4 ways that Utah should adopt blockchain technology
During the 2019 legislative session, state Sen. Dan Hemmert, R-Orem, proposed a bill to create a task force to study how the state of Utah can adopt blockchain technology. The bill passed and just a few weeks ago the Interim Business and Labor Committee met with experts, technologists and thought leaders to learn what blockchain is and the potential benefits of this new technology in Utah.
Best known as the technology upon which cryptocurrencies like Bitcoin are built, blockchain’s uses extend much further. Its real genius is not in the tech or cryptography used to build it, but in its structure.
To break it down as simply as possible, blockchain is basically a book with identical copies spread across millions of computers. If you want to change what is written in that book, over half of the network must agree with what you are trying to change. If Amy sends a bitcoin to Kate, but Rick wants to scratch out Kate’s name in the book and write his own so that he gets the bitcoin, millions of other people have to agree with Rick’s deception and allow the change. Convincing millions of people who have never met, and likely will never meet, to all agree to conspire with Rick is a highly unlikely feat.
Think of it as similar to Montesquieu’s concept of checks and balances, only instead of three co-equal branches of government doing the checking, that power is distributed across millions of computers, vastly increasing the difficulty of getting all parties to agree on a change to the record. That is why records kept on a blockchain are considered immutable and unchangeable. In a world fraught with human error, poor record-keeping, inefficiency and even malfeasance, such as government, a foolproof record-keeping device is extremely valuable.
Here are four ways the Legislature can adopt the new technology to make Utah’s government more secure, accurate and efficient.
From Rwanda to Zambia to our northern neighbors in Wyoming County, governments are implementing blockchain in land governance. For land governance in the state of Utah, blockchain can mean ease of transaction, increased accuracy and conservation of scarce resources. Liens, deeds, mortgages and more are all areas that can see improved record-keeping and transparency from implementing blockchain technology.
A smart contract is an auto-enforceable contract built on blockchain. They operate on an if-then function, so when certain conditions are met, other actions are then executed. The result is reduced transaction costs, saved staff-time and a healthier environment as paper and travel time are eliminated.
Dubai is already beating Utah to the punch here. Their goal is to be the world’s first blockchain based government, placing all core bureaucratic functions, such as tax payments, licensing and more on the blockchain. The estimated savings of this transition is $1.5 billion per year and they are already making great progress.
As an immutable, tamper-proof technology, there is perhaps no more important place to implement blockchain than in voting. Utah County has already implemented the technology through a small test case in the 2019 primary municipal elections. Their independent audit, overseen by the National Cybersecurity Center, proved that 100% of the votes cast were accurate and were cast by the correct persons.
If voter integrity and secure elections is a concern for you, this is the solution you have been waiting for.
As a backbone of government obligation, legal confirmation of one’s identity is ripe for the implementation of blockchain. Registering citizens’ identity on blockchain can provide for accurate and immediate validation of any kind of credential including driver licenses, passports, birth certificates and even educational and professional qualifications.
This is especially impactful for the least fortunate who often don’t have any form of identification and are therefore prohibited from finding housing, banking services and other needs critical to breaking the cycle of poverty.
Blockchain is already a multibillion-dollar industry and projected to see significant growth. As a growing tech hub, Utah can and should be a leader in the space. If we start now, Utah can achieve an early-adopter advantage and set and example for the rest of the country.
Despite the speculation and hype that accompany all new technologies, this much is for certain: Blockchain can dramatically improve accuracy, security and efficiency. It is here to stay, and Utah can greatly benefit from its adoption in these four areas, as well as many more.
Chris Harelson is the executive director of Prosperity Council.