By Things are sure moving in the right direction for blockchain technology in Malaysia. It was recently announced by the Malaysian government that they are set to consider blockchain technology solutions for the three biggest industries in their country, namely renewable energy, palm oil, and Islamic finance.
The Malaysian Industry-Government for High Technology or aptly abbreviated as MIGHT is the special task force who are said to be leading up the project to adopt blockchain tech for the above-mentioned industries in a concerted effort to better transparency, sustainability the efficiency of logistics as announced in a report that was published last week.
The Renewable Energy Sector & Blockchain Technology:
MIGHT is currently in talks with various energy companies in Malaysia to identify the ways in which they could utilise blockchain technology in an effort to increase the adoption rate of renewable energy in the country. How would this work though?
Simple, when a seller adds energy to the blockchain, the transparent nature of the system means they also need to declare how the said energy or electricity was generated for the buyers to analyse.
As a result of this blockchain adoption, consumers are now able to purchase their choice of green/renewable energy. They have the option of purchasing this energy from energy companies or even privately, let’s say for example for owners of solar panels who have excess stores available to sell.
Malaysia’s sole provider of utilities -TNB or Tenaga Nasional Berhad has also explored blockchain solutions and their General Manager of Innovations has previously stated that the company has hosted various workshops to glean how they can utilise blockchain and how to approach adoption with business owners.
The Palm Oil Industry & Blockchain:
Even though the palm oil industry is currently seen as a controversial sector as a result of many bad practices, child labour accusations and environmental damage, the Malaysian government is looking to discern whether blockchain technology could help with the identification of ethical approaches to palm oil production and also assist with consumers and the identification of the source of their palm oil before they were to purchase it.
8% of Malaysia’s GDP is as a result of the agriculture sector with 43% of agricultural revenue being generated by the sales of palm oil. Clearly, this makes it a sector that could truly benefit from the adoption of blockchain technology.
The benefits for buyers are there but blockchain technology will also the government with the identification and regulation of the palm oil industry.
Islamic Finance & Blockchain:
Islam forbids the usury, which is the collection of interest on a load. They believe that money has to have a real-life commodity and can’t be generated from just more money. While Western fractional banking is based on debt creation, Islamic debt creation must be backed by gold or other commodities.
These strict Islamic ethical regulations in their banking sector are responsible for increased overheads in Malaysia. The government is turning to blockchain technologies to search for a way to reduce this costs and stay within the confines of Sharia laws. Many banks in the middle east are beginning to attach debts to gold units and these debts are represented as smart contracts upon blockchains. There are also crypto firms in both Malaysia and Dubai that have sums of gold pegged to cryptocurrencies which allow for debt creation that is compliant with Sharia law.
If countries like Malaysia are looking to adopt blockchain tech despite the constraints of Sharia laws, it’s a prime example of how blockchain could be adopted by many industries around the world. Do you think the adoption of blockchain technology could assist with the growth of industries in other countries? Let us know by commenting below.
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