Why the Time Is Right for the First Blockchain Governor

Alec Ross was a senior advisor for innovation to former Secretary of State Hillary Clinton and is the author of "Industries of the Future." He is now seeking the Democratic party's nomination for governor of Maryland.

I'm running for governor. And I believe in the blockchain.

Those are two sentences that you've probably never seen together. And that is a big fail for the public sector.

Harnessing the potential of blockchain technologies for government and public service ought to be as common sense as embracing innovation in clean energy and lifesaving biomedicine.

But we're not there yet. I'm on a mission to change that.

I'm a Democratic candidate for governor in the state of Maryland - a state that leads in technology and innovation on the edge of the nation's capital. I've spent my career moving back and forth between public service and technology entrepreneurship.

I've been following blockchain and the rise of distributed ledger technologies for years, and I profiled them in my book, Industries of the Future, to reach a wider audience.

Now I want to bring the transformative power of blockchain into public service. While I admire the early efforts of states like Delaware and Illinois to experiment with blockchain, I believe that the Old Line State - ironically, given its nickname - has the capacity to take blockchain innovation to a whole new level.

I want to make Maryland the state that shows governments around the country and the world how to foster blockchain businesses and apply blockchain benefits to government itself.
Fertile ground for blockchain

On fostering blockchain businesses, consider the leading industries in our state:

Biohealth and life sciences
IT and cybersecurity
Advanced manufacturing
Military and federal government
Aerospace and defense
Financial services
Energy and sustainability
Agribusiness

These are ready-made for a major wave of blockchain applications.

We can leverage powerful public-private partnerships, R&D funding, and public-sector programs to stoke development in sector-specific blockchain technologies.

We can also leverage Maryland's world-class university system to create a pipeline of blockchain talent to fill these jobs of the future. We can make Maryland the go-to place for blockchain companies to pilot new products and launch new business models.

On applying blockchain to government, I believe that the fundamental value propositions of blockchain - security, integrity, and authentication of information - are central to the business of our public institutions.

Government is the trusted keeper of the records that make our society work - from birth to death certificates, from education to healthcare, from business licenses to construction permits, from tax returns to court judgments and much more.

For generations, states have performed the basic functions of authenticating records of identity and ownership and verifying transactions, permissions, and the value of assets the old fashioned way - with ink stamps on paper. This system enabled fraud, corruption, errors, and a lack of transparency that often left citizens wondering whether government systems served them or the other way around.

Blockchain gives us the chance to change how we handle the power to document, verify, and hold the information that instills trust in society. It gives us the chance to democratize that power, to make it perfectly transparent, and to reduce transaction costs.

As state governments go, Maryland has a decent reputation for using technology. We've got the right institutions and many talented, tech-savvy public-sector employees. What we need is a big push from leadership for Maryland to be audacious and experimental with blockchain - and that's where we're going next.

I've stood with one foot in tech and the other in government for a long time. When I served at the State Department, I led the implementation of digital technologies in American diplomacy. It was rapid, disruptive, and transformative. And it worked.
State use cases

My vision for state government starts with these priorities:

Protecting information. Government is the most important holder of personal data in our society. After a series of high profile data breaches, public concerns over data privacy and data integrity are at an all-time high. Blockchain offers reliable means of protecting citizens' records where the management of those records is transparent but their contents remain private. Marylanders care about the security of their data. That's why the state updated its data breach notification laws last year. But we haven't begun to bring a secure alternative into play yet. That's what's next.
Registering assets. Maintaining a record of property rights is a critical public service. Land registries, real estate deeds, and car titles are among the documents that protect the value of our assets. Blockchain offers a convenient, low-cost method to maintain a secure public record of these assets that is both universally accessible and perfectly immutable. Every Marylander who has ever waited in line at a state agency to have a form stamped deserves better, and we can make that happen.
Certifying transactions. Among government's highest responsibilities is the handling public tax dollars. Too often it is marred with fraud, waste, and mismanagement. We need to apply blockchain solutions to track how public money is spent. Through distributed ledger technology, every dollar spent in every contract for procurement of goods and services will generate a clear and transparent audit trail. We can notarize documents and private sector contracts. And we can eliminate our government's reputation for shady deals behind closed doors.
Monitoring compliance. A system that certifies transactions will have myriad uses in the regulatory and justice arenas as well. For example, we can use it to track the market for regulated, taxed marijuana from seed to sale. We can use it to log the chain of custody of evidence in court.
Verifying identity. Government establishes a record of all citizens' identities, and citizens access public services based on verification of those identifications -- from schools to hospitals to voting. With blockchain, Maryland can make identify verification secure, portable, and paperless. Secure identity services on the blockchain deliver peace of mind to citizens as they make public services seamless to request and receive, not to mention cheaper to deliver.

Gradual evolution

Starting the blockchain revolution in government does not mean we are going to replace all our existing institutions. We are going to use blockchain alternatives to enhance current practices and strengthen their integrity, and create a pathway to fundamental change.

We don't need to jump directly into a permissionless, anonymized blockchain environment. We can move first to controlled systems where the master ledger and authentication functions are stewarded by a trusted government agency designed for and tasked with that purpose.

The technologies government needs to institute blockchain-based services are already available, and citizens already have the right tools to access these services: smartphones and PCs. For most government applications, the scale of use that we might hope to achieve is already well tested in commercial markets.

In short, we have no technical impediments to progress. It is just a matter of political will.