LocationsBlockchain with purpose: what it is and how it works
September 15, 2025
Blockchain's main feature is its decentralized and distributed nature.
In recent years, the word blockchain has become increasingly common in conversations about technological innovation. From cryptocurrencies to NFTs —the acronym for non-fungible tokens, which refer to unique, non-replicable digital assets— this technology has sparked both enthusiasm and skepticism. In Argentina, its public image has been largely associated with financial speculation and digital bubbles. But far from the hype and empty promises, another narrative is also emerging: one where blockchain technology becomes a tool for addressing real challenges, with a focus on social, environmental, and public issues.
To understand its true potential, we must first lift the veil and ask: what’s really behind this technology? Essentially, it is a digital infrastructure that allows information to be recorded securely, traceably, and immutably, without relying on a central intermediary.
This technology is also one of the key components of what is known as the third generation of the Internet or “Web3.” This new stage seeks to give users back control over their data and digital assets, promoting decentralized and collaborative models based on community participation.
The main feature of blockchain is precisely that: its decentralized and distributed nature. Instead of being controlled by a single entity or stored on a central server, the system works thanks to a network of participants who share and synchronize a common digital record in real time. This is known as a peer-to-peer (P2P) network.
In a blockchain network, the nodes seal transactions under a reliable structure that can survive if one of the parties is compromised.
Whenever someone carries out a digital transaction on a blockchain network, a new block is generated: a data record representing that interaction—such as sending cryptocurrency, casting an electronic vote, or information about a product’s supply chain. Before being incorporated into the system, this block must be verified and validated by network participants. Once approved, it is added to a continuous sequence of previously recorded blocks, forming what is known as a blockchain.
Thanks to this collective chained structure, information cannot be modified without the consensus of the network, making it virtually impossible to alter. Thus, instead of relying on a central authority, it is the community of users that collaboratively validates, updates, and safeguards the system.
The transaction is sent to a peer-to-peer network. Each participant verifies it, creating a new block that is added to the chain.
This capability, when applied judiciously, can be truly useful. Like any tool, its impact lies not in the technology itself but in how it is used. It’s not about putting everything on the blockchain, but rather understanding in which contexts it adds value and in which it does not.
At the UNDP Argentina Acceleration Lab, we are dedicated to exploring this lesser-known side of blockchain: concrete experiences where technology is integrated with ethics, participation, and purpose in real processes. In this sense, we look for clues, or early signals of change, that show us how we can leverage this technology to improve people's lives. Technology alone changes nothing — but in the right hands, it can help change everything.
Identity and access: when data becomes empowering
The Digital Identity for Inclusion Project (DIDI) and its ai·di app are examples of how blockchain can improve access to rights for those living in vulnerable situations. The application functions as a digital document holder under the principles of self-sovereign identity (SSI).
This application allows users to generate and manage digital credentials that certify, for example, that they have completed their studies, have work experience, have accessed certain services, or have made payments. This allows them to have easier access to opportunities such as jobs, credit, training, or social programs; demonstrate their reliability to institutions without the need for a banking history or formal documentation; and reduce structural barriers in contexts where informality, lack of documentation, or mistrust limit access to rights.
From farm to table: traceability that builds trust
In a country like Argentina, with a strong agri-food tradition, technology applied to agriculture—or Agtech—is key. Ventures such as Carnes Validadas and BlackBull show how blockchain allows the entire journey of a product to be tracked, from its origin to the consumer. Extended traceability is enabled through a simple QR code that reveals the entire history: production practices, actors involved, and certifications.
The Wayra organic honey project also stands out as a pioneer in the integration of this technology. Its experience demonstrates how this tool can promote fair trade that work in harmony with nature. To make this possible, the rural communities involved were trained in the use of these technologies, strengthening their digital capabilities and reducing the technological gap.
Protecting the environment can also be tokenized
Among the most popular uses of blockchain, Biotoken and Tokenize-IT demonstrate that it is possible to turn climate actions into digital assets. These platforms transform CO₂ reduction, absorption, or avoidance into digital assets that can be exchanged. In this way, they connect those who generate emissions with those who help reduce them. Using distributed ledger technology (DLT), they enable secure, traceable transactions without intermediaries.
A special use of these technologies is the Vinalito Project in the province of Jujuy, which seeks to preserve the native forests of the Gran Chaco while promoting the social and economic development of local communities. It uses blockchain technology to leave a reliable and transparent record of each restoration action (such as plantations or carbon avoided), and thus generate and trade carbon and biodiversity credits that can be used by companies to offset their environmental impact.
Governments building trust through digitalization
One of the great advantages of blockchain in public management is that it improves transparency, traceability, and trust in information. From the Official Gazette to public procurement platforms such as Compr.ar and Contrar.ar, the Argentine government already uses blockchain as a seal of integrity (“a kind of digital timestamp”). This allows for digital proof that the content of any document existed at a certain point in time and has not changed since then.
Another noteworthy initiative is the Citizen Folder in miBA by the Government of the City of Buenos Aires. This is a new decentralized digital identity (DID) system that facilitates data interoperability and enables digital interactions without intermediaries: booking appointments, starting procedures, and checking their status, and accessing official documents such as birth certificates, student certificates, and driver's licenses.
In line with the advancement of Agtech, SENASA's Citrus Traceability Information System (SITC) and the Single Permanent Inspection System (SUFP) incorporated blockchain to track agri-food products from origin to end consumer. Integrating this technology allows the State to securely certify data, advance digital governance, and establish reliable and verifiable standards throughout the entire production chain.
Ecosystems that build community
Organizations such as LACChain, Blockchain Federal Argentina, Córdoba Blockchain Hub, Fundación Blockchain Argentina, and #AprendoCripto are working to bring this technology to diverse sectors. From training to the development of open infrastructures, they are driving forces behind the “blockchain for good” ecosystem in Latin America.
Moving beyond the hype doesn’t mean losing enthusiasm — it means learning how to use it wisely. And on that path, it is essential to go through the discomfort of learning, which involves stopping delegating, asking questions, accepting what is not fully understood, and recognizing that there are technologies that can be complex, but also useful. It is a necessary step if we want to actively participate in the decisions that are shaping the future.
UNDP Argentina is promoting and exploring digital developments based on blockchain technology, aimed at strengthening public policies and generating innovative solutions that improve people's lives. Change will not come about simply by uploading everything to the blockchain. But it can arise from processes in which different actors—technologists, local governments, social organizations, cooperatives, activists—are encouraged to think and experiment together. The key is to build agreements, share lessons learned, and design roadmaps that respond to real challenges.