US Congress learns about blockchain’s value—far beyond cryptocurrency
Joint committee hearing explores domestic and international uses of blockchain technology, including identity and contract management
On Wednesday, February 14, two subcommittees of the U.S. House Science & Technology Committee held a joint hearing titled Beyond Bitcoin: Emerging Applications for Blockchain Technology. Over a dozen members of the Committee attended so they could explore the scientific mechanics of blockchain and its potential to improve information systems both in private enterprise and the public sector.
Presenting witnesses were: Chris Jaikaran of the Congressional Research Service, Dr. Charles Romine of the National Institute of Standards & Technology (NIST), Jerry Cuomo of IBM, Frank Yiannis of Walmart and Aaron Wright of the Cardozo School of Law’s Blockchain Project.
Representative Ralph Abraham of Louisiana chaired the hearing, and Reps Clay Higgins (R-LA) and Barbara Comstock (R-VA), co-chaired. They focused on learning about standards, guidelines and best practices for commercial blockchains and for improving government efficiency and cybersecurity. Federal agencies highlighted were the Departments of Energy, Homeland Security and Transportation, the IRS and the U.S. Postal Service. Ranking Democrat Rep. Don Beyer (VA) participated actively and noted how blockchain was the hot topic of conversation at the World Economic Forum in Geneva recently.
The witnesses described examples of a nearly unlimited and diverse array of private and public blockchain applications, including food safety, agricultural output tracking to specific farms, personal identity authentication and verification, electronic health records with strong access controls, cross border land ownership registries, election voting systems, and minimization of “honeypots” of military and other government data in the cloud.
Cuomo of IBM spoke highly of its private-public collaboration with SecureKey, a Canadian startup, the Sovrin Foundation and the government of Canada. This work on permissioned blockchains allows Canadian banks to build fintech applications that automatically adhere to government regulations. Cuomo also mentioned VerifyMe, a tool for identity verification in transactions like employee onboarding, and for authentication of commercial goods. All agreed that blockchain holds promise for digitally establishing personal identity and legal rights globally for people who struggle with mainstream validation.
Licensing drivers in a more secure way was one of the local government uses of blockchain mentioned. Yiannis of Walmart also noted “democratizing” benefits of blockchain like better disclosure for consumers about the origin of groceries they buy.
The witness from NIST advised that one big long term technical challenge was protecting blockchain algorithms from “cryptographically relevant quantum computing” that might “break the code” in the future. More immediate pitfalls discussed were data portability, private and public key security, user collusion, user safety and scalability of blockchains.
Law professor Aaron Wright analogized development of blockchain technology to the development of the Internet, which grew out of a collaboration among the Defense Department, academic researchers and the private sector, based on basic shared guiding principles. Wright referred to blockchain innovation hubs in New York and the San Francisco Bay area that are focused on things like working out the bugs in “new breed” blockchain apps like smart contracts that record agreements in software code rather than natural language.
Predictably, many members of Congress are wary of extending anything related to cryptocurrencies to the federal government, but new budget constraints are likely to prevent “parking” blockchain expertise in each separate agency or department, as one of the witnesses suggested. All the witnesses warned against government being “too prescriptive” regarding blockchain, but no member of Congress actually proposed new regulation.
Separately, the Congressional Blockchain Caucus, chaired by Reps. Jared Polis (D-CO) and David Schweikert (R-AZ) recently held a workshop on digital identity authentication and anticipates further exploration of electronic payments and supply chain management.
