Blockchain For Government

Blockchain For Government

by Jennifer Brody

What technology has the potential to mitigate poverty, increase government transparency, and secure financial transactions? Blockchain.

If you are familiar with blockchain, it is likely because you have heard of Bitcoin. Yet, few people know that this innovative, relatively new technology has promising implications far beyond cryptocurrency. A growing number of startups seek to harness the revolutionary power of blockchain to improve public services.

Essentially, blockchain is a long chain of pieces of information (or “blocks”) that are linked together and recorded in a widely distributed database. Hacking one block would require not only the key for that particular block, but also the keys for the adjoining blocks. In other words, infiltrating a blockchain would require the unique key for every single block of the chain. That is next to impossible to achieve, as there are millions of blocks in one chain. Thus, the longer a blockchain, the more secure it becomes.

Blockchain is also highly secure because multiple parties, commonly referred to as “miners,” verify the data stored on the distributed ledger. In this way, the system is highly decentralized and likely more transparent than existing financial systems or registries. It is the 21st-century peer-to-peer network that open source enthusiasts celebrate. However, not all blockchains are public. Some are fully private with more stringent access permissions, while others are semi-private. Generally speaking, traditional financial institutions utilize fully private blockchains, while organizations or companies with a civic mission tend to gravitate towards open source blockchains.

One such public blockchain startup called BanQu uses the technology to create an economic identity for the unbanked. The social enterprise aims to combat extreme poverty by connecting to the global economy those without access to capital. Chemonics, a US Agency for International Development contractor, recently partnered with BanQu to launch the Blockchain for Development Solutions Lab.

In the same vein, blockchain can also bring unregistered property into the formal economy. Last year Hernando de Soto’s Institute for Liberty and Democracy combined forces with the Bitfury Group to begin a land titling pilot project in the Republic of Georgia.

Blockchain also has application in the voting space. In an age of heightened alarm over electoral fraud, blockchain is especially promising in this field. This is because each vote becomes immutable after it is recorded on the blockchain, unlike penetrable electronic voting systems currently in use.  A few blockchain voting startups have emerged in recent years, such as Voatz, where I direct policy and communications.   

Despite the benefits, some government officials remain hesitant to support blockchain technology for a number of reasons: namely, its decentralized structure and technological complexity, coupled with policymakers’ tendency toward risk aversion.

Blockchain entails devolving authority from a centralized hierarchy to a decentralized, flat structure. Understandably so, this prospect alarms government officials. After all, in the ideal democracy, we trust our elected officials to properly manage public goods and services–everything from land titling to election administration. As such, a government’s willingness to cede authority undermines the very reason why we elect officials to run government in the first place. If we operate under the assumption that government officials cannot be trusted, then why buy into representative democracy? This is a difficult question to answer. Yet, I, for one, am of the belief that the more citizen watchdogs we have, the more democratic the system becomes. More concretely, in the case of blockchain-based voting, validating peers–or “miners”–must jointly agree on the veracity of a vote in order for it to be recorded on the blockchain. This means that the election administration is not the only entity validating the vote.

Another common stumbling block that entrepreneurs face in trying to market blockchain solutions to governments is difficulty communicating complex technical concepts both clearly and concisely. In my time working for Voatz, I have struggled with articulating how blockchain provides a secure voting solution while maintaining my audience’s interest and, perhaps most importantly, their confidence. This challenge is nothing new or unique to blockchain. Programs like the MIT International Policy Lab, the American Association for the Advancement of Science, and the Blockchain Trust Accelerator Initiative work to translate advanced technology solutions into succinct governance applications by bridging the divide between science and public policy. MIT International Policy Lab Program Manager Daniel Pomeroy told me that one of the greatest impediments in translating scientific solutions into policy goals is that scientists are comfortable reporting with uncertainty, while policymakers tend to speak in absolutes.

This uncertainty particularly comes through when addressing blockchain security.

Scientifically speaking, we cannot report with absolute certainty that a blockchain cannot be hacked. Indeed, if hundreds of thousands of the most brilliant computer scientists in the world joined forces to dedicate their entire lives–and the lives of their successors–to hacking a blockchain, and they convinced all of the third-party “miners” to cooperate, it is technically possible to infiltrate. (For all intents and purposes, this scenario is not realistic. It is like saying that technically it is possible for everyone in the world to hop on their right foot at the same second while drinking lemonade out of an orange-and-white striped straw. It is within the realm of possibility, but the probability is negligible.) However, considering governments’ natural aversion to risk, blockchain vendors must carefully choose their words when explaining how blockchain is highly secure, yet technically not bulletproof. When I deliver this meticulously crafted narrative, I often feel like I am performing an explosive ballet on top of precariously assembled eggshells. To be sure, complexity does not translate well into the realm of the viral soundbite, through which many lawmakers must communicate their stances on policy issues. Fortunately for professionals in my position, government officials become less skeptical upon learning that Wall Street and leading financial institutions have largely adopted the technology.

A few months ago, I met with Democracy International’s Innovation Director Michael Baldassaro to discuss the promise of blockchain-based voting. His feedback both inspired and disheartened me. Baldassaro told me that the emergence and potential widespread application of blockchain technology reminds him of when the Internet was first created: it was revolutionary, yet very few people understood the technology and, as a result, very few believed in its promise to change the world.

While it may well be an uphill battle, I am confident that in the coming years we will see more blockchain product adoption among governments worldwide. It may take decades, or even centuries, for blockchain’s full potential to come to fruition, but for now I am excited to plant the seed.

Note: The views expressed in this article are the author’s own and do not necessarily represent those of Voatz.

About the Author

Jennifer Brody directs policy and strategic communications for civic tech startup Voatz, a blockchain-based mobile voting platform. Jennifer graduated in August 2016 from The Fletcher School with a Master of Arts in Law and Diplomacy. Her studies culminated in a multimedia project on the net-native "Central American Spring." Prior to Fletcher, Jennifer was a staffer on the U.S. Senate Judiciary Committee for Senator Herb Kohl [D-WI] and worked in the Office of Senator Joe Manchin [D-WV]. While in the Senate, she served as a technology and foreign policy adviser. Jennifer received her Bachelor’s degree in Political Science and Spanish from the University of Wisconsin-Madison. 

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