The blockchain in the public sector – quo vadis?

The blockchain is much more than just the technological basis of cryptocurrencies. As a transaction system, it is rather predestined for applications in the field of registers, bookkeeping, taxes, finances and the like, and thus especially for public organizations and the performance of their tasks.

It should come as no surprise that the blockchain is predestined as a transaction system for applications in the public sector with its registers, books, evidence and administrative files, as well as the associated requirements for data integrity, legitimacy and security. Those involved in the public sector are also aware of this potential of blockchain technology. For example, a 2020 show among executives in public administration, municipal administration as well as in health and social services carried out by the BDO Blockchain Initiative surveythat “64% of respondents are open to innovative solutions [zeigen], and 57% believe the public sector will unlock the potential of blockchain technology. ” This is also confirmed by the various current blockchain-based applications and projects in this area, such as:

  • the commercial register in Malta,
  • a land register in Sweden,
  • a land register in the United Arab Emirates,
  • an ID system in Argentina and Ethiopia,
  • an electronic identity, from tax returns to electronic patient files in Estonia and
  • first (Abitur) certificates in some German federal states.

Regardless of the various applications that have already been implemented, “80% of those surveyed … the lack of blockchain regulation [als] the biggest obstacle to the implementation of the blockchain ”. Furthermore, there is often a lack of appropriate knowledge about the blockchain, as well as concrete and sustainable practical examples. In addition, the blockchain is still struggling with a certain “dirty” image, which is often characterized by media reports on individual crypto currencies and these are simply equated with the blockchain as a technology, so that there is often still insufficient acceptance. Nevertheless, a lot has happened here in the recent past, so it is worth taking a closer look.

Where does the federal government’s blockchain strategy stand?

With the one that was adopted in autumn 2019 and developed with the involvement of various experts Blockchain strategy the federal government had presented an initial framework for action and development. A total of 44 measures in 5 fields of action were named in the strategy paper. In what is most interesting from the public sector’s point of view, the “digital[n] Administrative Services ”, with 10 measures, became like one small request to the federal government, in the meantime all measures have started. However, it is not clear what this means for the specific implementation status. It will be exciting to see whether the blockchain strategy will manage to achieve the goals associated with it or whether it will, as has been the case for a long time and recently by Frank Schäffler, member of the Bundestag for the FDP laments, just “announced with a lot of fanfare [wurde], but at the end of the legislative period … just hot air left …[bleibt].”

What plans are in the coalition agreement?

In the current coalition agreement, the blockchain can be found in three places or, with the inclusion of applications from the field of cryptocurrencies, in a total of eight places. Accordingly, inter alia planned, “commissioned a feasibility study [zu geben]to investigate whether a land register on the blockchain is possible and advantageous. ” (P. 92 des Coalition agreement).

What general developments are there?

Overall, there is a slow but steady interest in further building up knowledge and transferring this into concrete applications. This year, for example, the Lower Saxony Ministry of Economics, Labor, Transport and Digitization launched a Blockchain ideas competition hosted. Since “blockchain technology … is only slowly taking off in the free economy[kommt und] … the necessary know-how is missing in many companies and the potential of the technology is not yet sufficiently known, [wurde in] … the competition … based on practical examples [gesucht]that make the possibilities of technology tangible so that it can be further disseminated in Lower Saxony’s economy, ”said Lower Saxony’s Minister of Economics and Digitization, Dr. Bernd Althusmann (CDU).

This trend towards specific applications is also reflected this year Gartner Hype Cycle on the blockchain, so that the blockchain, after the past few years were characterized by a mix of excessive expectations and, of course, the associated disillusionment, is now in the phase of clarification and on the threshold of the plateau of productivity. Thus, in the medium term, the exciting phase of “real” and sustainable applications on the blockchain, both in the public sector and in the private sector, should begin.

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The blockchain in the public sector – quo vadis?

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