KUALA LUMPUR (Dec 24): Governments worldwide have been trialling blockchain initiatives as transparent and secure solutions for transactions or digital interactions.
In a statement on Wednesday (Dec 22), technology research and consulting firm Gartner Inc said that by using blockchain technology, governments can permanently store asset data and transactions pertaining to land, property, businesses and vehicles on a public ledger, guaranteeing data integrity and high levels of security.
Gartner predicted that by 2021, at least 5% of government entities would adopt blockchain technology as a transparent, authoritative ledger for some official records.
It said several blockchain-based registers had moved into large-scale piloting or even production, such as the Verifiable Organizations Network business register in Canada, or the land and real estate registers in the country of Georgia and India’s state of Telangana.
Prior to this year, there were far more public-sector blockchain projects in pilot or proof of concept (POC) than implemented into production or in production, according to Gartner’s 2020 survey of blockchain consultancy and technical service providers.
It said that in 2021, the bulk of government initiatives (73%) were in an exploration or piloting phase with uncertain outcomes, according to a sample of 87 government projects.
It said this is because some blockchain initiatives are less efficient or effective in getting to an outcome when compared to alternative technologies or approaches.
In addition, public blockchain technologies are diverse and most of them are still insufficiently mature.
Gartner’s Hype Cycle for Blockchain 2021 report showed that 70% of technologies listed were still at or before the peak of hype.
The firm suggested that to get projects moving, try to reduce the pressure to deliver tangible results by setting initial expectations deliberately low.
Gartner director analyst Arthur Mickoleit said this is true, especially for governments with less of a track record in this area.
“It is better to underpromise and potentially overdeliver, considering that most public-sector blockchain initiatives today still serve exploration and capacity building,” he said.
Mickoleit added that government leaders must be realistic about the largely uncertain outcomes of their blockchain projects.
“Focusing on pragmatic blockchain use cases means identifying use cases that have the greatest chances of taking a blockchain project beyond the POC phase.
“Success also requires exploring alliances to extract long-term value from blockchain engagement,” he said.