How Blockchain Technology Could Help Developing Countries Part 13

Blockchains bringing transparency to governments.

 

A classic business principle says that in business it is only possible to improve the things and areas and of business that are measurable. This principle applies perfectly to corruption. If all the evidence is anecdotal, and there are no hard numbers, how can a situation in a country be improved?

Blockchain technology can help the developing countries with both transparency and measurements of virtually everything and anything.

While most people have heard about the technology in connection with cryptocurrencies, mostly Bitcoin, the technology can record all kinds of data. What stays the same is transparency.

For example, with the Bitcoin network, just like with most other public cryptocurrency networks, it is possible to see everything about the network in real time. Here are some examples. When users send transactions on the Bitcoin network, the network broadcasts the transactions to the entire network. These transactions are known as unconfirmed transactions and you can see them as they appear on the network on this page: https://www.blockchain.com/en/btc/unconfirmed-transactions.

Then, miners compile transactions into blocks of the Bitcoin blockchain. You can see the information about the newest blocks that the network has created by the time you are reading this article, here: https://www.blockchain.com/en/explorer.

The information can be divided into two parts. The first part is the information about a block of the blockchain, such as who created in, when, difficulty level of the network that they had to meet and the technical information such as the winning nonce that the miner who created the block discovered and the hash for the block that the miner created.

The second part is the information about transactions, including receiving addresses, amounts of funds, and so on. All this information is available for all the blocks of the blockchain, since Satoshi Nakamoto launched the network in 2009.

Some of the most popular statistics about the network are here: https://www.blockchain.com/en/charts You can see the daily, weekly, monthly and all-time volumes of transactions on the network, transaction fees, and historical technical details about the network such as block size, hash rate, and difficulty. There is also a number of stats of about network activities, including changes in the number of unique wallet addresses, the growth of members of the network, and more.

For governments and countries, this information could be about money and budgets. The department of motor vehicles could be publishing information about renewed licenses and old licenses. The department of buildings could also be publishing information about new projects and renewals. On a blockchain, all the information could be becoming public in real time, and, what’s at least as important, it would be immutable and decentralized, meaning that corrupt officials would not be able to remove it or change it once it becomes a part of the blockchain. This would allow citizens, journalists, and monitoring agencies to be checking for two things: trends within an agency and trends in what agencies are doing in comparison to one another.

For example, if a government agency were to publish all of its contracts, then the prices for all the contracts would be on a blockchain and it would be easy to notice if one year is pays $X per volume unit of concrete and another year it pays $Y. It would be possible to compare the historical prices of concrete and see if the government is paying market prices or if the prices are inflated. Making this information public and allowing people to look at it in a chart form, similar to the charts that exist about Bitcoin’s hashrate, transaction volume, fees on the network and so on, will make it easy to notice irregularities and discrepancies.

For a country, information on a blockchain could exist for municipalities, states, and the federal agencies. This is critically important for yet another reason: that journalists and citizens could then compare the data for different municipalities and states. If the information, say, about construction contracts by the state governments of a country were to become publicly available, then it would become possible to see the differences between the different parts of a country.

If the corrupt officials wanted to make their dealings appear legitimate, they would need to plot how to create and present different contracts in different states so that they appear similar and honest on a blockchain. The version of events in which multiple corrupt officials all over the country collaborate to make shady dealings on a large scale appear legitimate is very unlikely. Even if the corrupt officials were to do that, they’d need to communicate with each other so much to make it work that the enforcement authorities would be able to catch them in the process.