Blockchain is becoming increasingly popular among industries worldwide and has the ability to revolutionize the way the world conducts business digitally. Blockchain is defined by IBM as, “a shared ledger for recording the history of transactions, that cannot be altered.” It has no central authority and is peer-to-peer combined with a system of “smart contracts” and other assistive technologies. Blockchain is decentralized, meaning it is stored on multiple computers, enabling it to be immensely secure with no way of being altered unless altering all other blocks. All parties must give a consensus before a new transaction is added to the network. Blockchain is utilized worldwide by a variety of industries including finance, health care, law, real estate, government and education.
To fully understand the scope of blockchain it is important to dissect the word. The “block” refers to the digital information stored on the “chain,” public or private networks. The blocks, where digital information is stored is comprised of three different functions:
- Storage of information about the transaction, such as the amount, and the date and time
- Information about who is making the transaction
- Each block has an identifying “hash” created by algorithms to immutably chain the data
The state of Florida has the opportunity to integrate blockchain technology into effective and efficient government uses. In 2019, 45 blockchain bills were passed and many state governments are already exploring how to transition blockchain into government functions such as registrations, benefits, voting and elections, identity management, asset tracking, payments, health care and many more projects.
Blockchain has the potential to prevent fraud, overpayments and overpayments for state benefit payments by creating an all-inclusive ledger of benefit recipient information across multiple states. This use of blockchain technology will help states determine if a person is already receiving benefits by accessing benefit information when determining eligibility. This will help prevent fraud and increase efficiency by allowing multiple states and agencies to match eligibility information. Overall this will benefit states by helping decrease time spent matching individuals and decrease the amount lost to dual-enrollment and fraud.
Additionally, blockchain has multiple uses for the health care industry. It often has issues with streamlining data due to the high volume and high sensitivity of information. Blockchain technology would simplify these issues by making it easier to access information within different nodes of the industry, including the supply chain. Supply chain issues are a common topic in the face of the COVID-19 pandemic. With blockchain, industry suppliers would control nodes and each time the supplier entered transactions, they would be recorded on the blockchain, simplifying the collection and transfer of data and allow consumers to easily maintain and track transactions. Physicians often face credentialing obstacles multiple times a year, taking away from patient care, costing billions annually. Blockchain would allow health care providers to easily access and enter credentials to avoid redundancies in submitting credentials.
In 2019 the Blockchain Task Force was established within the Florida Department of Financial Services to explore and develop a master plan for the expansion of the blockchain industry in the state. The Task Force is responsible for recommending policies and state investments to make Florida a trailblazer in blockchain technology. The task force studies how state, county, and municipal governments can benefit from a transition to blockchain-based systems for recordkeeping, data security, financial transactions and service delivery.
Florida’s task force will continue to lead through 2021 in an effort to continue to advance the integration of blockchain in state buisness. The natural progression of blockchain technology will continue to lead the state’s transition to innovations in FinTech, or financial technology. FinTech will compete with traditional financial proceedings by increasing efficiency and security. The task force will continue to monitor and suggest legislation that will support the advancement of this new technology and look forward toward new strategy and usage.
There are many practical applications for blockchain that are already being explored by businesses worldwide. This technology will make business and government proceedings more secure, efficient and accurate.
Ronald Brisé serves as chair of Gunster’s government affairs and lobbying practice. He is a former state representative and member of the state Public Service Commission.