Blockchains have the potential to help address trust gaps that currently exist between citizens and governments. By providing immutable, transparent records of transactions and information, blockchains could reduce costs, time, and risks associated with intermediaries, while boosting trust. However, regulators face challenges in developing strategies for how to govern blockchain technologies, including whether to regulate users, producers, or miners, and determining the appropriate level of decentralization versus security. Shifting to a more collaborative, post-facto regulatory approach that promotes innovation could help governments integrate blockchains while addressing concerns over issues like energy use and reversibility of transactions.

1. BLOCKCHAIN & GOVERNMENT
Marco Torregrossa | @ Apolitical, June 14 2018

3. 1400s
Knowledge
Gap
Power
Gap
1800s
1900s
Distance
Gap
Next
Gap?
2000s

4. TRUST
GAP

5. Trust is Disrupted
52 54
49 51
40
35
40 37
NGOs Business Media Government
Distrusted
Neutral
(50%)
Trusted
Edelman Trust Barometer Pre- and Post- US Election, 2016
2 2 5 3

6. Intermediaries
COSTS
TIME
RISK
TRUST
GAP

7. Blockchains
LESS
COSTS
LESS
TIME
LESS
RISK
TRUST
GAP

9. Builder 1 Sold to Owner 1 1977
Owner 2 20K Improvement 1981
Architect 3 Approved Extension 1983
Real Estate 4 Sold to Owner 2 1989
Government 5 Failed Chimney Inspection 1998
Real Estate 6 Sold to Owner 3 2005
Contractor 7 50K Investment 2009
Insurance 8 Electrical Fire 2013
Database

10. Builder 1 Sold to Owner 1 1977
Owner 2 20K Improvement 1981
Architect 3 Approved Extension 1983
Real Estate 4 Sold to Owner 2 1989
Real Estate 5 Sold to Owner 3 2005
Contractor 6 50K Investment 2009
Insurance 7 Electrical Fire 2013
Tamper-able

11. Builder 1 Sold to Owner 1 1977
Owner 2 20K Improvement 1981
Architect 3 Approved Extension 1983
Real Estate 4 Sold to Owner 2 1989
Government 5 Failed Chimney Inspection 1998
Real Estate 6 Sold to Owner 3 2005
Contractor 7 50K Investment 2009
Insurance 8 Electrical Fire 2013
Immutable Blockchain Database

14. Which Segments to Regulate?
REGULATE USERS
Make it illegal to transact with specific smart contracts
REGULATE PRODUCERS
Force them to implement specific backdoors or kill-switches
REGULATE MINERS
Pressure them to ignore certain transactions or alter balances

15. What’s Your Goal?
PUBLIC BLOCKCHAIN
Decentralization
Transparency
Proof of Work
Low Trust in Gov.
Blockchain Tool
PRIVATE BLOCKCHAIN
Security
Efficiency
Proof of Stake
High Trust in Gov.
Enhanced eGovernment Tool

16. Shift in Regulatory Mindset
REGULATION 1.0
BEFORE THE FACT
Bureaucracy
Friction
Permission
Laws
REGULATION 2.0
AFTER THE FACT
Transparency
Accountability
Innovation
Governance

17. What Keeps Regulators Up at Night
Technology is not there yet
Energy used is unsustainable
Inability to reverse a transaction
Inadequate incentives for mass collaboration
Instability of blockchain startups
Lack of technologists in governments
Legal enforceability of smart contracts
Measure economic activity on blockchain
Jobs destruction vs jobs creation
Criminals may use it
Which choice of law and jurisdiction
Lack of standards (privacy, security)
Adoption by average Joe
Some still benefit from inefficiency

18. What Governments Could Do
EDUCATE YOURSELF AND OTHERS
Launch a task force to monitor developments
DEVELOP A STRATEGY AND PROMOTE REGULATORY SANDBOXES
Include blockchain in your innovation agendas, develop benchmarks
INVEST
Grants, tax incentives, intelligent public procurement
LAUNCH OR SUPPORT PILOTS
Scan and prioritize opportunities, selects the right partners for implementation
FIND EARLY ADOPTER CITIZENS
Test, review, rinse and repeat

19. Marco Torregrossa
about.me/marcotorregrossa | @MarcoTorreg

20. Alex Tapscott, Blockchain Research Institute, Global State of Crypto: Crypto Summit 2018
Jeremy Epstein, Never Stop Marketing, Marketing in the Age of Blockchain
Primavera de Filippi, Harvard University, Distributed Ledger Technology Beyond Financial Applications
Richie Etwaru, TEDxMorristown
Matteo Giampietro Zago, 50+ Examples of How Blockchains are Taking Over the World
Will blockchain transform the public sector? Deloitte analysis with the Fletcher School Tufts
University
Sources