A number of countries are taking a very close interest in the potential of Blockchain technology. It could help data sharing and protection, provide citizens with a digital identity and even, in the longer term, host the administration of a range of public services.
In March the United States Congress submitted a report pointing out just how useful Blockchain technology could be for local authorities. “Government agencies at all levels should consider and examine new uses for this technology that could make the government more efficient in performing its functions”, says the report, underlining: “Blockchain technology has the potential to help the economy function more efficiently and securely.” This transparent, secure and decentralized ledger system provides an excellent means of storing information and guaranteeing the integrity of transactions between several parties. This also makes it potentially very attractive for local authorities. Among their main roles is the need to inspire confidence in ordinary people who come under their administrative responsibility. While virtual currencies, especially Bitcoin, which use the Blockchain, are often regarded with suspicion by the authorities – China has even banned InitialCoin Offerings (ICOs) as a means of raising funds in virtual currencies – but the potential of the Blockchain approach, i.e. the architecture underpinning those ‘cryptocurrencies’, goes far beyond this current use and is generating a great deal of enthusiasm.
The US Federal Government has implemented a number of pilot tests, with the public health sector, the transportation sector and the army. Several US state administrations, including Colorado, Illinois and Delaware, are also taking an interest in the technology. Meanwhile, the government of India is studying how to use Blockchain technology in education, health and agriculture and Dubai has set up a special Council to look into its potential in various fields including health, ownership title, local public services and import/export arrangements. China, the Netherlands, Singapore and Canada are all also studying how they might use Blockchain technology to help achieve a variety of national goals and objectives.
Updating public institutions
Protecting personal data
Franco Amalfi, Head of Innovation, North America at Oracle Public Sector, believes that one of the most promising uses of the Blockchain for governments is in data protection. Countries hold a lot of sensitive information on their citizens, which is regularly targeted by cyber-attacks. In 2015, attackers hacked into the United States Office of Personnel Management, the US federal government agency that manages the government’s civilian workforce. They got hold of fingerprints, social security numbers and the CVs of twenty million Americans.
The Blockchain has the dual advantage of being very difficult to hack and being highly encrypted. As a decentralized database, it has no central vulnerable point. Given that the data is stored throughout all the points in the network, you would have to hack more than half the participants at exactly the same moment in order to compromise the integrity of the database. Moreover, while the Blockchain is a public ledger, it is also encrypted. A person’s private information is unreadable unless you have the cryptographic key, which only the person concerned has. Hackers who manage to get into the system would find themselves with unusable data. These two factors make the Blockchain an ideal tool for storing citizens’ confidential data.
opening up public data
Promoting open public data
The Blockchain could also serve to open up public data, which would both raise citizens’ trust in government and help build a wide variety of those digital applications that we increasingly depend on in our daily lives. Every time you look at the weather forecast on the Internet, or use your GPS, you are in fact using data supplied by the government. The goal of ‘open data’ is still far from being fully achieved, however, as shown by the recent move by the Trump administration to delete a slew of data from the White House website, notably information on the government budget and details of White House staff salaries, all information that was made public by the Obama administration.
Useful for patent or copyright claims, the Blockchain could also ensure that a government agency or company verifiably published its data.