Page 80 - U4SSC Blockchain for smart sustainable cities

(5) Blockchain applications
In blockchain technology, the smart contract is the most adopted in the smart city context (85% of
the cases). It allows derivatives to be executed automatically, and enables a variety of transactions
without the need for centralization, particularly in the case of voting systems for tamper-proof ballots
and election results (Active citizen in Moscow or the e-vote system for cell-towers in South Tyrol).
However, the use of Cryptocurrencies applications seems not to be critical in the smart city context.
None of the use-cases is planning to use cryptocurrencies in their blockchain project. Even though
across the sector, most of the blockchain applications entail the use of cryptocurrencies. The use of
token applications is also highlighted as an essential element for blockchain adoption, despite the
fact that only one case confirmed the use of a token (e.g. Energy system). Studies showed benefits
from introducing cryptocurrencies and tokens on blockchain platforms as technology or productivity
progress, such as the tokenization of the e-participation. It is also shown to increase the user adoption
and empowerment.

(6) Type of cryptography

The most frequently used cryptography in blockchain for cities is the public key cryptography and
hash function. There is also an increasing use of the zero-knowledge proof, which is a new technology
developed to allow institutions to transact on the public blockchain while still protective of citizens’
sensitive and private data. However, it is a concern as it remains unclear if citizens understand what
they agree on, the level of information they want to disclose, to whom they want to disclose their data
and their legal rights in case of data misuse or data breaches.

5.4.2 Blockchain application in the smart city context

The decision between traditional databases or blockchain is not simple. The most appropriate solution
depends directly on the application scenario . There are several models, decision trees and frameworks
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that were developed to support the decisions on the applicability of blockchain technology. These
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models vary according to the business needs, to the requirements of the system, to the industry and
other dimensions and level of details are provided.

Some elements seem to be recurrent, and most of these models agree on determining the type
of blockchain based on whether the organization should adopt public/private or permissioned,
permissionless should be selected.

After studying more than 20 decision models, this report selected and analyzed 14 dimensions that are
supported with evidence from academic studies to define the factors that are critical to consider for
the suitability and applicability of blockchain in the context of smart, sustainable cities. The purpose of
this report is not to propose a new decision model for applying blockchain, as there are already several
relevant decision models proposed in the literature. Moreover, the UN recently published a Practical
Guide on Blockchain Technology in the UN system. The main purpose is better to understand these
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main factors for informed decision making. These variables are summarized in Table 11.

70 U4SSC: Blockchain for smart sustainable cities