Blockchain in

Government and

the Public Sector

What are the Benefits of Blockchain in Government and the Public Sector?

A blockchain-based digital government can protect data, streamline processes, and reduce fraud, waste, and abuse while simultaneously increasing trust and accountability. On a blockchain-based government model, individuals, businesses, and governments share resources over a distributed ledger secured using cryptography. This structure eliminates a single point of failure and inherently protects sensitive citizen and government data.

A blockchain-based government has the potential to solve legacy pain points and enable the following advantages:

• Secure storage of government, citizen, and business data
• Reduction of labor-intensive processes 
• Reduction of excessive costs associated with managing accountability
• Reduced potential for corruption and abuse
• Increased trust in government and online civil systems

 

Enterprise Blockchain Solutions for Government

An Enterprise Ethereum Solution for Government

Using our full stack of enterprise tools, ConsenSys is building the blockchain operating system for public sector organizations. Our government enterprise solution utilizes OpenLaw smart contracts, Treum asset management solution, the uPort identity management solution, and process automation from Pantheon and Kaleido. 

Our solution provides a private, enterprise chain developed specifically for government. It features the ability to assign different levels of access to authorized users, ensuring independent validation of transactions and operations that establish full security and accountability while complying with relevant privacy standards. 

Our solution enables citizens, residents, and businesses to participate and manage their data, creating a secure system that will streamline government-citizen interaction, while securing information against hacking and fraud.

The ConsenSys Government Stack

On top of our secure blockchain architecture, ConsenSys is building out a core set of functional elements that will allow for an initial set of typical government functions.

• Identity Management: Sotara will enable government workers and citizens to register their identities on the blockchain, manage assets and security, send and request credentials, authorize transactions, and securely manage data
• Smart Regulation: Sotara will allow agencies to design and create legal documents and regulations with tamper-proof blockchain-based smart contracts
• Asset Management and Process Tracking: Sotara will model and facilitate government processes and increase the ability to track digital and physical assets
• Budgeting and Financial Management: Sotara will track and reconcile government transactions immediately and transparently dramatically reducing costs and increasing efficiency.

The interoperability of the platform will allow for additional applications as more public sector functions transition to blockchain-based solutions.

What are the Blockchain Use Cases in Government and the Public Sector?

• Smart Cities
• Central Banking
• Validation of Education and Professional Qualifications
• Tracking Vaccinations
• Tracking Loans and Student Grants
• Payroll Tax Collection

 

How will blockchain impact smart cities?

A smart city uses information technology and data to integrate and manage physical, social, and business infrastructures to streamline services to its inhabitants while ensuring efficient and optimal utilization of available resources. In combination with technologies, IoT, cloud computing, and blockchain technology, governments can deliver innovative services and solutions to the citizens and local municipalities. 

Blockchain can provide the mechanism to create a secure infrastructure to manage these functions. Specifically, it can provide a secure interoperable infrastructure that allows all smart city services and functions to operate beyond currently envisioned levels. ConsenSys has worked toward realizing smart city initiatives in Dubai and Zug.

How will blockchain impact central banking?

Real-time gross settlement is the continuous process of settling interbank payments in central bank records as opposed to settlement at the end of each day. Blockchain enables a significant increase in transaction volume and network resilience which enables central banks to process RTGS at a faster pace, with heightened security. 

How will blockchain streamline the validation of educational and professional qualifications?

Keeping academic and professional attainment data on an encrypted identity wallet empowers individuals to control access to their data. It also enables schools, universities, and employers to validate “attestations” for courses and work achieved. 

How will blockchain technology impact vaccination tracking?

Recording vaccination data on the blockchain enables schools, insurance, and medical providers to validate vaccinations quickly. This process automatically triggers corresponding micropayments and delegates access to benefits based on medical status.

How will blockchain technology manage tracking student loans and grants?

Smart contracts can be programmed to manage loan and grant applications, dispense loans, and track compliance with the terms and conditions. This automated performance tracking enables real-time data and increased transparency, compliance, and security.

How will blockchain technology impact the collection of payroll tax?

Smart contracts can streamline the tax collection process by matching tax data with income transactions and calculating tax and social security deductions. A blockchain-based system automatically transfers net salary and tax payments to their respective recipients. Coordinated automation brings efficiency, speed, and security to tax collection.

How are Governments Using Blockchain?

With increasing public pressure for improved performance, transparency, and accountability, as well as reduced costs, many governments are testing blockchain solutions on some of their most vexing perpetual challenges. Blockchain technology has enormous potential to modernize the government and the public sector. 

 

How are governments using blockchain in the United States? 

The U.S. Federal Government has launched numerous initiatives to explore the potential of blockchain.

• The U.S. Treasury piloted the use of blockchain in tracking and managing government equipment
• The 2018 National Defense Authorization Act (NDAA) has required that blockchain be assessed for military employment
• The U.S. Air Force is exploring a cloud-based, blockchain-as-a-service platform to improve its logistics and supply chain capabilities
• The Department of Homeland Security issued small grants to explore the uses of blockchain in identity management
• The Naval Air Systems Command is investigating the effectiveness of blockchain in tracing aviation parts through their life-cycle
• The U.S. Department of Health and Human Services (HHS) is using blockchain, machine learning, and AI to streamline acquisition
• The Food and Drug Administration’s Office of Translation is exploring the utility of blockchain in the secure sharing of information between the FDA, health care providers, and hospitals
• Delaware is using blockchain to streamline a new business registry. The Uniform Commercial Code (UCC) blockchain automates the release and renewal of UCC filings and associated collateral. The result includes increased search speeds, reduced manual errors, and lower associated costs. UCC filings are liable to become a critical tool for credit risk management.
• Arizona establishes legitimate guidelines for using blockchain for government records. Arizona has classified a signature, record, or contract secured through blockchain technology as an electronic form of consent in proper legal standing. This denotation can be used to enforce rights of ownership, asset sales, documents of title and more.

 

How are governments using blockchain in the European Union? 

• EU Blockchain Observatory & Forum. The European Union as a whole has led the charge in researching potential blockchain applications to spur digital innovation. View the EU Blockchain Observatory & Forum Initiative Map. 
• The municipality of Zug, Switzerland granted a digital, decentralized, sovereign identity to their citizens. Residents can verify their identity, cast votes, and access government services from the comfort of their homes.
• Her Majesty’s Land Registry set up a digital asset management platform to explore the potential of blockchain technology in the UK real estate industry.
• The Republic of Georgia launched the first-ever blockchain land-registry system with a goal of strengthening property owners’ rights, enhancing citizens’ trust in government, and reinforcing data security. There are now more than 1.5 million land titles registered, with an average of 3 minute registration time. 
• In July 2018, the UK’s Food Standards Agency (FSA) completed a pilot using blockchain to track the distribution of meat in a cattle slaughterhouse. This trial marked the first time that distributed ledger technology had been used as a regulatory tool to ensure compliance in the food sector.
• The Netherlands Enterprise Agency (RVO) devised the SBIR competition with the aim of using blockchain technology to resolve issues connected with government services, energy and healthcare in the Municipality of Zuidhorn.
• The City of Groningen, the Netherlands created a POC to help people regain financial control over their debts through a variety of services including debt assistance, debt prevention, income management, and social lending.
• In October 2015, Ukraine’s Ministry of Finance began working on a next-generation of decentralized, blockchain E-auction system to support non-corrupt, transparent privatization processes of state and regional property, land, and enterprises. 
• The Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH established a ‘Blockchain Lab’ in February 2018. The aim of the lab’s work is to leverage the potential of blockchain and related technologies for the purpose of implementing the 2030 Agenda for Sustainable Development.
• Blockchain Isle of Man, United Kingdom launched sandbox-development systems designed to help firms overcome emerging regulatory hurdles.
• The Ministry of Economy launched a government-supported initiative aimed at promoting the adoption of blockchain technology in Spain.
• The City Council of Valls is expected to launch the Open Data Portal which simultaneously publishes data sets and resources in the local municipal web portal and on a distributed network based on IPFS.
• One of Spain’s busiest ports in Valencia utilized blockchain and big data to create a paperless “smart port.”
• Associated British Ports (ABP), the largest port operator in the United Kingdom, is testing the use of blockchain to facilitate trade through its marine terminals.
• The ministry of Energy, Tourism, and Digital Agenda co-financed project TrustForWills which facilitates the will of users of digital services in Madrid, Spain.
• The European Horizon 2020 program invests up to €300 million in projects supporting the use of blockchain in a number of sectors.

 

How are governments using blockchain in Africa, the Middle East, and South Asia?

• His Highness Sheikh Mohammad bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai leverages blockchain, AI, and IoT technology in attempts to make Dubai the happiest city on earth.
• In March 2017, the Kenyan government issued retail bond M-Akiba via a mobile phone platform, leveraging blockchain and smart contracts manage a high volume of accounts with small payments. 
• In July 2019, Nigeria’s road transport union launched a blockchain-based passenger manifest system (PAM).
• Kenya is launching a network of blockchain-based community currencies aimed at combating poverty
• South Korea’s Customs service launched a blockchain-based clearing system for import and export shipping management. 
• The South Korean Government is investing in six separate blockchain pilots with a $9 million fund.
• The State Railway of Thailand and Thailand Post will reportedly develop and apply Internet of Things (IoT) technology to track train arrivals and departures and blockchain technology to track high-value parcels. 

 

How are governments using blockchain in Australia? 

• Commonwealth Bank of Australia issued a cryptobond for Queensland Treasury Corporation using its capital markets blockchain platform.
• Two Australian senators launched a bipartisan group intended to champion the use of blockchain technology within both government and private industry.
• In 2017, the University of Melbourne became the first university in the Asia-Pacific region to issue recipient-owned credentials on the blockchain.

Enterprise Ethereum is the foundation for many industry blockchain use cases and case studies. Find out more about blockchain applications in banking and finance, digital identity, energy, healthcare, law, real estate, sports and supply chain management.  And read our other case studies:

• Project i2i: Driving financial inclusion in the Philippines
• komgo: Bringing commodity trade finance into the 21st century
• Project Ubin: Exploring the potential of distributed ledger technology in central banking
• Project Khokha: Pushing the limited of interbank payment settlement with blockchain
• Zug: Introducing civil identity on the blockchain
• Smart Dubai: Forging a seamless city experience in the UAE
• EU Blockchain Observatory and Forum: Accelerating blockchain innovation in Europe
• August Debouzy: Introducing joint security token offering services
• Project Unblocked Cash: Revolutionizing humanitarian cash transfers in Vanuatu