Blockchain Revolution

Security. Everyone must have equal protection of the law without discrimination.

No arbitrary detentions or arrests. No one person or group of people should live in fear of their own government or law enforcement agencies or be subjected to cruel, inhumane, or degrading treatment from members of those agencies because of their race, religion, or country of origin. Members of police forces can’t withhold evidence of undue use of force, and evidence can’t go missing. It would all be logged and tracked on the blockchain.

Inclusion. Using the Internet, citizens became more involved, learned from one another. With the blockchain, the system can cost-effectively engage all citizens, recognize everyone as a person before the law, and provide equal access to public services (e.g., health care, education) and social security.

Technology is a powerful tool but it alone cannot achieve the change we need. In the spirit of the saying “The future is not something to be predicted, it’s something to be achieved,” let’s reinvent government for a new era of legitimacy and trust. It’s time to stop the tinkering.

HIGH-PERFORMANCE GOVERNMENT SERVICES AND OPERATIONS

The critics of “big government” are right in one sense. When it comes to efficiency, government services and operations have a long way to go. Governments are organized into silos that don’t share information. Bureaucracy too often trumps common sense or shared practices. Citizens rarely have one-stop shopping for government services. Every country has countless tales of politicians and bureaucrats squandering taxpayer dollars.

Blockchain can improve client service, increase efficiency, and improve outcomes while enabling both integrity and transparency of government. The potential to improve all facets of government is significant, but some are especially important in the developing world, where governments are establishing new processes and can leapfrog the systems of long, stable, and open governments.

Let’s look at two broad areas where we can apply the blockchain: integrated government and the public sector use of the Internet of Things.

Integrated Government

Estonia is cutting administrative inefficiencies and providing integrated services to its residents and businesses by creating an electronic ID card for everyone and using a blockchain-enabled Internet backbone known as the “X-road” to connect across multiple programs and databases in both public and private sectors. Others can do it, too.

Many countries such as Canada, the United Kingdom, and Australia have explicitly rejected the concept of a central population registry and single government ID as a matter of public policy. This decision stems from a concern for personal privacy and an aversion to expanding state power, especially in granting or revoking identities.

However, as Estonia shows, if we hash official documents (passport, birth certificate, marriage license, death certificate, driver’s license, health card, land titles, voter ID, business registration, status of tax payments, employment number, school transcripts, etc.) that currently exist in multiple databases into a single blockchain, blockchain-enabled networks could deliver integrated services without going through any central processing. Not only could this model protect privacy, it could enhance it by allowing people to verify the accuracy of their information, and to see who accessed or added to that information (i.e., a permanent information audit).

In fact, in the future it makes sense that each citizen owns her identity information rather than a government. As we explained in chapter 1, just as networks and mass collaboration can eliminate the need for a government to issue currency or for a bank to establish trust, people won’t necessarily even need a government-issued identity card. Said Carlos Moreira of the cryptographic security company WISeKey, “Today you need an organization with endowed rights to provide you with an identity, like a bank card, a frequent flier card, or a credit card. But that identity is now yours and the data that comes from its interaction in the world is owned by someone else.”¹⁹ On the blockchain, the individual owns the identity. Your “personal avatar” could decide what information is provided to whom under your command. It could also make choices about integrating data. However, rather than everything you do with government being integrated in some massive government database, the integration is achieved by the virtual you—owned and controlled by you.

Better integration would support life events such as marriage. Melanie Swan, founder of the Institute for Blockchain Studies, explained: “The blockchain—with its structure that accommodates secure identities, multiple contracts, and asset management—makes it ideal for situations such as marriage because it means a couple can tie their wedding contract to a shared savings account, and to a childcare contract, land deed, and any other relevant documents for a secure future together.”²⁰ Some have suggested that the blockchain could become a public documents registry outside any government sanction or involvement. The world’s first blockchain- recorded wedding took place at Walt Disney World, Florida, in August 2014. Smart prenuptial contracts, anybody?

Beyond integrated services, governments could register and manage documents with transparency and reliability. Consider the staff time spent in issuing, verifying, updating, renewing, and replacing people’s official government records. In addition to ensuring document veracity, blockchain-enabled registration through peer-to-peer networks would support self-service, where people verify a document through the network, not through a registrar, as well as personalized service—when you generate an official document, it automatically contains your relevant information and access

rights to that information, and tracks who accesses and uses it in the document metadata.

For example, the U.K. government is investigating the use of the blockchain in maintaining numerous records, especially for ensuring their integrity. Paul Downey, a technical architect with the U.K. Government Digital Service, noted that the perfect register “should be able to prove the data hasn’t been tampered with” and should store a history of the changes that have been made, plus “be open to independent scrutiny.”²¹

Blockchain-based systems can infuse efficiency and integrity into document registries of all kinds and many other government processes. Let’s combine supply chain management with the Internet of Things to tag a new piece of equipment with a smart chip that communicates its provenance, ownership, warranties, or special information. Government procurement offices could track items and automate processes at every step: purchasing, releasing payment, paying sales taxes, renewing a lease, or ordering an upgrade. That’s simply better asset management, reducing administrative costs to taxpayers while increasing revenues to governments.²²