Uncle Sam Shows Blockchain Some Love

Today on Valentine’s Day, two subcommittees of the House Committee on Science, Space, and Technology held a joint hearing on the potential application of blockchain technology beyond cryptocurrency and financial technology. This hearing highlights the U.S. Government’s growing interest in blockchain, a Distributed Ledger Technology (DLT) that has powered platforms for secure and decentralized transactions. While its most visible exponent, Bitcoin, has been a hot topic, blockchain is gaining traction among some federal agencies as a tool of the future.

Given the sheer data demands on modern government, blockchain, which would enable what some call “democratized trust,” shows promise to cut red tape without compromising the security and integrity of government transactions. The potential use cases for blockchain are many—just to name a few: identity management, supply chain management, smart contracts, patents, and foreign aid delivery. Federal government agencies are making their own forays into this area:

 

• Department of Homeland Security: prove the integrity of captured data from border devices to help secure the Internet of Things (IoT); 
• GSA: automating the FASt Lane process for IT Schedule 70 contracts to give end-user agencies quicker access to innovative suppliers; 
• Navy: secure sharing of data within the Naval Additive Manufacturing process.

But, the government is still cautious. With a view towards cybersecurity vulnerabilities, Section 1646 of the 2018 National Defense Authorization Act requires DoD to brief on the offensive and defensive cyber applications of blockchain by the early half of this year. In practice, the government has been experimenting mostly through vehicles such as proofs of concepts and Small Business Innovation Research (SBIR) projects. These initiatives, while distinct from traditional procurements, provide low-cost opportunities for entry. Industry should be on the lookout for ways to engage the government and articulate viable uses of blockchain for particular mission requirements.