Bitcoin was launched in the wake of the 2008 financial crisis, and in some ways, the decentralized currency reflected the widespread anger people had toward the way financial and political institutions handled the economic fallout. And yet, all these years later, Bitcoin’s underpinning technology, blockchain, is embraced by the very institutions at which its creator lashed out.
Blockchain in Government Examples
- Foreign aid
- Government smart contracts
- Law enforcement
- Recording keeping
- Central banking
- Public healthcare
Many states, nations and government agencies are adopting blockchain technology for everything from improving the voting process to making public services run smoother. The following examples illustrate the potential of blockchain in government.
Blockchain in Public Assistance and Foreign Aid
Nothing seems to be more synonymous with government bureaucracy than public assistance programs and foreign aid. Charities and individuals must go through months, even years, of red tape to prove to obtain critical funding.
Blockchain-based welfare programs are improving the process by saving governments thousands of hours of time and millions of dollars on inefficient programs.
Foreign aid has always been a bureaucratic nightmare. According to Foreign Policy, some foreign aid workers, in the midst of intense war or famine, must complete hundreds of pages of grant plans, budgets, a 14-point checklist and be approved by third-party financial institutions to even be considered for foreign aid. By the time the financial aid arrives, the circumstances are usually much worse.
Blockchain’s smart contracts, lack of inefficient third parties and instantaneous cryptocurrency payment methods can help foreign aid become much more impactful.
Here are a few examples of blockchain in government being used to streamline assistance programs at home and abroad,
The United Nations
Location: New York, New York
The United Nations World Food Program created Building Blocks, a platform using ethereum blockchain to deliver aid. The UN completed its first successful trial when it transferred cryptocurrency-based food vouchers to 10,000 refugees in Pakistan. Since the trial, Building Blocks has transferred $325 million to approximately one million refugees in Bangladesh and Jordan.
Location: London, England
The UK teamed up with GovCoin in order to develop a blockchain for welfare payments. The app is a digital version of a “jam-jar.” Crypto is divided into separate accounts, or “jars,” to cover rent, grocery and utility costs. Besides the efficiency of automatic payments, GovCoin also circumvents banks, which can hold much-needed welfare money for long periods of time.
Location: Berkeley, California
Ankr is a cloud-based blockchain infrastructure for businesses. The company has developed a Proof of Useful Work method that lets anyone with idle computers or extra data space to rent out their computing power for data mining. Ankr believes that compensating everyone for using their computers to mine data can lead to a universal basic income, which could supplant a traditional government welfare system.
Denmark’s Ministry of FOREIGN Affairs
Location: Copenhagen, Denmark
Denmark’s Ministry of Foreign Affairs partnered with virtual currency platform Coinify to use blockchain in foreign aid delivery.
The biggest benefit of blockchain for Denmark is the time and money saved by foregoing the involvement of a third-party financial institution. Instead of relying on banks, donors and Denmark’s foreign aid fund can directly send money to groups collecting aid via cryptocurrency.
Blockchain in Government Smart Contracts
We’ve all experienced the headache of red tape, but using blockchain in government may be the answer to ending the public sector’s reliance on paperwork, third parties and physical contracts.
Blockchain-based smart contracts set parameters that parties must agree upon before executing a transaction, but are only initiated if all pre-negotiated stipulations are met.
For example, a local government contracts Acme building company to build a new bridge. Acme charges the government $1,000 for their services. In order to execute the contract, the blockchain’s decentralized nodes will have to unanimously agree that the government has $1,000 to spend, and secondly the government owns the land on which they want the bridge built and finally that the Acme company is legally allowed to construct bridges. Once all criteria are met, the contract will immediately initiate the project.
During the project any violation of contractually agreed upon parameters can be enforced in real-time as opposed to after the fact. Without relying on middlemen like lawyers, smart contracts save time and money, as well as establish trust between parties.
Smart contracts aren’t just for municipal infrastructure projects. According to a study by the U.S. Department of Transportation, seven out of 10 government executives believe blockchain will have a disruptive impact on major public and private sector contracts.
Everything from billion dollar defense contracts to the purchase of public lands could eventually be “smart.” By cutting out middlemen, government agencies can potentially save thousands of hours of paperwork and millions of dollars in redundant fees — and it’s already happening.
We’ve rounded up a few examples of governments and government agencies exploring or implementing blockchain-based smart contracts.
U.S. General Services Administration
Location: Washington, D.C.
Under its Government IT Initiatives program, the US General Services Administration is looking into adopting ledger systems, like blockchain, into everyday federal government use. The agency held the U.S. Federal Blockchain Forum in 2017 and is looking into using smart contracts for patents, trademarks, IT purposes and foreign aid delivery.
State of Tennessee
Location: Nashville, Tennessee
In March 2018, the State of Tennessee unanimously passed Senate Bill 1662, which recognizes the legality of blockchain-based smart contracts. In the bill, the state grants legal authority to those using smart contracts when conducting electronic transactions, protecting ownership rights and securing certain private information. The law is an example of positive blockchain implementation that other states, federal government and even law school programs have modeled since its introduction.
Government of Dubai
Location: United Arab Emirates
Known as the “city of the future”, Dubai moved its judicial system to function on blockchain technology. Coined the “Court of Blockchain,” the network uses smart contracts to improve Dubai’s legal system. Officials believe running on a secure, efficient and transparent blockchain will save the city over 25 million man hours and $1.5 billion annually.
Blockchain in Healthcare
Blockchain is used across the healthcare industry in a variety of ways, from securing patient medical records to managing pharmaceutical supply chains.
Blockchain may also be able to save lives. In 2016, research from John Hopkins University revealed that the third leading cause of death in the U.S. were based on medical errors. These errors were the result of poorly coordinated care like missing information on patient records or incomplete care tasks.
Blockchain can solve issues within healthcare by linking medical record systems to secure software — creating a single view of a patient’s record without putting patient data at risk on the blockchain.
Here are a few examples of how blockchain is being used to provide secure and safe healthcare.
Location: New York, New York
Coral Health uses blockchain ledgers to connect doctors, laboratories and public health authorities. The company also utilizes smart contracts to speed up administrative processes and ensure patient information and treatment plans are accurate. Coral Health’s use of blockchain to accelerate the care process can lead to quicker, safer treatment and improved health outcomes.
Location: Lausanne, Switzerland
Estonia and the United Arab Emirates have used Guardtime to implement in their healthcare and cybersecurity systems. The company also created VaccineGuard, a digital platform connecting vaccine distributors, manufacturers and hospitals. The platform can provide counterfeit vaccine detection by using blockchain to allow easy and secure data sharing between participants.
Location: Denver, Colorado
BurstIQ is a platform that manages large datasets of patient information. In compliance with HIPAA regulations, the company uses blockchain to enable the safekeeping, sale, sharing or licensing of data. BurstIQ’s platform also offers accurate, up-to-date information on patient’s health and healthcare activity.
Public and Private Record Keeping on Blockchain
Federal and state governments have trillions of tax, identification, real estate contracts, birth and death certificates that must be accounted for at all times, along with trillions of archived public documents that must be maintained. Many organizations looking for a way to secure and organize those documents see great promise in blockchain.
In 2022, Shields Health Care Group, a Massachusetts healthcare provider, experienced a data breach that exposed the information of approximately two million people. The breach resulted in stolen identities, billing information and medical records.Identity thieves prey on the vulnerability of government and big bank computers to gain access to passport, social security and banking information.
A simple malicious email to an unsuspecting employee can expose thousands, if not millions, of U.S. citizens to identity fraud. Using blockchain in government has the ability to stop hackers in their tracks through safe identity encryption.
Blockchain’s private encryption combined with unique cryptographic identifiers can allow any government employee or individual to safely and quickly find the proverbial needle in a haystack of information. The following are a few examples of how blockchain is revolutionizing government record keeping.
Illinois Blockchain Initiative
Location: Springfield, Illinois
The Illinois Blockchain Initiative is seen as one of the leading U.S. entities seriously exploring blockchain technology in government. The state-funded initiative is looking into different ways to use the ledger to maintain the data integrity of passports, birth certificates, death certificates, as well as voter registration and social security information. Illinois officials believe blockchain is not only a safer option to store this important data, but a more efficient option as well.
Delaware Blockchain Initiative
Location: Dover, Delaware
The Delaware Blockchain Initiative has explored blockchain in both public record organization and private sector data security. The initiative has mostly focused its efforts on archiving public documents like historical records and laws, but since Delaware is home to roughly 65 percent of all Fortune 500 companies, the state is looking into how to protect the financial information of the companies and their shareholders using encrypted ledgers.
Government of Australia
Location: Canberra, Australia
Australia teamed up with IBM to make the Land Down Under one of the top countries in the world integrating blockchain into its record keeping process. The country is using the technology to combine its passport and birth certificate databases into one blockchain-backed base. Both IBM and government officials believe blockchain brings a heightened level of data integrity and security to record keeping.
Blockchain in Law Enforcement
From maintaining data integrity to discovering crimes faster, blockchain has myriad uses in law enforcement. According to law enforcement veteran and cybercrime investigator Paul Marrinan, blockchain makes records immutable, can track criminals attempting to use false identities and enables secure information sharing.
The greatest attribute blockchain brings to policing is chain of evidence. In a chain of evidence, blockchain records every event and detail (police body cam footage, arrest data, police reporting, etc.) in sequential order with timestamps, creating a detailed timeline of events. Because the data is irrefutable, investigators and court systems can use it to piece together legitimate evidence for trial.
Authorities can also use the chain of evidence for easier detection of crimes, especially in the financial sector. If a criminal is trying to use a false identity or access unauthorized financial information, the blockchain will immediately recognize this action as malicious, alerting authorities.
Here are a couple notable examples of how blockchain is taking hold in law enforcement.
Location: San Francisco, California
Chronicled builds blockchain-based networks that feature a transparent chain of custody that allows permissible parties to view information.
Law enforcement officials can use the company’s blockchain ledger to view any suspicious activity, like drug trafficking. Additionally, Chronicled has developed tamper-proof shipping containers that register and track all contents throughout the shipping process, making it simple for law enforcement to use as evidence.
Location: London, England
Elliptic creates blockchain-based forensic investigation tools used by law enforcement, financial institutions and intelligence agencies. The company’s technology allows authorities to scan cryptocurrency exchanges for illicit relationships and transactions. Elliptic’s tools have helped law enforcement spot drug trafficking, extortion, tax evasion and even attempted terrorism.