Blockchain is all the rage and now government is interested

By Tom O’Keefe, consultant

Everyone’s piling on blockchain as the hip buzzword of the year. Companies that have inserted blockchain in their name have seen their stock prices rise, and simply mentioning that blockchain is part of your technology can be a surefire way to secure investment from venture capital firms.

And now, the federal government is getting in on blockchain, with a recent NIST draft publication highlighting where and when blockchain could be valuable. And federal agencies are paying attention.

But briefly, what is blockchain? Essentially, blockchain is a way of verifying that something is what it says it is (or what others say it is) due to an unbroken set of links that cannot be modified unless everyone in the chain agrees to a modification. It’s a way for users to have confidence in a system where the rug can’t be pulled out from them by one individual changing something to claim ownership.

It can be invaluable when used properly but is vulnerable if users forget their credentials to access information in the blockchain. It’s also not very useful in a situation where you want to update information in a database of non-sensitive information, as everyone who input information would have to sign off.

The NIST publication notes that organizations tend to gravitate to the latest and greatest technology before its fully proved out. And while blockchain has been proven to work to enable technologies like cryptocurrency, it probably doesn’t need to be involved in many everyday tasks. But federal agencies may find uses for blockchain in a few different ways:

• Developing secure messaging and transfer of information, such that agencies can have confidence that communications are verifiable and not subject to change
• Securing supply chain, especially valuable for software distributors and vendors in mission-critical systems
• Preserving digital records, particularly those that show ownership or can validate identities

There are many more potential uses for blockchain, and the federal government is just starting to explore them. As more companies embrace the technology, leading federal agencies like the Department of Defense, the Department of Homeland Security and the Department of Commerce could be great places to have conversations about this new technology.

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