Problems and Opportunities of Blockchain Technologies Implementation in Public Authorities

Abstract

Blockchain is one of the most innovative technologies that is currently used in many areas as part of the spread of web3 technologies. Although the origins of blockchain are linked to the emergence of cryptocurrencies such as Bitcoin, today’s application of blockchain technology focuses on a wider range of issues where trust is required for a large number of transactions. For this reason, many researchers today believe that these technologies have great potential for use in the public sector. The public sector can use these technologies to fulfill its role as a generator of innovation and progress, which is part of its responsibilities, and to modernize projects that will enable citizens to receive the services they need. Therefore, this work aims to determine the main factors of success or failure in the implementation of blockchain technology in public authorities based on the analysis of existing experience in this area, in particular, in EU member states. Blockchain has proven useful for government agencies for several reasons. First, blockchain is a technology characterized by the ability to generate trust in information and processes in a heterogeneous context with a large number of participants and users. Second, blockchain facilitates governance by leaving no traces and acts as a tool to promote transparency, as it allows people to know who did what and when. Third, it eliminates the need for a centralized certificate authority to control access and use of services by large groups of people. Fourth, the successful development of blockchain-based systems can lead to significant cost savings. However, the analysis shows that authorities are not yet ready to widely use and offer blockchain-based services. In many cases, a lack of understanding of the benefits and opportunities, as well as a still unclear interpretation of the legal and regulatory environment, prevent senior executives from making decisions that may involve greater risk. With this in mind, we believe that the implementation of blockchain technology in the public sector can be facilitated by the implementation of blockchain systems as a complement to existing tracking and transparency systems and processes, as well as increasing their efficiency while simultaneously reducing the cost of services provided. This will require the development of adaptive management structures in public institutions aimed at developing reasonable and acceptable solutions to solve real problems.