On May 8, 2018 it was reported that the Dutch Ministry of Economic Affairs and Climate Policy had created a unit tasked with researching the further development of blockchain across technology.
This could represent a major step forward for the adoption and application of blockchain technology as governments are not only taking the new technology seriously with their regulatory work on the cryptocurrency side of things, but now they are actively looking into the benefits of the technology.
Blockchain technology is now on the cusp of a new wave of adoption that is running concurrently, but separately from cryptocurrencies.
The banks are looking as to how blockchain can aid their advancement, racing to be the first-to-market in blockchain and cryptocurrency. Major corporations ar also following suit with their own blockchain products as their own race rages with the likes of Amazon, Microsoft, IBM, and Oracle all trying to outdo one another.
The Dutch blockchain research agenda
The Dutch government’s move into blockchain and viewing its potential was delivered by Rob van Gijzel, ambassador of the Dutch Blockchain Coalition, who presented the national research agenda which was commissioned by the Dutch ministry.
The research agenda will look at three key areas in order to address whether blockchain can be adapted nationwide for the benefit of the country with its potential.
Firstly, they are looking to determine if the trust-less nature of blockchain can be trusted. They want to know if blockchain technology can truly replace legal and social institutions which require trust in individuals and organizations.
Secondly, the government is looking for sustainability. They will be analyzing energy consumption costs, scalability, and resilience against power concentration or hostile takeovers.
Finally, it needs to be determined how the blockchain will be managed and governed.
Because blockchain technology has potentially far reaching implications in its application, governments could use it to streamline and cut costs in varying aspects of society’s needs.
However, like all sectors currently delving into blockchain’s potential, there needs to be a level of experimentation to see if it is indeed suitable and successful enough to do what it says it can.
It follows that if governments can find a path towards using blockchain successfully, they could well be a large sector that could speed up adoption of the revolutionary technology.
Following banks and businesses
While there are less corporate pressures and capitalist competition at the government level, there is still an obligation and a focus to conduct government business efficiently as part of their mandate towards their citizens. That is why it is understandable that the Dutch government, among others, are looking into new competitive technologies as blockchain.
However, their drive to expand the possibilities of the technology could be considered the latest push in adoption, making it the third prong, following from banks and businesses who are in an ‘arms race’ to be first-to-market with blockchain products.
Looking at the private sector, Banks are not only rushing to try and get crypto trading desks out to their customers, they are also looking at what blockchain technology can do internally for their own processes. Strong banking rivals Morgan Stanley and Goldman Sachs are building and experimenting with blockchain to get a working product out to market first – a long way from when the likes of Jamie Dimon and others were calling it a fraud.
Even Microsoft, Amazon, and other major corporations – who are traditionally centralized powerhouses – are looking to branch out into the decentralized world and offer products that go strongly against the corporate mandate of capitalization and monopoly. There is building evidence from the banking sector and corporations that blockchain can be the next wave of technology so it is important to be ahead of the curve, hence the competition between these other sectors.
When governments begin looking at new ways in which to conduct business, they do not have the same corporate competition as these organizations in the private sector, but the push and drive from those sectors must be noticed. Governments, such as the Dutch, with their research agenda, show that even these leaders of countries are also looking at the potential blockchain can bring with its promises of transparency, efficiency and cost-effectiveness.
The Dutch, however, are not the only ones that have started looking into what the blockchain can do at this level. There are a lot of driving forces in different nations wanting their governments to take note of the future.
For example, the UK government has heard British MPs raising the question of the role nation states have in setting frameworks for decentralized, cross-border systems that blockchains enable. Furthermore, and more directed at the cryptocurrency side of things, the UK also set up a cryptocurrency task force in order to determine the best route for regulation.
Even China, with its hard-line approach to Bitcoin, is still noticing that blockchain technology can have an important role to play in the future. On May 10, the Chinese government released ‘blockchain standards’ in order to advance nationwide development of the blockchain industry by the end of 2019.
South Africa has set up a ‘sandbox’ through its central bank in which certain companies and businesses can operate with less stringent regulations in order to grow the blockchain environment in the African country with the government keeping a close eye on what emerges from it.
Another avenue of adoption
Considering that Bitcoin, cryptocurrencies, and even blockchain technology were being scoffed at no more than a year ago as ‘rat poison’, and ‘pixie-dust’, the way in which it is being viewed a few months down the line is a staggering turnaround.
Banks, once seen as Bitcoin’s biggest enemy, are now hiring blockchain experts by the dozens; corporations that have always traditionally been at the top of their game are now looking to breakdown and decentralize because they know that is where the next wave of industry will be.
Now it is governments who are legitimizing the power of blockchain as their best and brightest explore this latest technology, and implement its uses to make society more efficient, streamlined, and advanced.