eBusiness Weekly
Tawanda Musarurwa
KPMG, a global network of professional firms providing audit, tax and advisory services, says it can assist Zimbabwean companies looking to adopt blockchain technology.
The blockchain is a decentralised, distributed and public digital ledger that is used to record transactions across many computers so that the record cannot be altered retroactively without the alteration of all subsequent blocks and the consensus of the network.
Although it has come to be largely associated with cryptocurrencies, KPMG South Africa associate director Nevellen Moodley, said the blockchain technology has countless practical uses, especially in business.
“In terms of real-life uses, payments is the biggest one, identity, voting. It is being used in agriculture from the time seed is planted to all the way to when it lands in the store so that you can see the source of your products, it’s being used in mining for research and development. These are just some, but there are thousands of other uses as well.
He was speaking on the sidelines of a KPMG Audit Forum in Harare yesterday.
“In terms of helping Zimbabwean companies adopt blockchain technology, we would help them in putting, first, a digital strategy in terms of say, here’s your ecosystem, here’s your clients, what are they actually buying from you. What would like to offer them in the future and how will they use the blockchain technology to assist them to reach that endpoint.
“We then get whatever partners we need, because we have partnered with a lot of firms globally. The playing field for blockchain is not limited to Africa.
“And it’s not only blockchain, but a combination of all technologies, but how do you use that technology to enable that vision going forward. So we help them with putting a business case together, helping them assess the business case, get the right numbers together and understanding what the assumptions are. And once they have decided, we help them run the journey.
Distributed ledger technology
The blockchain system is actually a type of distributed ledger.
According to Coindesk — a website specialising in digital currencies — a distributed ledger is at its core a database held and updated independently by each participant (or node) in a large network.
“The distribution is unique: records are not communicated to various nodes by a central authority, but are instead independently constructed and held by every node. That is, every single node on the network processes every transaction, coming to its own conclusions and then voting on those conclusions to make certain the majority agree with the conclusions.
“Once there is this consensus, the distributed ledger has been updated, and all nodes maintain their own identical copy of the ledger. This architecture allows for a new dexterity as a system of record that goes beyond being a simple database…
“The invention of distributed ledgers represents a revolution in how information is gathered and communicated. It applies to both static data (a registry), and dynamic data (transactions). Distributed ledgers allow users to move beyond the simple custodianship of a database and divert energy to how we use, manipulate and extract value from databases — less about maintaining a database, more about managing a system of record,” says Coindesk.
Cryptocurrencies have discovered one of the best ways to utilise the distributed ledger system that even global central banks’ nonchalance towards cryptocurrency is unlikely to stop its growth.
“Bitcoin is just one application that runs on the blockchain technology. There is nothing stopping us from creating an insurance app and running it on blockchain,” said Moodley.
Earlier this week, Reserve Bank of Zimbabwe governor John Mangudya, said the central bank was open to blockchain technology.
