State Department to Use Blockchain in Agency Reorganization

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The State Department is seeking to use blockchain technology to improve its IT platforms and to restructure the agency.

“Protecting our cyber infrastructure and providing resilient and relevant technology to the women and men of the State Department and USAID [U.S. Agency for International Development] is crucial to helping them do their jobs efficiently all around the world, 24 hours a day,” John J. Sullivan, deputy secretary of State, said at the George C. Marshall Center Blockchain Forum on Oct. 10.

The State Department is integrating blockchain into its agency reorganization effort, which was mandated by the White House in March. The reorganization plan seeks to reduce the workforce, save Federal money, and maximize employee productivity.

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“We’re interested to learn whether blockchain technology could have direct applications to many of the key features of our proposed redesign plan–for example, in maximizing the impact and accountability of foreign assistance,” Sullivan said. “Two major challenges in foreign assistance that blockchain technology could address are, first, corruption, fraud, or misappropriation of funds and, second, inefficiencies within the aid delivery process itself.”

This forum discussed the use of blockchain-based aid-tracking systems that could bring more transparency to where foreign assistance funds come from, and where they end up.

Representatives from the State Department participated in breakout sessions in order to learn how blockchain can affect cybersecurity, encryption of data, immutable records, and decentralized networks.

Sullivan said that he is interested in developing partnerships with private companies that will help the agencies use blockchain effectively.

“Through these partnerships, we can take advantage of the creativity, unique capacity, and resources of all sectors to advance our diplomacy and development objectives,” Sullivan said. “Nowhere is this partnership more relevant than with the new technologies that are quickly evolving. But we’re certainly hopeful that the State Department and the Federal government can leverage this technology to make us more efficient and better able to serve the American people.”

Sullivan said that blockchain technology is estimated to grow to more than $40 billion by 2022.

The State Department has observed the effect that blockchain technology has had over various countries, including Estonia, where the government uses blockchain to offer digital IDs. Also, the Georgian government launched a program to register land titles using a private blockchain, the United Arab Emirates has started to use blockchain to make Dubai paperless by 2020, Singapore has opened a center for blockchain technology, and the U.N. is working with companies to create blockchain pilot projects that help refugees by developing economic identities and delivering humanitarian aid more efficiently.

“So blockchain technology is on the move around the world,” Sullivan said. “It is, therefore, essential that we better understand this cutting-edge technology, as it becomes more ubiquitous in our economy.”

Sullivan said that the Federal government is looking for ways that blockchain can strengthen national security, and promote economic prosperity.

“In particular, we’re excited about the many ways blockchain technology could also increase transparency and accountability here at the State Department and across the Federal government,” Sullivan said. “In the simplest terms, we’re always open to exploring new ways to perform government functions more efficiently and effectively.”

 

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