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Dubai and EU Give a Peek into How the Blockchain Transforms Government

Reading Time: 5 minutes by on October 7, 2016 News, Tech

Governments around the world are starting to appreciate the multifaceted use of blockchain technology and are looking to adopt the blockchain in various ways, such as the government of Dubai, who are using the technology to cut down on bureaucracy.

In modern society, we continue to experience digitalization in many aspects of our lives, which is transforming the way we shop, stay in touch with our friends and family, and how we conduct business. However, elections and many other functions of government continue to take place offline, on paper and the realization of blockchain’s potential will inevitably lead to an e-voting system, as well as other advancements.

The development of e-voting can simplify and speed up the process of voting as well as reduce the administration costs of elections. Ultimately such technological advances are likely to lead to higher voter turnouts and strengthen democracy.

The European Parliament recently released a paper on using the blockchain to run elections. The paper highlights that e-voting will provide more flexibility and freedom to voters as individuals no longer need to rely on the central government to manage elections. There are a number of ways e-voting can be delivered, by accessing the internet on mobile devices or laptops to a secluded network that necessitates voters to attend a polling station. Citizens can have the option to distribute an open voting record through the adoption of blockchain technology, leading to a transformation for the future of an inclusive democracy.

The blockchain allows transparency amongst users as they are able to log and verify voting records themselves without the need for central governments to monitor, count or manage the voting process. The unique feature of this system is that once the votes are logged into the system the votes are visible to all the users and cannot be amended. Thus an accurate record of votes will be noted with no room for illegitimate votes.

One way the development of Blockchain Enabled e-Voting (BEV) can be implemented is by creating a custom-made protocol, formed with a set of election and electorate features. Another way to adopt BEV is operating elections on a more reputable blockchain network. For example, the system used by a well-established virtual currency such as bitcoin, which may be easier and cheaper to conduct, could be used to run an election. Also, this will provide a secure way to conduct elections when there are a small number of voters, eliminating manipulation.

However, BEV’s most powerful impact is likely to be on the organizational level, rather than in the context of nation states, in the near future. For example, BEV has been implemented in Estonia for internal elections of political parties as well as for shareholder voting. BEV can be merged with smart contracts directly with pre-agreed conditions, such as specifications of government spending. Therefore when a particular party wins an election, the funds can be released automatically to earmarked projects. Also, there are prospects for the application of smart contracts to direct investment decisions as well as various other organizational decisions.

Whilst BEV is likely to increase youth participation in the political process, it does share similar drawbacks as traditional paper methods concerning accessibility, anonymity and coercion. Research is being conducted to ensure the development of full anonymity for the BEV system. Another way to protect anonymity is to trust the central government in the same way we do for the paper voting method, where the government will maintain some power to distribute pseudonyms and not reveal them. However, this is at odds with the ideology of decentralization associated with blockchain platforms.

BEV is faced with the challenge of ensuring collective public trust and confidence, while taking on the responsibility to provide a solid and dependable security infrastructure. Since the nature of blockchain protocol is complex, this may be an obstacle for persuading the mainstream public to participate in BEV systems. For example, the outcome of a BEV election requires specialists to ensure the integrity of the elections via the blockchain, or alternatively, the general public needs to be well-versed in the workings of cryptography and blockchain technology.

Finally, it is important to consider the different values and politics BEV imposes. Since this approach does not only digitize voting but also gives voters the freedom to manage the process themselves, this bottom-up approach could lead to a decentralized and more inclusive democracy.  

There are many other possibilities for the use of blockchain technology in the realm of government. For example, the Dubai government announced on October 5 that plans have been set in place for all transactions to be relocated to a blockchain platform by 2020 as part of the Dubai Future Agenda.

Dubai’s crown prince, Shaikh Hamdan Bin Mohammad Bin Rahid Al Maktoum, stated that the strategy’s purpose is to accomplish outstanding levels of efficiency across government departments. The government’s strategy is focused on three key features such as creating new specialized sectors, achieving global leadership and efficiency.

The agenda anticipates efficiency gains through the transfer of all government transactions to a blockchain platform by 2020. Further, approximately 100 million paper transactions per annum will be eliminated. This bold move will not only protect the environment but has the potential to reduce 25 million work hours associated with paper dealings at work. These saved hours will lead to productivity gains for government employees, having a positive knock-on effect on the national economy.   

The second feature of Dubai’s strategy is to create new employment for 1,000 people built on the blockchain platform. Therefore enabling Emirates, expatriates and investors locate firms providing valued services that contribute to the nation. In addition thousands of jobs will be created in a wide range of sectors comprising of healthcare, transport, banking and consumer technological sector, etc.   

The final feature emphasis on Dubai’s achievement of global leadership through the developments and fostering of the blockchain platform. Dubai Future Foundation and Dubai Smart City Office are collaborating to achieve the goals to revolutionize the UEA into global center for designing the future in line with Dubai Future Agenda.

The vice-chairman of the Board of Trustee and managing director of Dubai Future Foundation, Mohammad Abdullah Al Gergawi, stated:

“The strategy will result in substantial economic saving that can be reinvested in value-added sectors and will contribute to saving millions of hours wasted in entering data and ensuring their veracity. It will also create new economic fields and businesses as the volume of Blockchain market is expected to hit $300 million over the course of the next five years.”

As part of Dubai’s strategy to position themselves as a leader in adopting new technology, their government will be the first to roll out a blockchain network that allows a variety of government and private agencies to exchange their services into currencies that can be traded on the blockchain and substituted with other services.

Voting and reducing bureaucracy are only two applications of blockchain technology in the government realm. Blockchain networks are multifaceted and possess great potential to be applied to a variety of government activities, such as anti-money laundering and immigration issues.

While there is optimism surrounding voting on the blockchain, any system where the voter authenticates themselves using cryptographic keys requires them to safely and reliably store these keys. Since key management has resulted in numerous instances of the loss of bitcoin, a blockchain system for voting should cautiously consider usability.

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