CAYLA MURRAY: Blockchain can make government more transparent

A vibrant emerging sector in SA forms part of our tech ecosystem. The sector calls itself the “blockchain community”, and it is indeed a community. It consists of individuals from all walks of life — including artists, entrepreneurs, do-gooders, and tech enthusiasts, all excited by the prospects of this technology.

When most people hear the words blockchain, bitcoin or nonfungible tokens (NFTs), there is a tendency to think about Instagram scammers who seemingly became wealthy overnight, or maybe even that it is a complicated technology only a few can benefit from — financially or otherwise.

What people often miss is that blockchain can improve service delivery tangibly. This is because it was built to bolster transparency and ensure decentralisation.

As a politician who firmly believes in the need for small government and the reduction of red tape, I see blockchain as a promising tool.

The implementation of blockchain is part of what the blockchain community refers to as “web3”. It is a part of the evolution of our use of the internet to earn money, and understanding it is essential to ensuring we are not left behind amid the fourth industrial revolution.

What fascinated me at a panel discussion hosted by CV Labs was that its application is being tested and expanded daily. Worldwide blockchain is not capped at creating “bitcoin millionaires”, but is being used to unlock bottlenecks in service delivery.

This is because blockchain is a digital ledger, recording information that cannot be erased. Every change or adjustment to the ledger forms a new block in the chain, which creates an immutable and public record. This is what makes it transparent. Data stored on a blockchain is also decentralised; it is not stored on a single computer or server but is dispersed.

An example of how blockchain promotes transparency and decentralisation is Koa’O Truffles’ use of a blockchain to track cocoa beans from growth to production in Ghana. The use of blockchain allows for 100% transparency in farmers’ pay, boosts the economy through job creation and reduces waste by up to 40%. Those who farm for Koa’O Truffles are thus well compensated relative to their local farming peers, and the services rendered to the community have improved.

Other applications

The technology itself is premised on being transparent and decentralised — values my party holds dear. Due to the horrendous history of government corruption in SA we would all welcome more transparency and a lot less dealing done in the shadows.

While blockchain may be associated with bitcoin and cryptocurrency generally, it has other permanent, decentralised database applications that can be used to improve service delivery. Governments have access to vast amounts of data, which they need to store — safely. This includes births and deaths, marriages and divorces, numerous licences and medical records.

Title deeds are an example of how blockchain can improve service delivery through decentralisation and transparency. The Western Cape deeds office has a considerable backlog, which among other things prevents transfers of ownership to beneficiaries of government housing projects.

This process could be streamlined and made more transparent through a digital ledger rather than traditional methods of record-keeping stored on a single server, which could be easily tampered with or lost. This is because every change of ownership is permanently recorded and cannot be tampered with without leaving a record. It would in effect improve service delivery by strengthening individual property rights. 

This technology does require further development to be fully implemented and used within our government systems — especially to provide for mechanisms to terminate or modify smart contracts for legal purposes and associated legal remedies. Members of the blockchain community refer to this as requiring more “use cases” — though the current use cases in service delivery are already encouraging.

We need to keep an open mind regarding new technologies to ensure we are not left behind amid the fourth industrial revolution — this is especially important as our province’s fintech ecosystem is continuing to grow and drive job creation.

The need to consider the use of blockchain for service delivery is compounded by our continuous aim to improve service delivery. This requires that we investigate technologies such as blockchain that enable governments to deliver their services in a more transparent and decentralised manner.

• Murray, a DA MPL, chairs the Western Cape standing committee on finance, economic opportunities & tourism.