Issue link: https://maltatoday.uberflip.com/i/946236
maltatoday, SUNDAY 25 FEBRUARY 2018 XII Business & Finance Blockchain: the potential to improve public services Much can be written about blockchain, the theory behind it, related technolo- gies, its uses and implications. This article serves as a quick primer on blockchain and its potential to improve the delivery of public services. Blockchain is a decentralised distrib- uted ledger technology that allows the creation and validation of transactions between computers on a network. Each transaction has a timestamp and unique cryptographic signature, which makes it secure and immutable. Transactions need not necessarily be financial, but may constitute any exchange of digital assets. The recording of these transactions lends this technology the nature of a ledger, while it is distributed because there is no central third-party authority, such as a Government, bank or other institution, that acts as a mediator or agent in these transactions. It is the par- ticipants in the network who are the only parties to the transactions, who decide on the rules governing these transac- tions, and who have and update copies of the data. No data is ever deleted, making it au- ditable and transparent. The term Block- chain arises from the fact that groups of transactions form blocks of data that are linked, as in a chain, to other blocks of data. It provides record-keeping function- ality, without a centralised architecture. Although blockchain technology is based upon transactions, it is not a replacement for traditional databases or transaction processing. In many conversations related to blockchain, Bitcoin is normally also mentioned. Bitcoin is a cryptocurrency based upon blockchain technology. It is pertinent to note that it is only one of a multitude of cryptocurrencies that cur- rently exist. It is beyond the scope of this article to discuss cryptocurrencies, but Bitcoin, or cryptocurrencies in general, do not define blockchain. The nature of blockchain makes it easier for these cryptocurrencies to come into being and to evolve. The lack of an intermediary also increases the desirability of crypto- currencies since transactions tend to be faster and cheaper because the model cuts out any middleman. Therefore, one may look at blockchain technology as a notarisation service that validates the exact time at which an action or event took place. This may be a birth or death, the exchange of a prop- erty title, the acquisition of a qualification or nearly anything else where a times- tamp is critical as proof of the event. Globally, governments are making use of this technology to better their public services. One such area is the streamlin- ing of approvals from multiple authorities. Many life events require citizens to gain any number of approvals, which normally require physical visits to the correspond- ing number of government offices in order to complete the process. Block- chain makes these approvals possible in a decentralised manner. The power and convenience of this is multiplied when the players are dis- persed geographically, possibly in differ- ent countries. Smart contracts seem to provide sub- stantial tangible benefits in being secure and transparent. This would be true especially for contracts relating to public procurement, but also for all contracts where public services to citizens and business are concerned. Other applica- tions include land registry, a Blockchain Exchange as a subsidiary of the stock exchange, enrolling of students into schools, property acquisition and others. Tracking the migration of people around the world and reliably accessing their details could be greatly facilitated through the use of blockchain by mitigat- ing the risk of forgery and misidentifica- tion. This is also relevant wherever reli- able identification is necessary, as in the case of all personalised services, which are increasingly being provided by public services. These include tax collection, social benefits, all government records, even possibly electronic voting. Locally, there are various government ministries and public entities that are tak- ing the initiative of implementing projects based upon blockchain technology. In support of this, the Malta Information Technology Agency (MITA) has been made responsible for implementing a Blockchain Hub as well as a National Blockchain Laboratory. The Blockchain Hub shall provide a mechanism to support start-ups in imple- menting solutions based on Blockchain. The government shall be capitalising on MITA's existing expertise and experience in this area following the establishment and successful operation of its own MITA Innovation Hub (MIH) that provides sup- port to technology start-ups. The MIH's business model may easily be reused for the Blockchain Hub. The National Block- chain Laboratory is intended to provide a physical or virtual space where public officers may learn about Blockchain technologies. This facility may in future also be made available to Government suppliers and start-ups. The fundamental prerequisite for all this to happen is trust. It is essential that the members of any blockchain network trust each other since there is no central con- troller or arbiter to set the rules or settle disputes. However, it is a characteristic of the blockchain model itself to encour- age this trust because of the promise of transparency and accountability. This is the potential that blockchain presents in improving our public services. Many life events require citizens to gain any number of approvals, which normally require physical visits to the corresponding number of government offices in order to complete the process. Blockchain makes these approvals possible in a decentralised manner Mark Bartolo MITA Enterprise Architect – ICT Policy within the Strategy and Business Department OPINION