChain technology has emerged as an important tool in reducing fraud while ensuring transparency and accountability in public finances.

However, accessibility and infrastructure issues remain a major obstacle to wider adoption of blockchain. Blockchain solutions generally require a strong internet connection and technical knowledge.

However, internet penetration is at very low levels in regions such as South Asia and Sub-Saharan Africa, where humanitarian aid applications are needed most.

Although some blockchain projects have developed compatible solutions for low-tech regions, systemic infrastructure improvements are required for wider adoption.

Another important problem is scalability. Large blockchain networks such as Ethereum may face problems such as high transaction fees even if they have switched to a proof-of-stake model.

Although Layer-2 solutions such as Polygon attempt to alleviate these problems, they create complexity in regions where technical knowledge is lacking. At the same time, during periods of intense market fluctuation, transaction costs can become unaffordable for humanitarian aid projects due to network congestion.

In the regulatory framework, the European Union’s MiCA (Crypto Asset Markets) regulation was an important milestone. MiCA has provided a framework for crypto assets and stablecoins, providing transparency and security to the industry. However, regulations still vary in other major economies.

For example, while sharing authority among regulators creates complexity in the US, Singapore offers a more innovation-friendly licensing framework. This regulatory diversity creates challenges, especially for cross-border humanitarian projects.

Blockchain technology is at a critical turning point in 2025. While projects like Hello Tractor and OpsChain have demonstrated the potential of this technology, collaboration, inclusive design, and strong regulations are required to make a bigger impact.

Blockchain could be the cornerstone of global development; but closing the gap between promised effects and practical results remains a significant challenge.