When it comes to government processes, the first term that comes to anyone’s mind is red tape, inefficient workflow, redundancy, lack of transparency, untouched by digitalization, and zero privacy. Using blockchain in government processes can give a one-answer solution to all these problems.
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Why Should Government Think About Using Blockchain?
According to the Global Blockchain Survey of Deloitte, 73% of the respondents shared that their entity will lose its competitive advantage if they are resistant to digital assets and blockchain solutions. Doesn’t that apply to governments too?
Blockchain In Government Processes Leads To Global Digitalization
According to ECA Economic Update Spring 2021, only 19 out of 50 countries have reached the highest GovTech Index in all critical areas like citizen engagement, public service delivery, core operations, and enablers. Blockchain stands as the turning point for the long-awaited digital transformation.
Blockchain allows continuous management, data transparency, and immutability of information. Thus, the usage of blockchain in government processes would reduce centralized authority and thereby reduce corruption.
Reduction In Data Leakage
Hacking is inevitable no matter what technology you use. Every second, around 68 records get stolen or lost around the world. By 2025, cybercrime will amount to $10.5 trillion worldwide, according to Cybersecurity Ventures. Blockchain is not a solution to hacking and data leakage. But, its transparency and immutability feature help to secure identity management, regulatory compliance, and contract management. Thus, there is a reduction in data leak risk with the usage of blockchain in government processes.
Governments and citizens can reduce numerous redundant processes and increase the speed and efficiency of service delivery with blockchain-empowered solutions. It will be easier to distribute records, verify documents, and more. Blockchain can help in improving visibility, accountability, and trust.
When we reduce data leakage, corruption, time taken, and redundancy, we minimize the waste of resources and time. Thus, we can save tax money by cutting several unwanted steps and intermediaries.
However, many governments still rely on centralized legacy systems that are expensive, inefficient, and unsafe. If you are still assuming that blockchain in government processes is a theoretical discussion, here are some blockchain use cases from around the world.
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Blockchain Use Cases From Around The Globe
United States Of America
The Health and Human Services department of America runs the first blockchain-based program called Accelerate Program. The Accelerate network performs cluster analysis of decades of HHS contracts to identify price discrepancies. In 2020, based on this report, the department negotiated a deal that would, in total, save $30 million in the next five years. The new price was less than half of what the department paid before Accelerate’s analysis report. The program helps the staff learn the suppliers’ interaction, financial records with time stamps, price discrepancies, and information about past contracts.
There are successful examples of blockchain in government processes like voting registration, border patrol, customs, budgeting, data entry, interagency data management, and more. The country is also aiming to reduce paper-based legacy systems and focus on storing data on the blockchain, like marriage licenses, government licenses, arrest records, and more.
The country uses blockchain for around 140 government services in electronic certification and storage, business collaboration processing, and data sharing & exchange. You can also find blockchain use cases in the real estate industry for creating a registration system collaborating with several departments. Based on this registration system, the departments can also offer electronic licenses. Such licenses will provide better traceability and data sharing. China also introduced a 15-year blueprint for global technology development, including blockchain.
Blockchain uses cases in the telecom industry are also notable. The blockchain is crucial in creating collaboration with multiple devices, secure interaction, and more. Blockchain with 5G will help in better usage tracking and resource sharing. Currently, China Telecom is experimenting with blockchain technologies to create better international roaming services and eliminate third parties.
India has started experimenting with blockchain technologies for land title registers. This initiative aims to reduce corruption and improve transparency. The National Informatics Centre has created a blockchain ecosystem to coordinate and interconnect several government processes. Thus, the government can test-run the projects in these interfaces before rolling them out to the public. The government also has plans to adopt blockchain technologies for several e-governance purposes.
Several banks have started participating in metaverse banking, where virtual client interactions can be simulated. Under this, banks can also insure and lend against the virtual currency, virtual real estate, and non-fungible tokens. 12 Indian banks have started IBBIC to eliminate paperwork, reduce processing time, and improve security with blockchain technologies. The Tea Board of India plans to use blockchain technology to enhance its supply chain. Other uses of blockchain in government processes are secured voting process, SEBI record-keeping, educational certificate recording & distribution, and more.
The United Arab Emirates
In 2020, the Ministry of Health and Prevention joined Dubai’s Ministry of Presidential Affairs and other ministries to launch a medical platform powered by blockchain. This platform stores and records healthcare data.
ADCB (Abu Dhabi Commercial Bank) created a finance platform to create end-to-end transparency in any transaction. One can view the entire transaction history with digitalized documents at any stage. Now, ADCB is the first bank in UAE to execute automated blockchain trade transactions end-to-end.
Other blockchain use cases in UAE are
- Dubai Customs uses a blockchain-empowered eCommerce platform.
- The immigration and Visa department of Dubai uses a combination of blockchain and biometric authentication to create digital passports.
- The Department of Economic Development of Dubai is creating a blockchain registry to share info about the free zone and mainland companies and their structures.
The government uses KSI Blockchain to store and record historical and government records. Thus, it is impossible to rewrite any document to avoid punishment or interfere with the system. Beyond this, the government also offers blockchain-based solutions in healthcare, education, mobile services, residency, e-identity, and more.
Sweden has started using blockchain in government processes like land title registration. Sweden focuses on improving the efficiency of the process using blockchain technology.
Malta’s government plans to transform it into a blockchain island, and since the announcement, Malta has witnessed 60 billion Euros in crypto pass through their country for transactions. Among the multiple government projects, MEDE – the education and employment ministry, has started the Blockcerts platform, where educational institutions can verify, create, and distribute certificates, diplomas, and other academic documents to the citizens. It also initiated the digitalization and registration of official papers of industrial property rights in a digital network.
Under a Gozo project, all the products made in this region will be digitally labeled during production. Thus, when a customer scans the QR code, they can receive a confirmation of whether the product was made in the region. There is also another project that is in implementation to improve the planning authority’s strength via DLT.
In 2017, the nation used the Ethereum blockchain in government processes. It tested the digital identity issuance in Zug, the crypto valley. The users will interact with the system through the uPort application. After a physical application and verification at the city hall, the citizen’s identity will be registered in the Ethereum blockchain. Then the user can use the application to provide identifying information for verification. The government also uses blockchain-based digital ID in voting and other municipal services.
The government is currently building the ICON platform. This platform links businesses in several sectors like banking, government services, healthcare, and others with online communities. You can find blockchain use cases for identity authentication and management (Zzeung), digital certification and management (BROOF), and visitor check-in and management (VisitMe). South Korean Shinhan Bank is using Zzeung for KYC blockchain-based financial authentication process.
The country is also planning to use blockchain-based intelligence information technology for voting and ballot counting. In addition, blockchain use cases can be seen in areas like education, insurance, and others.
Australia created a blockchain-based trading platform for energy. This platform allows buying/selling renewable energy. The platform is now used in multiple countries like India, Japan, Thailand, the USA, and others.
Argentina is working on using blockchain in account debit claim traceability. It plans to create a PoC-based solution connecting financial agents, banks, clearing houses, and others. After practical testing, more banks will be joining the network. ENARGAS, the nation’s gas regulator, uses a blockchain-based smart contract certification platform that increases the efficiency and speed of the gas certification process.
The Hurdles In Using Blockchain In Government Processes
The first hurdle is that many people are still learning about this technology. Beyond this stigma, there are scalability issues and ever-changing regulations by governments. Developers are using Layer 2 solutions to overcome scalability issues, and the government can join hands to create a sturdy and unified regulation.
The main advantages of using blockchain in government processes are transparency, efficiency, convenience, security, and cost-effectiveness. Blockchain helps create a better government and improve citizens’ experience in utilizing government services.