Blockchain is the technological innovation behind Bitcoin. What could it deliver for councils and other providers of local public services?
Socitm – the professional network for digital leaders in local public services – is at one with those that think there is great potential in blockchain technology, and perhaps even a step change on the road to a truly all-digital, open e-economy.
Blockchains underpin Bitcoin and other digital currencies, the first applications of the concept. These ‘digital crypto-currencies’ are viable alternatives to fiat paper money systems. They can operate without the need for a central bank or any other kind of single authoritative organization to manage the money system and engender trust in it.
As of 3 August 2016, there are, in round numbers, just shy of 16 million Bitcoin ‘in circulation’. At the exchange rate of £428 per Bitcoin, that’s £6.85bn worth of ‘virtual money’ entirely made and managed by software running on a network of computer servers essentially not owned or under the direct control of any governmental or banking authority. This is precisely the opportunity or the threat of this application of blockchains depending upon your viewpoint.
As a general principle, the blockchain distributed ledger concept and enabling open source software technologies behind Bitcoin, which verifies each currency transaction, can be applied to any circumstance where a single, immutable, trusted record of peer-to-peer transactions – not just of the money type – between people, organizations or objects in the Internet of Things would be useful. And this is where it is potentially transformational and disruptive at least, potentially fatal even, to the business model of any intermediary party who makes a living from taxing the transaction traffic flow.
The government agrees, according to the paper Distributed Ledger Technology: beyond block chain published by the Government Office for Science in January, which […]
