Blockchain, AI and Sharing

by Lisanne Huizing

Due to the urbanization phenomenon, more people are going to move to cities. This will lead to more congestion of traffic, more pollution, and a necessity for more resources in cities among others. We will need more of everything than we have right now, in order to generate food and products. Resources are not endless, and they will become scarce in the future.

“Smart Cities” have to solve this problem of rapid movement of goods, people and capital. By integrating technology, both cities’ and citizens’ behaviors can be understood. People can become involved and empowered by giving control over resources to more stakeholders by combining circular and smart technologies. It will give citizens the possibility to more actively govern their own resources at a lower geographical scale. Adaptive systems will be very beneficial for our future needs.

Sharing & Circular Economy 

With the Sharing Economy, a new phenomenon has arisen and it provides opportunities to redesign urban planning and access to locally shared resources. This will create a shift from possession-based, to a service-based economy. In order to use less resources in a growing and more demanding society, it will become necessary to make better use of the capacity of resources that is already existing. 

When you look at a car that you only use in the weekends, for example, by sharing this with other people, it can also be used during the week. Once the car is optimally used and it comes to the end of its lifecycle, you can move towards the next step; circularity. 

Although the Sharing Economy and Circular Economy are two different elements, they are connected. Because where the Sharing Economy ends, the Circular Economy begins. Together, they influence the taking shape of practices and optimization of processes. Cities can play a big role in this reality. 


This is where blockchain comes in the picture. Blockchain is a decentralized electronic ledger system, due to the lack of a middleman (banks), that creates a cryptographically secure and unchangeable record of any type of transaction with any kind of value. This technology can be applied to any asset that needs to be stored, distributed, or transacted. This can be money, goods, property, work or even votes. 

An example of an environmentally friendly Sharing Economy activity with the help of blockchain would be to distribute energy by redistributing excessive energy from solar panels back to the grid and getting rewarded for that. 

The potential of blockchain lays in the fact that it contains decentralized data that is resistant to censorship. Therefore, it is especially useful when you need to share data. It can facilitate peer-to-peer payments, manage records, track physical objects and transfer value via smart contracts. 

This information cannot be altered, stolen nor tampered with. It is always clear where the information comes from. 

When you know what is going on in real time regarding your product and its composition, it increases the value of this product. Especially when it can be fundamental for the classification of the product.

 For example, when it is labelled as organic. When the origins and destination of the product or its components can be tracked, it enables trust. The availability of product information therefore reduces the transaction costs that the establishment of trust normally creates.

In order to tackle sustainable challenges with the help of blockchain, private and public parties will have to collaborate and build platforms to achieve this. Platforms have the potential to compare distributed data of resources, which will cure the current information asymmetry present between multiple stakeholders. This will enable better informed decision-making processes, for example, and an optimal balance of demand and supply. 

This can potentially create decentralized resource-preserving solutions. By linking blockchain to all steps in the process, it becomes possible to trace where each component comes from and what that part’s (chemical) composition is.

Blockchain on its own however is not the optimal solution. The information that you want to incorporate in the blockchain in order to increase transparency can be gathered with the help of Artificial Intelligence (AI).

 To go back to the example to provide energy by redistributing excessive energy from solar panels back to the grid and getting rewarded for that. The tool to sell and follow the distributed energy is blockchain, but the real main character is the Artificial Intelligence. 


Often AI is used for platforms. In these situations, the more the platform is being used, the more the AI system learns. Cities contain a lot of data. This data contains valuable information for municipalities to respond to the changing urban environment, allocate resources wisely and plan for the future. Smart technologies will give individuals and companies access to real time data that enables them to make better decisions. Consequently as applies for AI as well, the smarter cities will get, the more responsive they will become

Appliances and apps that use Sharing Economy tools collect substantial amounts of data, which can be used for other purposes. AI will manage the enormous amount of data in a way that it can be used efficiently. This way data will become more accessible and that will make it more valuable. 

When looking at the Sharing Economy in combination with the characteristics of blockchain and AI, you can see that they contain the same type of elements. All three of them are peer-to-peer, open-source, transparent and consequently reducing transaction costs. In integrated Smart Cities, urban data will be collected and processed through patented AI systems. This data will become available on platforms managed with blockchain systems and provided to individuals within the Smart City without competition. Excessive resources will not go to waste this way and the demand for exhaustible resources will diminish.

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