Unlocking blockchain for government

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Connecting state and local government leaders

By Sara Friedman

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Using blockchain technology through permissioned networks can help state governments improve the delivery of their services, a new report finds.

What: A brief providing a roadmap to utilize blockchain technology for state government data, “Blockchains: Moving Digital Government Forward in the States” from the National Association of State CIOs

Why: As blockchain uses continue to evolve, state governments can start taking advantage of the technology to improve their services and supply chains through pilot programs. With more test cases, states will learn how blockchain helps with decision making and will create best practices.

Findings: While blockchain technology creates a shared, global ledger of transactions that can be used to secure virtually any data -- from birth certificates and academic records to property deeds, criminal records and even transactions in the energy sector -- NASCIO suggests that states should focus their early efforts on permissioned networks where only a small, restricted set of users have the rights to validate transactions.  Since permissioned blockchains reduce the size of the network to only known participants, scalability also becomes easier over time. 

The Illinois Blockchain Initiative is an early adopter in bringing together state and county agencies to review how blockchain and distributed-ledger technology can be used to transform the delivery of public and private services.  Through five test cases, the group is working to modernize governance in a distributed economy, develop an ecosystem for long-term growth and collaboration and integrate services for a more efficient government.

To determine how blockchain can fit into government transactions, NASCIO recommends states follow  six steps:

  1. Begin research of blockchain technology and economics now to grow knowledge.
  2. Explore potential use cases to get a better understanding of how blockchains may disrupt or enable the organization.
  3. Consider developing a preliminary strategy on how to adopt blockchain technology for future use.
  4. Create a state stakeholder group with individuals from both the business and technology sectors to inform the preliminary strategy.
  5. Identify relevant use cases that harvest the benefits of blockchain technology.
  6. Develop or join a collaborative with other organizations to explore blockchain opportunities and share knowledge and experience regarding cost reduction and innovation.

Read the full report here.

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