A Month Ago

The US Department of Defence is currently looking at how Blockchain technology can be used to help to strengthen its cybersecurity, as outlined in a report called Digitized Modernisation Strategy.

Interestingly, in a recent US congressional session, Senate Banking Chairman Mike Crapo said that “As Cryptocurrencies are a global innovation it would almost be impossible to ban them”. Crapo seems to believe that the US ought to be encouraging debate and formulating the rules around Cryptocurrencies. He further said, “I believe that the US should lead in developing these innovations and what the rules of the road should be”.

Perhaps this helps to explain why the Security and Exchange Commission (SEC) is recruiting staff, intending to operate nodes for many of the major Blockchains. The SEC has stated that it wants to “support its efforts to monitor risk, improve compliance and inform commission policy concerning digital assets.” The SEC intends to have all the data from the first “Block” (genesis) of a Blockchain onwards. To do this the SEC will need to analyse the complete history of all the different Blockchains that exist - which is no mean feat. The SEC could contact Byte Tree, which has already spent six years doing this by creating a “clean” database of every Bitcoin mined, and all the activity on the Ethereum Blockchain!

Having a clean database is not only vital for asset managers, which is why Byte Tree have done this. It also enables one to see the % of Cryptocurrency held by miners which have not been sold and, more importantly, can enable one to track down when a wallet owned which Bitcoin, where it came from and where it went to. This granular data could assist those who wish to investigate the holdings of Cryptocurrencies, and so track down taxes due and the source of funds for those involved in nefarious activities. Hence the SEC and the US Government’s interest.


Government Relations

3 Months Ago

The World Bank cites that corruption is one of the key challenges holding back many of the poor in the world, as it can stifle investment into a country.

It undermines trust in society, and it is the poor that are the most vulnerable, according to some studies, by having to pay the highest percentage of their income in bribes.

There have been success stories in the fight against corruption, such as in Afghanistan, where improvements to the management of its public finance, and making its procurement system more transparent, have helped the government save approximately $270 million.In Guinea, all of its civil servants in 2015 had to partake in a biometric identification system to eliminate fictitious or fraudulent positions, and potentially save more than $1.7 Million fraudulent salary payments.

In The Dominican Republic the “Participatory Anti-Corruption Initiative” was created, and it claimed it has helped to lower public spending by 64 percent.

Blockchain is proving to be a useful technology that governments are increasingly using to help in this battle against fraud and corruption. The Peruvian government has recently said that it is looking to use a platform on the LAC-Chain Blockchain to register purchase orders from Peru’s Compras, a government agency that regulates electronic purchases in Peru. The LAC-Chain has been developed by the Inter-American Development Bank (IDB), which was created to promote the use of Blockchain technology in Latin America and the Caribbean. It has a network of nodes (based on Quorum) which is a Blockchain, developed by JPMorgan and is used by the JP stablecoin. It is hoped that using Blockchains will create much greater transparency and a trusted record of transactions, and so encourage additional investment into Peru while reducing bogus invoices, fraud, and corruption on at least some of the government’s spending.

In Latin America and the Caribbean, only half of adults have access to banking services. However, 90% of unbanked adults have a mobile phone. As smartphone penetration continues to grow, the popularity of virtual currencies is also growing. In Brazil, some companies and retail stores are accepting cryptocurrencies as payment. In Colombia and Argentina, more and more of their citizens are using Bitcoin as their currency of choice, due to a lack of confidence in governments and spiraling inflation rates.  Venezuela has launched the Petro, a Cryptocurrency backed by its oil reserves. In the Middle East, Iran and separately, Saudi Arabia and UAE, are launching Digital currencies. All three of these countries have said one of the reasons for doing so, is to fight their countries’ “black economies”.

Ernst and Young produced a report “How Blockchain can help create better public services” last year, in which it gave numerous examples of how Blockchain technology is able to help governments globally.
The adoption of Blockchain technology by governments is important, as it is likely to encourage commercial organisations to embrace Blockchain as well. This ought to help improve peoples’ understanding about what Blockchain can offer and the good it can achieve, as opposed to associating this technology with Bitcoin and people carrying out nefarious activities in some form of anonymous manner.

Government Relations

5 Months Ago

The World Bank has backed a pilot venture in Haiti to help empower farmers, to tag fresh produce ensuring transparency and traceability - making it possible to track food from farm to table.

There are numerous examples of governments exploring Blockchain technology use. Examples include India looking to offer Blockchain-based payment services for overseas workers, allowing them to send money home faster and more cheaply.

In Singapore BMW, Intel and Neilson are helping the government by offering Blockchain training, technical and mentoring. It is thought that once more people understand the benefits of Blockchain technology it will encourage more mainstream use.

In New Zealand, the innovation agency has demonstrated that it is supportive of Blockchain technology as it recognise the potential benefits for companies looking to stay one step ahead.
As with all new technology there are going to be challenges, and no government has all the answers, but it is encouraging that many governments are at least being supportive and exploring how Blockchain technology can be used.

Government Relations