INTRODUCTION

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The aftermath of natural disasters and humanitarian crises usually leaves millions of people in desperate conditions, requiring attention. Still, traditional networks for disaster relief and humanitarian aid, which may be useful include shortcomings like inefficient allocation of funds, lack of accountability, even corruption. Such tendencies can inhibit timely delivery of much-needed assistance contributing to the worsening of a situation. However as information technologies advance, cryptocurrency emerges as a revolutionizing force in humanitarian aid practice that will enable quick provision of much needed assistance including more clarity and cost effectiveness.

Unlike fiat currencies, Bitcoin, Ethereum and other cryptocurrencies operate within largely decentralized networks, hence the existence of blockchain technology that maintains a permanent and transparent record of transactions. This core attribute makes them the most relevant for disaster relief operations where accountability and speed to the ground matters most. This will use cryptocurrencies rather than traditional money/pensions to avoid intermediaries and ensure that the aid organizations deliver the funds to where they are needed without any unnecessary delays or costs.

Moreover, displaced individuals can use cryptocurrencies for straightforward financial assistance or other useful resources like tokenized rewards, crowdfunding of humanitarian projects, and blockchain-based identity management. Such uses clearly demonstrate the increasing ability of the different types of cryptocurrencies to revolutionize disaster relief and humanitarian aid.

• PROVIDING DIRECT FINANCIAL HELP USING CRYPTOCURRENCY

Cryptocurrency has made it possible to directly send aid to areas afflicted by disasters without needing a bank, so therefore making it easy to send financial aid to disaster-stricken areas. In many disaster-hit areas, transferring cash may be difficult due to the absence or destruction of core banking services. This can be addressed with cryptocurrencies as they allow users to send and receive money almost instantaneously with just an internet connection and a digital wallet.

As an example, during the 2015 Nepal earthquake, a lot of people turned to Bitcoin as a faster way to bring supplies to the communities affected by the catastrophe. The Blockchain technology was used by organizations such as the BitGive Foundation, allowing users to donate their money and later see how it was used. This process strengthened the trust of the donors and proved the efficiency of cryptocurrency to resolve the issues of red tape.

In addition to that, as the transaction costs of sending money via blockchain are so low, cryptocurrencies eliminate the burden of fees which would have otherwise gone to the global aid. Remittance service traditional has been known to charge up to 10% of the transaction amount while the blockchain technology based transfers usually have a charge of a few percentage points. This is pertinent, especially in large scale disasters as every penny saved is a penny that may assist in saving lives and reconstructing the ravaged areas.

• CROWDFUNDING AND SELF-GOVERNED FUNDRAISING

This is possible thanks to blockchain technology which supports self-governed crowdfunding giving individuals and institution the ability to raise funds for any project aimed at improving the conditions after a disaster. Giveth and AidCoin are two platforms that make it possible for fundraising activities to be done on the blockchain, where fans are able to see what their money goes to in real time.

This was the model during the COVID pandemic when crowdsourcing decentralized solutions provided assistance to the most affected health care providers and vulnerable people. Those campaigns utilized cryptocurrencies, so they avoided all the in waiting times and limits of traditional fundraising. Deploying smart contracts made the process even better by processing how funds will be channeled out based on already set parameters, which ensured that there was efficiency in resource use.

Besides, the decentralized funding model means that local people and community based organisations are in charge of the relief assistance. They are often the ones in the particular communities so they will know how to best use the resources given. The use of cryptocurrencies enables them to connect directly to donors all over the world, making it easier to decentralize and focus the effort on the relief effort.

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• SUPPLY CHAIN TRANSPARENCY AND LOGISTICS

The importance of crises information systems in general, and disaster supply chains in particular can be enhanced through cryptocurrency and blockchain technology. In such situations, food, water, and medical supplies must be delivered without delays. However, all these factors are the researched supply chain bottlenecks for the majority of crises organizations.

Supply chain management in blockchain, involves several activities from sourcing to the supply of goods and services providing adequate space to cover every transaction to be recorded on the blockchain ledger. Such systems allow organizations to monitor the movement of goods and the availability of the supply chain in order to prevent it from rechannelling or sinking. For instance, blockchain technology was employed in the allocation and distribution of aid during the Beirut explosion in order to safeguard against abuse and ensure fairness during the distribution.

The elimination of awkwardness associated with transferring inventory control, as well as releases of payments to suppliers and logistics service providers, would result from the increase in smart contracts. Funds are able to be automatically credited to suppliers once their goods have been received thus eliminating unnecessary time loss while ensuring that the supplier is held accountable for their goods. Trust is developed by this kind of transparency and everybody involved in the operations of the disaster relief becomes more efficient.

• MANAGEMENT OF IDENTITY FOR DISPLACED INDIVIDUALS

Displacement of populations is one of the consequences of humanitarian crises and nature’s calamities. It is estimated that there are over 26 million refugees worldwide and many lose their identification documents in the process. Without any document that establishes their identity, significant barriers are placed on the access of such people to aid, medical care and other life saving interventions. Blockchain identity systems are addressing these gaps by providing a secure and mobile identity for displaced people forcibly.

With the help of blockchain, displaced people can develop and maintain their digital identities on the decentralized network. These identities cannot be altered and are always securely stored online which means even in the absence of documents they can depend on these identities for their basic needs. For instance, refugees are one group of the people who could benefit from the identity management through block chain technologies, form being discriminated as well as excluded from assistance;

Apart from enhancing access to humanitarian assistance, blockchain identity systems have the potential to integrate displaced populations into the formal economy. It would also allow them to get blockchain aid, spend it in the local economy and help in faster recovery.

CONCLUSION

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The use of cryptocurrency and blockchain technology in disaster relief and humanitarian assistance is transforming systems that have been ridden with structural issues like over-reliance on intermediaries, opacity, and theft. These technologies facilitate direct transfers, self-organizing platforms for raising funds, tracking the flow of resources, and providing secure means of personalization, making service delivery systems more efficient and fair across the world.

With the increasing number of people using cryptocurrency, its prospects in humanitarian work, particularly in disaster response, are likely to be promising, opening new ways of improving resilience and recovery in response to crisis situations.