Blockchain In The Service Of The State

Dominik Olech
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Bitcoin was made with many noble ideals. One of them was creating a currency free from any national authorities.

But now, in the times of growing popularity of cryptocurrencies, many governments see an opportunity in the technology which stays behind cryptocurrencies success.

Possible benefits of blockchain technology on the countrywide scale are various. All its advantages, which fit so well in many industries, may also be helpful in providing proper functioning of government. 

Key for the future

Governments are becoming to perceive blockchain as potentially beneficial technology rather than only a part of cryptocurrency phenomena. And even if authorities don’t know how exactly they might use its possibilities, more android mode octem, at least they try to catch up with the new trend.

For instance, the Australian government announce a roadmap for the development of national blockchain program. The strategy will focus on many aspects of integration of this technology into state structures (like proper regulations), and it will be developed in cooperation with experts from this industry. The overall goal is to make Australia a competitive player in the global blockchain industry. As Minister for Trade, Tourism and Investment Simon Birmingham said:

“It is vital Australia and our tech companies stay ahead of the game in one of the world’s fastest growing technology sectors. Austrade’s upcoming mission will connect Australian blockchain companies and start-ups with investors and customers with a view to expanding their businesses globally.”

Europe is ready for blockchain

European Union – the most significant political and economical body on the continent – also shows the growing interest in blockchain. As a result, The European Union Blockchain Observatory and Forum have been established. Its main goal is to support the active development of this technology and the free flow of knowledge and ideas. It also monitors the current blockchain projects and makes recommendations for further European suport.

Separate countries in Europe are also trying to profit from the blockchain race. Similar steps have been taken in Germany. Local Ministry for Economic Affairs and Energy and Ministry of Finance were assigned to prepare an official national strategy for the use of blockchain technology. More specific steps have been taken in the UK. Margot James, Minister for Culture, Communications and Creative Industries, informed last year that government was investing over £10 million in blockchain initiatives in areas like energy, voting systems or charity. Also, Vladimir Putin, the president of the Russian Federation, expressed an interest in this technology.

Real implementations

But those programs are still only some unspecific statements about further development. What about real ideas, with specific plans for implementations?

IBM – a global leader in the IT industry – presented some potential blockchain applications. One of the examples indicated by them concerns justiciary system and general public safety. Blockchain may be used that way to gather citizens information, providing easy access to them in the time of need with the best security measures, which allows to identify people correctly with confidence higher than ever.

Governments themselves are also aware of benefits which blockchain may bring in some specific situations. For instance, U.S. Department of Defense saw its potential in time when Hurricane Maria passed through Puerto Rico. Switching from low-efficient central management to decentralized blockchain system would improve data flow and ensure emergency services that received information is up-to-date.

At the opposite end of the world, the authorities of Mongolia announced at the beginning of 2019 a partnership with Terra. The main goal of this cooperation is to provide a mobile payment in the country, still mostly cash-based, financial system. It’s not the first Mongolian step in blockchain though – a year ago, the government allowed local telecom operator to create its own digital coin.

Willingness is not enough 

A growing number of successful blockchain implementations create a vision of endless opportunities which this technology may bring. Unfortunately, such faith without proper preparation may only lead to disaster. And one of them happened last year.

Petro, a Venezuelan cryptocurrency, was a hot topic in the crypto industry at the end of 2018. The government of this country chose a very alternative way of fighting with crisis and inflation – by creating its own, national currency, which will be covered by oil supplies. How did it end? We all know very well.

The Venezuelan case is an excellent example that blockchain itself won’t resolve the problem – it’s only a tool, which in skillful hand might create some great solutions. But misused might lead only to chaos. That’s why it is essential for governments to precede the implementation of this technology with proper research and preparations.

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