federal blockchain


How blockchain can transform the public sector

One of government's most important functions is managing its citizens' most personal and private information -- everything from birth certificates, to real estate transactions to educational records to wills and more.  Keeping this data safe is vitally important, and blockchain is poised to help government  manage data more effectively, quickly and securely.

Blockchain technology is making headlines due to its potential impact across industries. For the unfamiliar, blockchain is an online, real-time ledger of anything that can be recorded (financial transactions, contracts, assets, supply-chain information, etc.). No one person oversees the entire chain; everyone can see the detail of each record or ‘block,’ and the only person who can edit a block is the one who ‘owns it’ and has a private key. This technology offers a robust approach to data security and reducing transaction costs, which are just some of the reasons the global blockchain market is expected to surpass $20 billion by 2024.

In the near future, blockchain is likely to affect several critical public-sector functions:  

Securing data.  Any entity handling large amounts of personal information is at huge risk for cyberattack -- as the Office of Personnel Management discovered in 2015 when hackers stole Social Security numbers, fingerprints and employment history for more than 20 million Americans. Blockchain encryption isn’t 100 percent foolproof, but it creates significant software obstacles to hackers.

The Illinois Blockchain Initiative aims to protect citizen's personal information using the concept of  a “self-sovereign identity,” one that begins at birth and remains entirely under an individual’s control. The state will establish a digital identity ledger upon someone’s birth that will include verifiable claims, such as blood type or date of birth. The identity can only be accessed via explicit consent of the identity holder or his or her legal guardian, and it can be efficiently and securely validated by entities that require it without relying on a centralized information system.

Voting. Because of the transparency of blockchain technology, officials hope it can help prevent election fraud. Boston-based blockchain startup Voatz aims incorporate a secure, immutable blockchain into the voting process, enabling tamper-proof record-keeping and identity verification. The application also works with mobile technology and tablets, providing voting access to rural areas and immobile citizens. Voatz has already been incorporated into pilot programs including more than 70,000 voters in elections and voting-related events in multiple jurisdictions.  It is working with counties  in West Virginia to allow service members to cast absentee ballots through a blockchain-based mobile app during the state’s primary elections.  It  is next set to test its technology during town-meeting voting in Massachusetts.

Streamlining administrative processes.  Blockchain can simplify government administrative processes by removing intermediaries. Currently, a bank or another third-party acts as a trust agent  between two parties in a contract. With blockchain, however, the two parties can share data safely and quickly, with the ability to see edits or additions. For example, homeowners could use blockchain to facilitate a real-estate transaction, with all relevant information being recorded and approved by both the buyer and seller. If the real estate company and other relevant parties are given ledger access, approval time and the paper trail will greatly decrease.

Smart incorporation. Delaware officials are eliminating paper-based processes by using blockchain and smart contracts for business incorporation. A digital approach will benefit companies with complicated equity structures, as rules for investment can be outlined on the blockchain via embedded smart contracts. Blockchain can also be used to automate corporate voting procedures and help ensure compliance with investment rules.

Many government agencies are taking their cues on blockchain from commercial industries, such as banking, education, manufacturing and retail. In response, leading technology companies are introducing blockchain into their government solutions, helping to meet the demand for secure, transparent and efficient transactions.

About the Author

Franco Amalfi is director of innovation for Oracle Public Sector North America.


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