A blockchain primer gives agencies a foundational understanding of the distributed ledger technology.
As more government agencies investigate the potential for blockchain technology, ACT-IAC has put together a primer, Enabling Blockchain Innovation in the U.S. Federal Government.
Including thought leaders from government and industry, ACT-IAC’s Blockchain Working Group was created in May at the request of the General Services Administration. Jose Arrieta, director of the Office of IT Schedule Contract Operations at GSA, and Todd Hager, vice president of strategy innovation and quality at Macro Solutions, discussed GSA’s blockchain progress at a recent ACT-IAC forum on the technology.
“With Jose Arrieta's challenge put before us to craft a government blockchain playbook, our group set out to create a blockchain primer, the first step in helping agencies to build the foundational understanding,” Hager told GCN via email. “Now that the primer is published, we have begun work on the blockchain playbook, which will help agencies to explore blockchain-appropriate use cases and provide guidance on building an agency-specific implementation strategy.
With the complicated and evolving state of blockchain technology, the working group determined the best course of action is for government to work with industry to develop a common set of standards and frameworks to “facilitate innovation, interoperability and trust” without overshadowing other important policy objectives, including risk mitigation, consumer and investor protection, resiliency and transparency.
Blockchain has potential to increase public trust and citizen engagement through identity management and transaction validation. Some of the use cases for blockchain involve citizen services, identity management, contracts management, benefits management, regulatory compliance and disaster recovery.
However, the primer does acknowledge the confusion around how blockchain technology works and what is needed for it to succeed in the government space.
According to the report, when government agencies are considering blockchain for business processes, they should ask the following questions:
- Is there a need to provide trust more efficiently when conducting transactions in a business network?
- Are there any current disputes or discrepancies among participants caused by invalid or incomplete data stored on existing systems of record?
- Are there requirements to track the lifetime history of a part, record or asset?
- Are there existing cross-organizational business processes that are manual or paper-based?
- Can this use case be implemented with a different type of technology that is more mature?
The primer identified ”suspicion” around cryptocurrencies like bitcoin as creating a “misplaced sense of fear” around blockchain. Another challenge involved the “confusing combination of terminology and technologies” that makes blockchain difficult to understand.
With the multiple implementations and technologies, agencies must identify the solution that works best for their needs. The primer also acknowledged that blockchain may not be the right solution for some government processes.
Since blockchain in government is only in the nascent stages of development, the primer posited that there could be room for government officials to experiment with the technology as well. As financial services technology as evolved, a whole new industry sprang up to address regulatory services associated with streamlining back-office systems management for regulatory compliance and risk management.
Similarly, blockchain has the ability to create “regulatory technology” that can serve as “policy-making, oversight and enforcement mechanism” by combining the oversight duties of government agencies and the compliance and risk management responsibilities of industry.
To help agencies move forward with development, the Blockchain Working Group is drafting a playbook that will help outline the steps and technology required to tailor agency-specific plans. The playbook is expected in the spring of 2018.
Editor's note: This article was changed Oct. 23 to correct Todd Hager's title.
NEXT STORY: Attackers hijack state agency server for malware