Page 28 - bne_Magazine_October_2017

28 I Cover story bne October 2017
The blockchain
of public record
State Agency for Electronic Government that registered the transaction.
Ukraine’s Justice ministry is also intending to auction off assets seized from its former president and wayward oligarchs using a blockchain and has plans to transfer state property and land registries to the blockchain platform
by the end of the year, deputy minister Serhiy Petukhov said in September.
“We want to make the system of sell- ing seized assets more transparent and secure so that the information there is accessible to everyone, so that there aren’t concerns about possible manipulation,” he said at a briefing.
The public record idea is a popular one that many countries are looking at. Sweden is testing a blockchain-based land registry and Dubai wants distrib- uted ledgers to power its entire govern- ment by 2020. The most active early adopters, however, have been former Soviet republics. Estonia, recognised as a pioneer in e-government, has long-used blockchain-like technologies to secure health records and under- gird its shared government database system, X-Road. “It can be much easier to build a digital society if there are no legacy systems and you can start from scratch,” says Kaspar Korjus, head of Estonia’s e-residency programme.
A blockchain is essentially a “distributed ledger” showing all the members of
a particular network every transaction that was verified on it. The transactions are collected in blocks, which are then secured approximately every 10 minutes in a mathematical process called “mining”, and must be verified by other members in the network before they
are confirmed. The ledger is essentially riskless as there is no central authority and there is no way a malicious third party can tamper with the records.
Vavilov says Bitfury and the Ukrainian government are looking at a number of areas where the technology can
be implemented that include state registers, public services, social security, public health and energy.
bne IntelliNews
Eastern European countries love blockchain. Governments and companies in the region are already experimenting with applications for the technology and could beat the west to developing practical applica- tions if they keep up the current pace.
The most recent initiative was Estonia’s plan to launch its own national crypto- currency, an idea that was immediately slapped down by the European Central Bank (ECB), which pointed out that membership of the Eurozone means you can only use euros as money.
However, further east other govern- ments have made more headway at find- ing useful things to do with a blockchain and several trial projects are underway.
The Bitfury Group, a global company that is a leader in providing technologi- cal solutions based on blockchain, the underlying technology that powers cryptocurrencies like bitcoin, told
bne IntelliNews that it’s working with Ukraine to rolling out the first full-scale “Blockchain eGovernance program.”
A memorandum was signed by the two
www.bne.eu
sides on April 13 that could put
a wide range of government data and services on blockchain systems.
“We believe we have identified suitable pilot projects that will demonstrate the transformative power and unmatched security of our blockchain solutions, and we are looking forward to our partnership with the government of Ukraine,” Valery Vavilov, CEO and co- founder of Bitfury, told bne IntelliNews.
Ukraine’s justice ministry carried out its first trial auctions using blockchain technology on September 6, as part
of an effort to improve transparency in government transactions. And separately Ukraine has just seen the first every real estate transaction where a cryptocurrency was used to buy
a building.
Founder of the popular technology publication TechCrunch Michael Arrington bought an apartment in Kyiv for $60,000, which he used the cryptocurrency Ethereum instead of cash. The deal was possible thanks to an agreement with the new Ukrainian