Let’s unleash blockchain to disrupt government corruption
Blockchain, the pioneering technology on which Bitcoin runs, can and should be used to help stamp out the scourge of governmental corruption around the world which, says a recent UN report, is an ongoing and far-reaching problem.
Corruption erodes trust and undermines the social contract, which is major cause for concern across the globe. It drives and perpetuates the inequalities and discontent that lead to poverty, fragility, extremism, and conflict.
But technology in the form of blockchain can be a game-changer. It’s a weapon to fight government corruption because it can handle secure, transparent, tamper-proof transactions of assets.
Where public registries have been riddled by altering from corrupt public officials, the blockchain would promise transparency and immutable registries. It’s designed to operate in environments where trust in data and coding is greater than trust in individuals or institutions.
If all government sources of funds and public procurements were on a blockchain, bribery, fraud and discrimination, for instance, would become considerably harder to conceal.
A lot is at stake. The OECD estimates up to 30% of all the investment in publicly funded construction projects may be lost to corruption.
Corruption has a disproportionate effect on the poor and most vulnerable, increasing costs and reducing access to services, including health, education and justice.
According to the World Bank, corruption in the procurement of drugs and medical equipment “drives up costs and can lead to sub-standard or harmful products.” The human costs “of counterfeit drugs and vaccinations on health outcomes and the life-long impacts on children far exceed the financial costs. Unofficial payments for services can have a particularly pernicious effect on poor people.”
Empirical studies by the Bank have shown that the poor pay the highest percentage of their income in bribes. Some studies have suggested that the poor may even “be preyed upon” since they are seen as powerless to complain.
There can be no doubt then that corruption is a global problem that needs a global solution. I believe that blockchain is that solution, or at least a major part of it.
However, blockchain can only be useful in those areas with certain prerequisites. These include connectivity, digital literacy, and reliable institutions.
As such, these three areas must be addressed as a matter of urgency – and any trustworthy politician, anywhere in the world worth their salt should know this and get on with meeting the challenges head on.
Then the enormous, powerful potential of blockchain can be harnessed to stamp out the pernicious problem of corruption.