Public Sector: Blockchain Use-Cases

Today there are tens of thousands of pilots trying blockchain technology in numerous features of society. The public sector, specifically government, has also shown significant interest in blockchain technology. Currently governments on all landmasses except Antarctica are engaged in blockchain pilot projects.

The public sector is responsible for many areas of trust and services so there are a large number of use cases across countries including: the European Union (EU — anti-counterfeiting), Estonia (Digital Government), US (FDA, DHS, HHS, GSA — security, anti-counterfeiting), China (Payments), India (Payments, Land Registry), Switzerland (Identity), Denmark (Voting), Dubai (Digital Government), Georgia (Land Registry), Gibraltar (Stock Exchange), and many more.

Some of the spaces in the Public sector that Blockchain can fit in to-

Identity Management/Attestation

Blockchain technology provides three special capabilities that enable it to provide a better foundation for identity than current systems. First, all data is recorded on the ledger via a consensus mechanism which enlists multiple parties to verify that the data is correct before it is written. Second, all transactions in the ledger are immutable and digitally signed, which means the records are unchangeable and those who wrote the records are accountable for any issues. Third, the digital, immutable record can be linked to a biometric or set of biometrics (i.e. thumb print, facial scan, etc.) which means that it is unique, easily verifiable, and nearly indestructible.

Blockchain has the potential to solve the challenges section above — fake documents, corrupt officials, and destroyed records, as described below:

· Fake documents — identity would be verified via a biometric scan which would access official records found in a blockchain ledger which virtually eliminates the need for documents

· Corrupt officials — the data about one’s birth is immutable and cannot be modified once made so corrupt officials become powerless to make changes

· Destroyed records — as the data is digital and stored in decentralized storage it can be considered virtually indestructible

Regarding the challenges faced by those with no identity papers or destroyed records, there are various initiatives currently underway using the power of blockchain to provide solutions to governments. For example, the ID2020 initiative is an alliance of governments, NGOs, and the private sector to provide a blockchain-based framework for digital identity that will be personal, persistent, portable, and private. In essence, each individual will be able to own and control access to their personal identity information and be able to access it at all times from any location (decentralized cloud).

Government Records (Personal records, Land registration, Corporate registration)

The major challenge in all of the cases listed above is that a paper-based document is used to transmit some kind of information and identity to the bearer. Because these documents are easy to forge or can be based on real, but stolen documents, they convey significant privileges to the bearer with only a small risk of exposure.

In a blockchain-based system, paper-based documents are replaced with digital documents on an immutable ledger. The immutable nature of the blockchain means that these digital documents are impossible to duplicate or forge because there is only a unique, single record. Additionally, the digital documents can be made accessible only by a biometric scan, for example a face scan, a full hand fingerprint scan, a retinal scan, or potentially a combination thereof.

Governments have begun to implement blockchain-based systems for key record types. For example, in Andhra Pradesh in India, in Fintech Valley Vizag, blockchain systems are being used for land registration records and for vehicle registration. Fintech Valley Vizag is in the process of building up a large portfolio of blockchain use cases to improve the efficiency of government and private sector operations.

Land registration was selected first because 66% of civil disputes revolve around property disputes which creates a significant drag on the economy. The primary issue was that due to paper documents, much of the populace could not prove its ownership of property and records could be easily modified for a price. Blockchain’s immutable records and audit trail have already secured over 100,000 land records, providing certainty to owners. This same system has now also been applied to vehicle registration, to provide certainty and security around vehicle registration records.

Entitlements/Citizen Services Management (Healthcare, Consent)

Blockchain technology provides a single solution to all three challenges noted above. First, it can provide a secure digital identity; next it digitizes all new data transaction data automatically and securely; and finally, it creates an interoperable platform across departments and agencies. This is not a theoretical exercise as blockchain-based e-government systems do already exist.

Estonia is home to the most famous blockchain-based digital government and e-residency program. This portal enables anyone to become an e-resident of the country in 30–60 minutes and at a cost of 100 Euros. Estonian e-residents can use the portal to create a digital identity, establish a business, setup banking relationships, and execute business documents. Famous e-residents of Estonia include Tim Draper, the famous Silicon Valley VC, Pope Francis, Angela Merkel, Chancellor of Germany, and Shinzo Abe, Prime Minister of Japan. Estonia is also planning to launch its own digital currency called Estcoin.

Dubai is another leader in blockchain-based e-government. Dubai plans to have all of its government documents on a blockchain by 2020 and 50% of its services operating on a blockchain platform by 2021. These systems will streamline all government activities and are forecast to save 10’s of millions of hours of work and billions of dollars annually. Dubai is also planning to issue a digital currency to enable cross-border payments and track all real-estate transactions on an immutable blockchain ledger.

Other countries would be wise to follow a similar path because of significant cost savings, efficiency gains, and the ability for countries to compete for businesses and citizens.

Government Activities (Voting, Taxation, Customs)

blockchain-based systems can create a unified and secure digital identity. Data and transactions are then stored by default in a highly encrypted format to a decentralized network where each transaction is digitally signed. A robust consensus algorithm can ensure the validity of all transactions while the immutability of the ledger ensures the data cannot be modified from its original form.

Pilots of blockchain-based voting solutions now exist in Switzerland, Denmark, Russia, and the US. In Switzerland the city of Zug has used blockchain-based voting in combination with an Ethereum-based digital identity solution. The pilot was successful and the results are now being evaluated to ensure that the results are both immutable and auditable while protecting voter privacy. In West Virginia an e-voting pilot will be launched in November 2018 that will enable overseas military to vote in the mid-term elections. The pilot will be based on smartphones and will use streaming video, facial recognition and a military ID to confirm the identity of voters.

Online tax bills can now be paid by e-residents in Estonia via the blockchain-based solution outlined in the prior section. At the World Economic Forum in Davos in 2016, 800 attendees took part in a poll on blockchain-based taxes. 73% of respondents indicated they expected blockchain-based tax systems to be in place in most developed countries between 2023–2025.

US Customs and Border Protection (CBP) in collaboration with the Department of Homeland Security (DHS) are working on two separate blockchain customs projects. One project is focused on validating certificates of authenticity for products that cross into the US. The joint goals are to enable customs officials to intercept counterfeit products while the second is to allow consumers to quickly verify the authenticity of products prior to purchase. The second is designed to secure the sharing and storage of data from security cameras and sensors and via an immutable record to prevent the manipulation and hacking of data.

Across these use cases, blockchain enables greater efficiency, less fraud, and lower costs. The holy grail is fully paperless, digital government with minimal corruption.

Advantages of Blockchain for Health Data

The blockchain era has already begun. Taking into account the fast progress in the development of new and more efficient healthcare record systems, wearable devices, and medical examination systems implementing artificial intelligence, cryptography will become an important part of the way hospitals work. There are, however, a few improvements still needed in order for seamless blockchain adoption across the entire medical industry. According to Hyperledger’s survey, 42.9% of healthcare organizations suppose that the interoperability of electronic health records will help for faster blockchain implementation; with 28.6% of respondents ready to use this technology in care settings today. So, what are the benefits of blockchain technology in healthcare?

Data Provenance and Integrity

With an ongoing increase in patient numbers, healthcare providers have to manage more and more health data on a regular basis. As the data volume increases each year, it becomes harder for hospitals and clinics to process and store information.

Data managed by medical organizations includes:

· Patient health information (PHI);

· Electronic health records;

· Data collected from IoT devices (Internet of Things) or monitoring systems; and,

· Medical insurance claims.

Secure information sharing methods, which allow both healthcare providers and their covered entities to verify the correctness of data, are crucial for ensuring proper medical services. This is where blockchain comes in useful, as one of its main advantages is data integrity. When information is recorded and encrypted, it becomes impossible to change or remove.

One of the blockchain approaches that allows for the secure recording and sharing of information is anchoring data to the public blockchain. This method involves generating a proof of data integrity. Using this proof, any user can verify the data timestamp without the need to rely on third-parties. This method allows users to:

· Verify PHI integrity;

· Perform unchangeable medical audits;

· Prove the integrity of clinical research results;

· Reduce audit expenses and ensure regulatory compliance; and,

· Ensure data safety.

HIPAA requires the usage of safe methods of communication between those who deal with PHI stored in electronic form. That is why data encryption plays a crucial role in ensuring data privacy and safety. Our team has a deep expertise in developing digital solutions for the healthcare industry. One of our projects is a HIPAA compliant online communication platform called MDChat that allows patients to securely communicate with medical employees and be sure they are protected from any hacker attacks.

More Secure Standards

Blockchain provides a more secure way to protect data than ordinary encryption. The new technology allows for the implementation of new standards in managing insurance claims, PHI, and medical records. It excludes intermediation in data sharing, when using blockchain. Such consortiums as Hyperledger help increase awareness of the advantages of cryptography and further explain how to use blockchain in healthcare.

According to the survey mentioned above, the main reason why medical organizations hesitate to use blockchain is the lack of knowledge around this technology. A quarter of respondents are still at the stage of education and exploration, which is why responsible state organizations should make the corresponding information more widespread among caregivers. Healthcare providers suppose that this technology must pass several milestones before any adoption is possible, including:

· Technical proof of concept (PoC) (65.4%);

· Security proof (38.5%);

· Privacy proof (34.6%); and,

· Regulatory approval (23.1%).

We can spend a lot of time wondering why caregivers hesitate to implement blockchain in their organization, though the answer is far simpler than it may seem: they simply do not know enough about this technology and its advantages.

Data Transparency

Besides disintermediation, data integrity and provenance, healthcare providers see transparency (55.2%) as one of the top advantages of using blockchain in their industry. To better understand this aspect, let’s consider how it works in the financial sector.

This technology provides a decentralized register of ownership by recording every transaction made through the system. It stores all details starting from the formation of a data block, and ending with any digits related to a specific transaction. Every device that is a part of the system stores a copy of this block. Before making a transaction, the system confirms whether a blockchain version coincides with another in the network. Therefore, each blockchain user can identify the owner of a particular data block at any time. Furthermore, the blockchain is not only a secure way to send money, but a fully protected data sharing method that widens its potential use in healthcare.

Blockchain in Healthcare: Usage

Caregivers feel quite optimistic about fast blockchain implementation, with 37.9% predicting that it will take only five years to adopt it across medical organizations. For now, these organizations and professionals need examples of blockchain, and how it can be helpful in their field. Here, we will cover examples of blockchain use in the healthcare industry, describing existing issues in the sector and considering possible solutions through the use of this technology.

Blockchain in healthcare examples include the following usage issues:

Problem: Drug Traceability

One of the most serious problems in pharmacology is drug counterfeit. According to the Health Research Funding Organization (HRFO), approximately 10%-30% of drugs in developing countries are fake. US businesses lose up to $200 billion annually because of drug counterfeiting; however, the main reason is not in counterfeiting itself, but, rather, that these drugs provide different effects than their traditional medicinal counterparts. They may not help patients at all, or may even be harmful and dangerous to a person’s health.

Blockchain-Based Solution

As all transactions in blockchain are times tamped and immutable, it is easy to detect fraudulent drug dealers. There are two blockchain types: private and public. Trustworthy healthcare blockchain companies have to register their products in the private system to ensure authenticity and the high quality of their medicines. Private blockchains are moderated by central entities, and the fact that a specific producer or distributor has access to the so-called drug blockchain is proof of drug authenticity. This is where blockchain transparency comes in useful. Once a drug is produced and moves from the manufacturer to retailer, the operational data is recorded on the blockchain. It makes it extremely easy to verify the whole path of the drug, and determine all chain links at any time.

Problem: Data Security in Clinical Trials

Clinical trials are used to determine the effectiveness of particular medicines which cure specific diseases. These tests can either prove or disprove an offered hypothesis. During clinical trials, researchers obtain and record a great deal of information concerning statistics, test results, quality reports, etc. Each scientist is responsible for specific research, making it difficult to control everyone. Those data can then be easily modified or hidden in order to change the whole outcome of the research performed. Criminals are interested in recording the results that are beneficial for them, even if the data does not coincide with the reality.

Blockchain-Based Solution

This technology allows users to prove the authenticity of any document registered in the system. It provides proof-of-existence by adding data in the form of the transaction and validating the information by all system nodes. As mentioned above, blockchain records immutable data. This characteristic will allow for the storage of results from clinical trials in a secure way, making it impossible to modify data. Two doctors from Cambridge University conducted a 2016 study to see how blockchain can provide proof-of existence for clinical trials. They found that comparing a unique data code, which is set by the system, with the original makes it possible to verify whether the data of clinical trials has been modified, thanks to the inner SHA256 calculator which generates a unique hash every time a modification is made to the data.

Problem: Patient Data Management

Patient data privacy is strictly regulated by the Health Insurance Portability and Accountability Act (HIPAA), and requires PHI to be totally secure. There is, however, another problem related to PHI: sometimes, patients need to share their medical records with third parties (e.g. with pharmacies when they need to buy specific medicines). So, how can blockchain help protect data while providing partial access at the same time?

Blockchain-Based Solution

The Blockchain creates a hash for each PHI block, together with a patient ID. Using an API, covered entities can receive the necessary information without revealing a patient’s identity. In the same way, a patient can decide whom to provide with access and whether this access will be either full or partial. Furthermore, a patient can set specific third parties that would have to give their permission for sharing the PHI, if the patient is not sure in what he or she is doing.

Blockchain has a tremendous potential of use in different industries, including healthcare. This technology has already become widespread in the financial sector, but medical organizations still hesitate to implement it into their IT systems. This does not mean, however, that there are no healthcare companies currently using blockchain. Below, you will find a short list of startups that have made this technology the base of their operational structure.

Blockchain healthcare startups:

· Guardtime (a blockchain-based system for securing patient healthcare records);

· Gem Health (an initiative that promotes blockchain-based collaboration in healthcare);

· Cyph (a platform for building secure digital identities and ensuring protected communication between healthcare providers);

· MedRec (a blockchain-based system for securing medical records management); and,

· Blockchain Health (a blockchain-based system for medical research management).

Blockchain is an effective technology that can help prevent data breaches in the healthcare industry. It is a secure and reliable method of recording, storing, and sharing sensitive data. Caregivers will definitely benefit from implementing this technology, while remaining HIPAA compliant with this method of trustworthy digital protection.