What countries are leading the way in blockchain innovation?
Blockchain projects are kick-starting around the nation. Through our research for Scottish Government, we have documented some of these to give a glimpse of the scope of blockchain's application in public sector.
These initiatives are recent, and in most cases start with research then proceed to action via practical “proof of concept” projects, typically in co-operation with local commercial enterprises who are concerned with developing their own solutions. In some cases, the initiatives seek to support inward investment by running challenges and competitions to attract funded international start-ups.
In 2018 many of these projects are moving into pilot phase.
Since 2016, the Dutch Public Service has delivered eleven blockchain pilots focusing on processes and services it wanted to modernise in different government organisations, positioning the Netherlands as one of the leading countries in blockchain innovation. You can see a list of the Netherlands' blockchain initatives in our previous blog.
The US government have been evaluating blockchain via several US government agencies to improve transparency, efficiency and trust in information sharing in:
- Financial management
- IT asset and supply chain management
- Smart contracts
- Patents, Trademarks Copyrights, Royalties
- Government-issued credentials like visas, passports, SSN and birth certificates
- Federal personnel workforce data
- Appropriated funds
- Federal assistance and foreign aid delivery
Dubai and Malta
In 2016 Dubai set a city blockchain strategy to "deliver more seamless, safe, efficient, and impactful public services". It set the goal of eliminating bureaucracy by replacing 100 million documents with natively digital transactions, underpinned by distributed ledgers, by 2021.
Dr Aisha Bin Bishr discussed Dubai's 20 planned blockchain pilots, spanning applications across permits & licenses, transportation, energy, health and education. This strategy is a co-ordinated cross-government multi-agency effort with defined results and deadlines.
"Adopting Blockchain technology Dubai stands to unlock [£1 billion] in savings annually in document processing alone"
Dr Aisha Bin Bishr, Smart Dubai
One example is the Dubai Land Department which is building a real estate register system to record transactions with improved transparency, timestamping and credibility in a city state which is a hotspot of foreign inbound property investment. Currently in pilot, the project will deliver in 2019 and involves a broad ecosystem including real estate companies, IKEA and and Emirates Bank.
Dubai’s hope is to establish itself as a destination for the most innovative start-ups to help diversify away from oil revenues. It sees blockchain start-ups as attracting the best talent and investment.
At the UNLOCK Blockchain event, the city energy utility DEWA issued a challenge to the start-up companies present around a blockchain platform for Electric Vehicle registration, charging and billing. Later in 2018 it will repeat the Smart Dubai Office Blockchain Challenge – targeting international start-ups under three years old. Its goal is to drive solutions for government efficiency, thought leadership, and to support creation of a blockchain industry in Dubai.
Malta was represented by Dr Abdalla Kablan who explained that Maltese government attention had focussed on the role of cryptocurrency in its position as Europe’s “online gambling hub”, and DLT in Malta’s role as a financial centre.
US State Delaware is small with 1M residents, but its sympathetic state laws mean that 60% of US Corporations are based in the state. Delaware’s blockchain initiative is aimed at addressing use cases in share ownership, record keeping, transaction and settlement.
Malta and Delaware's blockchain initiatives are directly sponsored by their Prime Minister and Governor respectively. In Dubai the nation's Ruler is on record saying all applicable transactions will be on the blockchain by 2020.
Building on the e-Estonia narrative, the Estonian government is reinventing its mission:
“Estonia is now a blockchain nation. Our digital society is underpinned by blockchain technology and our secure digital identities provide a significant advantage to blockchain companies that need to verify online identities”
former President Toomas Hendrik Ilves
What does this mean in practical terms? Firstly, blockchain companies (both physically based in Estonia, and registered in Estonia by E-residents) are using the E-residency identity verification process to satisfy KYC checks as they raise funding through ICOs. In late 2017 Estonian Government issued proposals for the establishment of an E-residency cryptocurrency, under the working title of “EstCoin” with goals of enabling a fluid marketplace and incentivising growth in the E-Residency community.
Since 2016, Sweden’s land-ownership, mapping and cadastre authority, the Lantmäteriet, has been piloting and testing its own blockchain based platform for property transactions. At March 2018, they are seeking volunteers to participate in buying and selling property who are interested in reducing the time from signing a contract to registering a sale which can take between three to six months.
The National Land Survey of Sweden has developed a full digital property transfer process with blockchain. It means sellers and buyers, and those who accept the transfer of the property’s registry, such as the Land Survey Property Registration department can create the right content in the Land Registry, and witnessing in principle can be done by everyone. The Land Registry is a publicly held ledger of real estate transactions, with inbuilt transparency and crypto security, so that no one can tamper with records without detection. With the blockchain system, the entire transaction could be completed in hours.
There are still obstacles to overcome in Sweden before blockchain can be adopted on a wider scale for real estate dealings, namely that digital signatures for registering or purchasing properties are currently illegal under Swedish law.
Swedish bank SEB is also trialing a blockchain platform for the trading of mutual funds, together with Nasdaq. The current Swedish mutual fund market does not have a centralised tracking mechanism in place (unlike equities markets), and so tracking and maintaining a ledger of transactions is a radically complex process involving a host of players, some aspect of which are still recorded with pen and paper. The platform intends to make it possible for all fund managers, distributors and other mutual fund participants to make trades directly onto the blockchain technology ledger. This would increase efficiency, tracking and auditability and make trading of funds faster, smoother and easier for all parties.
The Commission launched the EU Blockchain Observatory and Forum in February 2018 with the support of the European Parliament. It will highlight key developments of the blockchain technology, promote European actors and reinforce European engagement with multiple stakeholders involved in blockchain activities. The European Commission wants to build on existing initiatives, ensure work across borders, consolidate expertise and address the challenges created by the new paradigms enabled by blockchain (such as disintermediation, trust, security and traceability by design). The EU Blockchain Observatory and Forum will actively help Europe to seize new opportunities offered by blockchain, build expertise and show leadership in the field. It will gather information, monitor and analyse trends, address challenges and explore blockchain’s socioeconomic potential. The Observatory and Forum will review the five innovations emerging from the €5m Blockchains for Social Good competition closing later this year.
The Israeli Government funds and collaborates with businesses and academic institutions via the Iraeli Blockchain Association. With a policy of open government, Israel has commissioned an interactive political platform that promotes the policies of an open government and eliminates the communication gap between the elector and the elected. It utilises smart contracts for enforcing campaign commitments made by politicians – such as budgets proposals and policies.
Centre for Digital Public Innovation (CDPI) of the Colombian Government is looking into the potential of blockchain after the blockchain-powered voting platform Plebiscito Digital and worked with several civil society organisations to allow expat Colombians abroad and not allowed to vote to cast symbolic votes on a peace treaty through the platform.
Africa still has an unbanked majority, and so cryptocurrencies have offered opportunities to those with no access to traditional financial services. DLT is now disrupting Africa's business arena at a time where governments and industries are still rife with corrupt deals, poor record-keeping and untraceable transactions.
Last year, the Rwandan government developed the first phase of an initiative to digitise Rwanda’s Land Registry onto blockchain to aid authenticity.
South Africa's newly-appointed president Cyril Ramaphosa made an announcement in February 2018, stating that a 'digital industrial revolution commission' would be set up in partnership with the private sector and encompass new technologies, such as blockchain.
The same month, Kenya's Ministry of ICT appointed a team to produce a blockchain roadmap. Led by Dr. Bitange Ndemo, the eleven-member team will spend three months researching artificial intelligence and the potential use of distributed ledger technology in Kenya.
Also announced in February was a blockchain-based information portal for crime control in Nigeria. The citizen-focused platform, named interPort, will allow Interpol to access information and manage stakeholder engagements and crime reporting.
A pilot scheme, set to launch in Q3 2018, will use blockchain to monitor cobalt mining in the Democratic Republic of Congo. The scheme aims to ensure that cobalt used in lithium-ion batteries (found in everything from cell phones to electric cars) hasn’t been mined by children. Companies are under increasing pressure from consumers and investors to show that cobalt has come through supply chains free of rights abuses, similar to other minerals such as tantalum, tin, tungsten and gold.
This blog was extracted from our Scottish Government research which we aim to share by the end of May.