National governments that are keen to explore & invest in Blockchain Technology
Despite the Bear market, governments around the world have not been deterred, but instead have taken keen steps towards studying, implementing and regulating Cryptocurrencies — Few national governments have begun test piloting and experimenting with this nascent technology. The idea of distributed ledgers, revolutionizing the way we interact and secure data online, has sparked interests amongst national governments agencies and it is important to point out that some of the most developed countries are now, exploring all the potential use cases that Blockchain technology has to offer.
Authorities are now discovering what the fuss surrounding distributed ledgers is all about, with certain institutions expressing positive sentiment through regulatory sandbox environments for startups to ‘do their thing’, while other nations have attempted to outright ban anything to do with it. Even low-entry government adoption of blockchain technology have shows that the governing powers are taking innovative steps, capitalizing on the opportunity to implement modern solutions towards archaic methods (not limited to governance and democratization) to essentially redefine public services.
‘’Programmable money, to smart contracts’’.
From simply observing, institutional and enterprise-level adoption of Blockchain technology, critics are now waking up to the reality that DLT is here to stay and evolve
Let’s take a look at which governments are planning to adopt or incorporate Blockchain technology to streamline existing government based services:
Making headlines for attracting some of the biggest Cryptocurrency Exchange and known as the ‘’Blockchain island’’, Malta, manages to attract startups, exchanges and Banks to the country. Due to Malta’s Blockchain-friendly status, Binance and five top-tier cryptocurrency exchanges are planning to move their company headquarters to the small European nation island. The legal infrastructure that the Maltese government has provided to startups and companies has earned Malta, the reputation for being one of the world’s most progressive and forward-thinking nations when it comes to Blockchain regulation.
Monetary Authority of Singapore announced on the Nov 16th, 2016 that it would be partnering with R3, a Blockchain-focused consortium of financial institutions, to work on a proof-of-concept project that would allow the central bank to conduct interbank payments using distributed ledger technology. Known as the Blockchain hub of South East Asia, Singapore is said to have a progressive stance towards regulating Cryptocurrencies and attracting Block-based startups
The government has also test piloted a project dubbed ‘’UBIN’’: as part of a collaborative initiative to explore the various use cases of Distributed Ledger Technology (DLT) for clearing and settlement of securities.
Due to the government push for major Cryptocurrency adoption, South Korea has become the blockchain hub of Asia overtaking Japan & Singapore in terms of innovation, regulatory clarity, and development of infrastructure. The state government of Gyeonggi-do has successfully implemented a Blockchain-based smart contract system that lets residents vote on community-proposed projects. This voting system is developed by Blocko, a company that owns the right to Coinstack, the proprietary software utilized by the open-source project Aergo — a hybrid platform that helps enterprises bridge private & public blockchains. The Bank of Korea with the help of Blocko, is testing a Blockchain-based micropayment settlement infrastructure to determine the feasibility of conducting micro-payment transactions. Regional government, Financial Corporation and the Central bank, are keen on using DLT to make financial transactions and processes more transparent, resilient and efficient.
Pelotas and Morro Redondo are two Brazilian regions to have commenced a blockchain-based pilot program, one that would store public property record data on the distributed ledgers. Initially, the idea was to build a parallel platform that will replicate the existing legal structure of property ownership by essentially, recording and transferring that sensitive data to a Blockchain. Brazil’s Ministry of planning, budget, and management is test piloting a blockchain-based identity application dubbed Project uPort. The project is spearheaded and built by ConsenSys, in an attempt to streamline a blockchain self-sovereign ID platform.
It is said that Switzerland has set the legal foundations for the blockchain industry, as the government has announced a strategy that plans to introduce all the necessary framework needed to regulate DLT. The number of startups that have flocked over to the country with the intention of fundraising money, has earned Switzerland, the reputation for attracting startups and an ICO haven — this is due to the country’s friendly jurisdictions towards ICOs. Swiss authorities have also launched a dedicated Cryptocurrency special Task Force, to ensure that the country continues to review & study the national regulatory framework. Switzerland authorities are fine-tuning regulatory framework, in order to attract businesses to the country by providing more legal clarity, especially for startups
The National Archives (TNA), the official record-keeper of the UK government is exploring the potential use of blockchain for records sharing. The Project dubbed Archangel is a government initiative to experiment with decentralized distributed ledger technology to ensure the long-term integrity of digital documents stored within public archives. The Royal Mint of England has also attempted to issue out a digital gold token, however, was faced with the waves of skepticism as the UK’s government remain wary of Cryptocurrencies and denied such move. This is set to change in the near future, as key agencies, authorities and regulators are set to be studying the potential use-cases of DLT
The first country that plans to utilize Blockchain technology for a national identity scheme. The eastern European country is but one of the collective nations leading the way for the blockchain revolution as the Estonian government has been testing distributed ledger technology since 2008. Implementing Blockchain technology as part of the E-Estonian Digital Residency program to secure health records, court files and wills.
A Bitcoin haven, for now — the German government has stated that Cryptocurrency, as an asset is not to be classified as a commodity, stock, or a form of currency. Recognizing the need to regulate Cryptocurrencies, the government has classified digital currencies as private money and have imposed 0% taxes. Traders aren’t required to pay any capital gains tax, essentially, making Germany a tax-free haven for investors and traders. Meanwhile, Berlin is set to be a thriving city that manages to attract Blockchain startups and businesses to the country
By 2020, Dubai aims to become “the first blockchain-powered government,” weaving the technology into many vital systems. The government of Dubai has the ambitious goal of securing government documentation by essentially, uploading it to a distributed ledger for storage and bookkeeping. The plan is to become the first country to be powered by blockchain ~ permitting visa applications, license renewals, and bill payments to be transacted online using DLT.
United States of America
America still has a lot of catching up to do when it comes to Blockchain Arms Race, the main reason why it may be struggling is due to the regulatory clarity, the SEC, recent crack of Crypto, ICO and Exchanges have caused a lot of uncertain for Blockchain startups.
Looking at the bright side, on the state level, the Illinois Department of Financial and Professional Regulation (IDFPR), which manages physician licensing has begun to test pilot blockchain technology with Hashed Health to streamline complex processes. The objective of the project is to digitize medical credential data through automation using smart contracts. Both the Pentagon and DARPA are vigorously studying blockchain technology to test the theoretical immutability of distributed ledgers and to design robust security protocols.
As part of $8 Million Government grant, Powerledger, the startup endorsed by Richard Branson plans to utilize Blockchain technology to allow for the storage and distribution of power. The Australian government is test piloting a blockchain-powered distributed energy and water system in the city of Fremantle. The Commonwealth Scientific Industrial Research Organization (CSIRO), Data61, and Commonwealth Bank of Australia have successfully tested a blockchain-powered application. Moreover, the country has completed its trial and are working on a service that intends to utilize distributed ledger technology to streamline the distribution of security welfare payments.
Back in 2018, the government of Tsukuba has introduced an online voting system powered by Blockchain, that allowed residents to cast votes on social developments — making it the first city in the country to utilize DLT for democratic voting (other countries are following their path as one of the pioneers).
In the past, the Japanese began to study blockchain systems for content management that would allow Japanese business to improve copyright handling using smart contracts. Japan’s Tax Commission is also looking into ways to streamline the current tax filing system, experimenting with Blockchain technology to simplify the overall process.
The somewhat dysfunctional government of Venezuela, was one of the first to attempt to standardize a national Cryptocurrency. The president, Nicolas Maduro has come foward, making bold claims that the current, government regime is backing the digital currency known as the Petro with Oil. The initiative is set to help supplement Venezuela’s plummeting bolivar fuerte by letting, the Petro, become a mean to circumvent U.S. sanctions by using a digital currency to bypass traditional financial markets. Due to the skepticism surrounding the Petro and current government regime, it remains unlikely, if the national cryptocurrency will be used in trade or become widely adopted throughout Venezuela.
Due to headlines, the vast majority of the world thinks that China has a rather negative stance towards cryptocurrencies and Blockchain industry. However, don’t let that fool you because China is among the most forward-thinking when it comes to experimenting with Blockchain technology, with government playing a big roll behind the scenes. Chinese Authorities, in the past, have tried to outright ban Bitcoin and Cryptocurrency mining but the latest statistics, suggest an increasing amount of blockchain startups to be operating from the country. Chinese state-owned banks and commercial banks are said to be studying Blockchain technology and are rumored to be supporting the development of DLT through a wide number of established startup projects such as NEO, Qtum, Vechain & Tron (to name a few).
A country that has also joined the list of countries to impose zero taxes on cryptocurrencies, in attempt to attract digital currency investors and boost digital payments. However, as of January 14, 2019 the Danish Tax council intends to introduce new regulatory framework, requiring Exchanges to disclose personal data. The country has also joined the European Blockchain Partnership (EBP), a joint declaration agreed between 21 Member States and Norway. The signatories have also agreed to cooperate in the establishment of a European Blockchain Services Infrastructure (EBSI) that will support the delivery of cross-border digital public services, with the highest standards of security and privacy.
As of right now, the Shipping industry stands to gain the most from blockchain adoption, as Denmark attempts to become the first country to use a distributed ledger to manage a national ship registrar.
With blockchain usage on the rise in Spain, the government is set to show optimism towards this disruptive technology as Banks, politicians, and civil servants are keen on exploring all the opportunities that DLT has to offer. Whilst the country remains somewhat silent, there are reports of governments civil workers studying, being trained, and educated about blockchain technology. Spain seems to be leading the way in terms of the number of banks that are tapping into DLT with the general sentiment indicating that the Nation may be setting itself up to become a blockchain hub of the finance world.
At this present day, governments have mixed feeling about Cryptocurrencies. Many taunt that digital currencies like Bitcoin & Ethereum are nothing more than speculative investments and that we’re in a bubble that is set to burst. But in contrast, several countries along with their financial authorities have come forward to understand that the technology provides more than just a highly secure system for facilitating cross-border remittance at a fraction of current costs, but a paradigm shift in traditional database via a marriage between consensus-driven models and cryptography.