The Race is On: How Blockchain Will Change Governments

Dr Mark van Rijmenam
Jul 29 · 5 min read
The Race is On: How Blockchain Will Change Governments
The Race is On: How Blockchain Will Change Governments
Image: shutterlk/Shutterstock

We are at a global crossing point and if we manage to solve some of the problems that we have created in the past decades, the world can become a better place. When the web was developed, the objective was to create a decentralised web. However, somehow, we ended up with a web which is in the hands of a few very powerful companies.

Consequently, the internet can go down and millions of people can lose access to websites if one of those centralised companies has a problem. This was the case a few years ago, when in 2017 AWS experienced ‘a glitch’, or better know a typo, which brought down the internet for millions of users. It also happened a few weeks ago, when Cloudflare went down due to a route leak. Multiple websites were not accessible for a long time.

Sir Tim Berners-Lee explained it eloquently during the Decentralised Web Summit in 2016:

“The web was designed to be decentralised so that everybody could participate by having their own domain and having their own webserver and this hasn’t worked out. Instead, we’ve got the situation where individual personal data has been locked up in these silos.” — Sir Tim Berners-Lee

Fortunately, blockchain can help solve these problems and bring the web back to its origins; a decentralised web, where everyone can participate and data are owned by those who created it.

Organisations Exploring Blockchain

Many organisations are already exploring the possibilities of blockchain, ranging from the finance industry to decentralised applications in supply chains. Companies such as Maersk, British Airways, UPS, Walmart, Shell, Travelport and many global banks are experimenting with distributed ledger technology. Fourteen of the biggest global banks, led by Swiss bank UBS, have created a “Utility Settlement Coin” (USC). This is the digital counterpart of each of the major currencies backed by central banks. They want to develop a settlement system that is capable of processing transactions in seconds instead of days.

There are also many startups working on building Blockchain solutions, in almost every domain. One interesting domain is that of identity. Currently, there are multiple challenges with how we deal with identity; it is old-fashioned, using analogue documents that are easy to be forged. Identity theft is a problem affecting millions of people and costing billions of dollars annually. Identity verification is a hassle and those organisations that have to comply with Know Your Customer (KYC) regulations face customer-unfriendly processes and increased costs. Finally, although we live in the 21st century, the World Bank estimates that around 1.5 billion people still do not have a government-issued proof of identity. As a result, these people do not have access to banking, job security, education and other basic human rights.

Startups Building Blockchain Solutions

Fortunately, many startups are working on developing solutions for Blockchain-powered digital identity. Companies working on solutions include ShoCard, BitNation and BanQu. ShoCard builds a blockchain-powered identity system that enables individuals, business and governments to establish, verify and exchange identity information in a private and secure way, while BitNation focuses, among others, on providing identities for refugees. BanQu is an identity platform based on the blockchain that enables individuals to create a personal digital profile comprised of various personal, financial or other records to build a 360-degree economic profile that can be used across organisations. In addition, Sovrin is a non-profit foundation that is building a global, decentralised identity network. They aim to deliver the internet’s missing identity layer. The objective is to allow people and organisations to create portable, self-sovereign digital identities, based on open-source distributed ledger technology, which they control and that cannot be taken away by anyone. Having an identity on the Blockchain solves the longstanding issues of identity theft, identity verification and, hopefully, in the long run, identity exclusion.

How Governments Are Affected by Blockchain

Apart from organisations, also governments are waking up. They are discovering the potential that Blockchain has to offer. Several countries are experimenting with recording land title ownership on the Blockchain. Countries such as Sweden, Honduras and Georgia are testing Blockchain technology, although Honduras’ attempts have recently stalled. They are building a land registry that is transparent, permits stress-free registration while respecting land ownership. Registering property ownership, such as land titles, on the blockchain has multiple advantages such as significantly reducing manual errors, while improving security processes for transferring documents, mortgage or contracts.

Other countries are more advanced in their Blockchain developments. The Netherlands is developing a wide range of blockchain pilots, including blockchain for health, education degrees or mobility. Estonia has developed a praised e-residency program. The program is built using Blockchain technology and it enables anyone to apply for an Estonian e-Residency. While this does not allow you to vote in the country, it does, once accepted, enable you to benefit from the digital government services that have been developed in Estonia.

As a result, you can start a company in minutes, open a bank account and start doing business. To achieve this, they are collaborating with Bitnation to offer public notary services to every Estonian e-Resident. This enables Estonia to open-up their government services globally and move towards the idea of a country without borders. It is a revolutionary approach, which focuses on efficiency benefits for companies instead of tax benefits.

Estonia is not the only country that sees the enormous potential of a Blockchain government. In 2017, Dubai announced to develop the first city built on the Blockchain. Although Estonia is ahead of Dubai, Dubai aims to achieve its bold vision by 2020. This vision is to become the world’s happiest city and be ranked first in the digital world. By 2020, they aim to have moved all government services and transactions to the Blockchain, making them immutable, traceable and verifiable, while reducing bureaucracy and inefficiencies. Having no bureaucracy and efficient government services certainly contributes to that vision, although they still have a long way to go.

Blockchain offers tremendous potential for the commercial world but has as much potential for governmental services. Governments exist in a competitive, rapidly-changing and uncertain environment, where companies are attracted by efficiency and cost-reductions. Attracting these companies requires a different attitude and increasingly, governments need to be run like a business. As a consequence, those governments that can apply the latest technology to offer innovative services for companies operating around the globe will develop a competitive advantage that could be worth billions. The race is on.


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Dr Mark van Rijmenam is the founder of Datafloq, he is a globally recognised speaker on big data, blockchain and AI, strategist and author of 3 management books: Think Bigger, Blockchain and The Organisation of Tomorrow. You can read a free preview of my latest book here. Connect with me on LinkedIn or say hi on Twitter mentioning this story.

If you would like to talk to me about any advisory work or speaking engagements then you can contact me at https://vanrijmenam.nl

Dr Mark van Rijmenam

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Dr Mark van Rijmenam is founder of Datafloq, he is a globally recognised speaker on big data, blockchain and AI, a strategist and author of 3 management books.

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