In times of gradual diminishing trusts and of the people in the system of government today, many people feel the need to find a reliable alternative to improve the system by doing anything they can. This aims to improve accountability and transparency of the working system, primarily to bring prosperity to its citizens. Some governments are aware of the technological advancement of the century. They invite some technologists to introduce their citizen to the potential usage of Blockchain. This eventually intends to support the system of delivering public goods and services.
How Blockchain Works
Blockchain, equipped with its distributed ledger feature allows the users with noncentralized networks to monitor any type of transactions that could be checked in each of its node. This technology makes it possible for us to eliminate the central points of failure, pertaining to its agility providing transparency and thus, could help propound the trust of people connected in the networks. To ensure the validity of the transaction, Blockchain provides a method of using a cryptographic key in which the users use to put their digital signature. Once it is agreed, it would proceed to be spread through the networks. Nevertheless, there is a feature that is still being developed in Blockchain that resembles a checking mechanism done in every node in order to ensure the validity and feasibility of each transaction. So, once it passes the screening would be propagated.
As a chain of blocks connected in a linear, chronological manner, Blockchain has a feature called “Hashing” that enables encryption of any inputs to be put into a fixed-length code. To group an encrypted data, they will be labelled with a specific hash code and put together in a link of blocks. This feature also provides a secure mechanism for any transactions made as it makes manipulations on the data impossible. A minor change of transactions would completely change the hash code for transaction and blocks. The features of permissionless ledgers and permissioned ledgers enable us to distinguish public and private usage. The former, adopted in Bitcoin, allows us to have an identical copy of the full ledger as well as to conduct a transaction, whereas the latter is more restricted in usage, deemed suitable to be implemented in public sector use. The strict mechanism is to ensure who can have the access upon the ledgers. It also enables us to have a sign of reliability upon the data monitoring thus, leading to better protection upon the data.
Instances where Blockchain is Used in the Public Sectors
In March 2017, there have been 117 initiatives in 26 to introduce Blockchain to the public sector. The number grows up to 202 initiatives with 45 countries participating with each of their own readiness; some are in exploration, research and strategy stage, proof-of-concept, prototyping and incubation, as well as in development or adoption. The Observatory of Public Sector Innovation (OPSI) in March 2018 recorded a plethora of Blockchain application in the public sector which could be seen in activities that deal with identity, personal records, land title registry, supply chain management, inventorying, benefits entitlements and aid, contract and vendor management, voting, and streamlining interagency processes. The implementation of Blockchain initiatives continues to be expanded by the public-private partnerships and communities of practice such as that of the US Emerging Citizen Technology Office (ECTO)'s general guidance and vision as well as its encouragement for a cooperation among different public agencies and private firms under the ID2020 initiative respectively.
In a decentralised government, people could supervise budgets and tax expenditure, so that they are well-informed to where their money is allocated. Given this capacity, people can participate deeper in a democratic governance, such as to monitor their elected officials, hence, preventing them from possessing an extraordinary power. In other words, Blockchain provides us a possibility to get the first hands-on control of a decision-making process, so that the commoners can directly have the oversight upon what is run by the central government. Blockchain could also mean a cure to the nontransparent tax collection that needs to undergo several intermediaries. By having a regulated and directed transactional system of one ledger, everyone can keep an eye on their tax payments faithfully.
National agencies of Canada, the United Kingdom, Brazil, China and India, for example, have been trying to employ the benefits of Blockchain while figuring out its potential implementations in their national public sector systems in these past three years.[i] Progressive amounts of Blockchain implementations could be seen in the US, where its state of Delaware has been experiencing a trend where companies intend to be incorporated in company registry system that adopts Blockchain since July 2017.[ii] Even more, the programs and initiatives which put Blockchain as its base have been seen formulated and commenced by the US General Services Administration, the Health and Human Services Department, and the Department of Homeland Security.
The adoption of Blockchain in voting could become the hallmarks of a new way of digital voting, implementation of which would greatly ensure eligibility and accuracy of counting as well as avoiding ballot-rigging. Such adoption could be seen in Estonia, where the government has availed themselves by using Blockchain in voting, identity management and healthcare. Meanwhile for military service members deployed overseas, Blockchain records their vote that they cast during their service abroad and ensures the immutability and native digital accessibility- such case happens in West Virginia. However, the challenge lays on the possibility for potential malware on the voter's phone that may disrupt the accountability and accuracy of the vote. Moreover, to conduct e-voting itself has been often monetised by private companies for profits. In other parts of the world, the use of blockchain for humanity purpose has been done, and it has already been enjoyed by the Syrian refugees in Jordan on how they shift their mode of payments into an electronic system that uses their biometrics. For them to get food from local merchants, they only need vouchers or electronic cards that are all used to do the Blockchain-based transaction, thanks to the help of United Nations World Food Programme’s cash transfers to these refugees.[iii]
Quo Vadis? Getting ourselves ready to adopt Blockchain in our daily public sectors
There must be several challenges that should be addressed when it comes to adopting Blockchain into our public use. Several hindrances to the adoption of Blockchain remain at our core comprehension. Technical challenges deal with the immutability of Blockchain particularly on how to remove the uploaded data, the limitation of the data storage capacity, the operational costs as it is a relatively new technology. Putting the context in the government system, Blockchain is not entirely reflecting the elimination of a central authority to command the system, as it still needs coding and governing entity. In this regard, the role of the government is to ensure that any outsourcing of the actual coding would be made reliable and authentic, which can be done by building a technical knowledge base. The remaining biggest challenge we encounter is on how we could introduce Blockchain to public officials and civil servants. The initial purpose is worthwhile nonetheless. Government executives are granted with the opportunity to even bring value to an organisation by internalising the pivotal function of Blockchain. It could be the answer to cut the budget necessary for voting, enhancing the security and audibility of votes, and if used correctly could prop up the transparency of the results. Now Blockchain looks like an impetus that sounds propitious in enhancing the quality of public sector and service. The only task that a government should do to adopt this technology into his country’s public sector is to bridge the gap in knowledge that the agencies have on what Blockchain has concerning delivering the benefits to their organisations.
Editor: Anisa Pratita Mantovani
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[i] Killmeyer, J., White, M. and Chew, B. (2018). Will blockchain transform the public sector?. [online] Deloitte Insights. Available at: https://www2.deloitte.com/insights/us/en/industry/public-sector/understanding-basics-of-blockchain-in-government.html [Accessed 9 Dec. 2018].
[ii] JOHN ROBERTS, J. (2017). Companies Can Put Shareholders on a Blockchain Starting Today. [online] Fortune. Available at: http://fortune.com/2017/08/01/blockchain-shareholders-law/ [Accessed 9 Dec. 2018].
[iii] Wfp.org. (2018). Blockchain Against Hunger: Harnessing Technology In Support Of Syrian Refugees. [online] Available at: https://www.wfp.org/news/news-release/blockchain-against-hunger-harnessing-technology-support-syrian-refugees [Accessed 9 Dec. 2018].