Blockchain applied to Made in Italy.

An innovative tool for promoting local products, governance processes, and digital assets at the national level.

In recent years, digital transformation has become one of the main paradigms through which innovation is created, understood as a new model of organization and management of processes by individuals, companies, and organizations. This represents a radical change from analog processes, impacting and propagating evolution in various spheres of human society, including social relationships between individuals and companies, marketing models, modes of purchasing goods and services, channels for accessing information, and the characteristics and concept of money.

In this regard, it is interesting to reflect on how digital processes and technologies are creating a whole new world, in which physical proximity is no longer a necessary condition for interacting with the different actors that form the economic and social context. This fully realizes the reflections of the sociologist Emile Durkheim regarding the transition from a pre-modern society based on a low level of work differentiation and relational networks mostly based on proximity interaction to a modern society, in which the degree of specialization and division of labor, products and services has increased exponentially along with an evolution of the relational universe towards the formation of relationships no longer based on familiarity with our interlocutors, but rather on their social function, making economic, social, and financial relations possible, such as buying a product at a supermarket, where the two nodes of the action are often complete strangers.

With digitalization, one can argue that an even greater leap has been made, considering that economic and social operations not only do not depend on familiarity between interlocutors, but, taking the example of buying a cryptocurrency on an exchange, the interlocutor is a digital platform, often completely removing human participation from the process, at least in terms of user perception.

This evolving context increasingly requires mechanisms that can guarantee a high level of trust, a determining factor in facilitating any type of transaction for users of digital products, services, and relationships; a high degree of trust is, in fact, a fundamental element in facilitating any type of transaction, particularly those in which the identity, accountability, and reputation of the interlocutor are increasingly blurred.

Regarding these new needs, blockchain technology can play a crucial role thanks to some characteristics such as decentralization and the method of recording data uploaded to the blocks, which makes fraudulent deletions and modifications more difficult.

On the one hand, this technology is currently known primarily for its financial application with cryptocurrencies, virtual money exchangeable without the need for intermediaries in the strict sense. On the other hand, there are some alternative, less known, and less experimented upon declinations that have the potential for impact in many fields and productive sectors.

For example, the reliability of data collected on the blockchain makes this technology particularly interesting as a tool for traceability of agri-food production processes, a pillar of Italian culture and a strategic economic sector: over 300 products with quality certifications (DOP, IGP, SGT), more than 500 DOC, DOCG, IGT wines, for a value added in 2021 of 64 billion euros and export value of 50 billion euros; values ​​that, however, pale in comparison to the market value of Italian Sounding, or the improper use of names, logos, and images that emulate Made in Italy, but have nothing Italian about them, a market that, according to Coldiretti and Filiera Italia estimates, is worth more than 100 billion euros.

In this regard, blockchain technology could prove to be an important tool in combating food fraud, allowing Italian companies to defend the numerous high-quality productions that make up Italy’s gastronomic heritage. In this context, blockchain can be used by both certifying bodies and companies on their own initiative to collect and distribute data on production processes, strengthening the bond of trust with the consumer and allowing easy access to information such as production date and time, origin of raw materials, production methods, and other aspects that the individual company or organization deems relevant to certify and transmit. An especially interesting application, which requires increasingly deep integration of blockchain technology with other digital systems, particularly the Internet of Things and Artificial Intelligence, in order to increase the reliability of data and promote high levels of consumer trust.

Another application, currently little discussed, of blockchain technology is that of Decentralized Autonomous Organizations (DAOs). Through cryptocurrencies, it is possible to create organizations whose operations and decision-making processes occur in a decentralized manner through the purchase of governance tokens, virtual tokens that confer voting and fractional ownership rights to participating users. Typically, these organizations are formed around a shared goal among participants. Although the legal framework is still unprepared, it is interesting to reflect on the potential future implications of these organizational models, which have the potential to become an entirely digital alternative to the creation of companies in which ownership and management are distributed among participants based on their financial commitment to the project, replicating some characteristics of corporations, as well as becoming a useful governance tool for consortia and associative organizations to directly involve members in decision-making processes and operations.

A third, better-known application, and the last one I will focus on in this article, is that of Non-Fungible Tokens (NFTs), a technology that allows for the creation of unique tokens associated with multimedia content such as images, videos, and audio files. An NFT represents a programmable ownership certificate for digital products, allowing artists and creators, as well as companies and organizations, to sell digital assets while maintaining complete control over ownership rights, distribution methods, and royalty applications. Furthermore, in many initiatives, the user who purchases a particular NFT is entitled to benefits connected to its ownership, such as access to exclusive clubs or the right to use the image or audio file for commercial purposes.

In short, blockchain technology has the potential to revolutionize many areas, from allowing artists and creators greater control over their works to providing an interesting opportunity for companies and organizations to build a new source of revenue, as well as an innovative marketing and customer loyalty tool by offering discounts and access to exclusive products and services for all those customers who decide to purchase and hold a particular Non-Fungible Token in their wallet.

In conclusion, provided that companies, individuals, institutions, and organizations can seize the opportunities and resolve the practical challenges, it seems, and is desirable, that blockchain can be an innovation tool with the potential to play an incredibly relevant role for Italy’s economic, social, and cultural heritage.