Blockchain based Digital Governance

 In New and Emerging

Co-author: Pandurang Kamat

Effective digital governance (aka E-governance) requires that the citizen engagement with the government be bi-directional, transparent, accountable and low-friction. We believe that the emerging technology called Blockchain will be a great enabler of such a system. Earlier this year, we wrote about The Blockchain Landscape and its emergence as a disruptive technology.

A blockchain is an immutable, distributed ledger that can be shared amongst entities that do not share trust, with guarantees that all will see the same copy of the ledger. Blockchains have certain core attributes that lend themselves very intuitively to digital governance. Namely

Strong cryptographic guarantees: Each user is uniquely identified using a public key in the system. Any action (transaction in blockchain terms) is digitally signed by the user behind it, thereby authenticating the user and also disallowing deniability of actions.

Auditability and transparency:  The blockchain data is accessible to all participants in the network and typically is used for verifying transactions. This access does not necessarily mean lack of data privacy since the verification data could simply be the cryptographic hash of the relevant information and not the data itself.

Immutable transaction ledger:  The blocks on the blockchain and the transactions within them are immutable. In more precise terms, it is computationally infeasible to alter the past on a blockchain without being detected. This creates a very strong audit trail.

Decentralized control: Blockchain technology is inherently decentralized, thereby preventing a single entity from controlling or modifying the data on the blockchain.  All transactions in the blockchain need a distributed consensus across all participants for them to become part of the shared ledger.

Smart Contracts: Smart Contracts are programs that run atop the blockchain fabric and whose integrity and execution is intricately linked with the fabric. These can be used to enforce rules around data exchange and transaction on a blockchain.

Blockchain based digital governance use cases

Leveraging the aforementioned properties, here are a few use cases in which blockchain can transform the way people engage their government.

Asset registration and provenance service – Governments typically run registration services for assets such as land, homes and vehicles. These services document ownership, inheritance, transfers and sales of these assets. Centralized services are susceptible to fraud both from outside and inside. The outsider threat typically comes in the form of forged documents and/or signatures and insider can come from fraudulently altering system of record. A blockchain based system can counter both of these threats and add more transparency to the system. Once an asset is registered, the record describing it is made part of the blockchain. This record is now immutable and repels insider attacks. Similarly the digital signature of the owner is part of this record and any change of ownership will need to be signed by the same entity and also recorded as a transaction on the blockchain. Leading blockchain platforms also provide APIs through which any client can access and verify the asset record information and its provenance. This essentially enables direct, secure verification by end-users via public APIs, without having to reveal the whole database.

Blockchain platforms such as Hyperledger and Multichain lend themselves naturally for such a use case.

Service Delivery Guarantees – Blockchain can also facilitate accountability around timely service delivery among government departments and officials. Each type of service would have a defined workflow with timelines and documentation requirements for each step in it. At each step any action taken by the citizen and the government official are then captured in the blockchain ledger along with a proof of the relevant data exchanged and timestamp. These ledger entries are immutable even to insider attacks and can easily be verified by third party auditor clients via APIs. This creates a highly transparent, auditable service that can be checked for service-level assurance compliance through automated processes.

Our team at Persistent has built a proof-of-concept demonstration of such a service using the Factom blockchain platform.

Decentralized Digital Locker – Citizens have to often submit a range of documents to government departments along with their applications. A great alternative to the current paper-based submission model is to be able to do this digitally and in a standardized manner. However keeping all these documents in a central service makes them a target for data breach and also allows the central authority to share these documents with others without explicit consent from the individual.

Using distributed apps (dapps) and smart contracts we can design a platform that is fully decentralized, uses distributed data stores such as Swarm or Inter-Planetary File System (IPFS) and uses smart contracts to represent the end-user so he/she can selectively share the documents and even restrict such access for limited time windows. The documents are stored in encrypted form. The documents are attested by the owner using their digital signature as well as can be digitally notarized and both these pieces of data linked to the document on the blockchain itself.

Such a platform puts control in the hands of the document owner and maintains a tamper proof audit trail from the moment a document is uploaded, to it being notarized to it being requested and received by any entity that the owner permits.

We are building a prototype of such a service using the Ethereum smart contracts platform. For more on this, read our recent post on building decentralized applications using blockchain here.

Summary

The disruption potential of blockchain can be leveraged very effectively in delivering a more open, transparent and efficient governance to the public. It helps bridge the trust gap through verifiable, immutable trail of information and holds the government accountable. We presented a few examples of the kind of innovation blockchain can bring to digital governance.  As the technology matures, we expect progressive governments around the world to start adopting it as part of their IT roadmap.

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