The state began its deep dive into blockchain last summer with the formation of a working group, and its effort grew quickly following a Request for Information late last year that yielded 20 industry responses suggesting potential use cases.
Blockchain, the encrypted digital recording of a transaction or an event through a shared “incorruptible” ledger, hasn’t yet found wide use among governments, although states including Illinois, Delaware and New Jersey have expressed interest in the technology. And in May, the National Association of State Chief Information Officers (NASCIO) added blockchain to a list of the “next big, transformational technologies.”
Illinois is utilizing what the state CIO referred to as a “three-pronged approach” centered on economic development, establishing a single liaison point in its Department of Commerce and Economic Opportunity; collaboration between government and the private and academic sectors; and comprehending its application in government.
Since May, Illinois has had to regroup its six pilots by priority, Bhatt said, with the goal of effectively managing resources as the state works through an ongoing complete digital transformation. Its current Priority 1 pilots are:
- A health provider network in the works with the state Department of Financial and Professional Regulations (DFPR). In May, Jennifer O’Rourke, business liaison for the Illinois Blockchain Initiative, told Government Technology that blockchain could let residents do things like check their doctor’s licenses and insurance through an app. This pilot is in the requirement and solution definitions phase.
- Tracking continuing education credentials with DFPR and the University of Illinois.
- Defining a use case around digital identity with the Department of Health, examining questions including how one claims against that, and how birth or other vital records information could be documented using blockchain.
“I will not be surprised if these proofs of concept could be a one-time proof of concept and may not get further developed on the same technology platform or using the same technology, and we may come up with a complete new RFP if we think that this has legs,” he told Government Technology. “While we say that it is a proof of concept, we are taking it very seriously because it’s testing out a completely new technology.”
Priority 2 pilots are:
- A property title transfer underway with Cook County, the state’s largest county.
- A use case on the recording of academic credentialing, in the works with public universities.
- Tracking Renewable Energy Credits, which are generated by creating 1 Megawatt-hour of electricity through wind turbines or solar panels, to follow trades in secondary and tertiary markets and eventual retirements.
"It's not a trivial task," Bhatt said, indicating he wants to ensure the state's digital modernization and pilots share resources including managers. "That's mainly why we put them on Priority 2. I think as soon as we feel that one of these projects is now on autopilot, we can move on to the next one."
Illinois has four general goals in mind, the CIO said: determine whether blockchain really is a good fit for government; whether it can help achieve increased efficiency; whether it can help achieve increased effectiveness; and whether it can improve citizens’ relationships with government.
“I’m hoping if we can prove it out, we can be helpful to other governments with our lessons learned,” Bhatt said, noting that he attracted interest from other CIOs with a presentation that mentioned blockchain at a recent NASCIO event.
And one way the CIO is getting word out about the state's forays into blockchain is through a conversation with New Jersey Chief Technology Officer Dave Weinstein on an episode of the TechNJ podcast series.
Produced by the New Jersey Office of Information Technology (NJOIT), Weinstein said the series is an ideal venue for the discussion because it’s intended not just to promote his state’s technology work but as a “convening authority for thought leadership on technological issues” that intersect its mission and that of other “client agencies” in the state.
Weinstein praised Illinois as one of the few states “that have leaned forward in this space,” an area many already understand they should prepare to inhabit “at some point during the next decade.”
He said New Jersey is interested in blockchain as well, and officials are evaluating use cases across the enterprise that involve citizens interacting with state-managed databases to identify ways to increase efficiency and security.
“This goes hand-in-hand with the broader discussion around automation and the opportunities that will present themselves over the next five to 10 years to reduce the size of government, to be a little leaner in the interest of improving the customer experience,” Weinstein told Government Technology.
The technology has obvious potential to reduce fraud, he said, but could also eliminate or reduce mistakes that are the inevitable result of human interaction.
In the podcast, Weinstein said he sees blockchain as being roughly “where security intersects with trust,” and already deploying “fairly maturely” in industries like financial services and fintech.
Bhatt said in the podcast that he views blockchain in its simplest terms as “how you transact between two parties in a very secure manner.” He also called it “a foundational technology that is poised to disrupt how we do transactions in our economy and in our society.”
He and Weinstein demurred on the question of what the recent Bitcoin split and the creation of the new cryptocurrency Bitcoin Cash mean for blockchain, which records Bitcoin transactions.
Weinstein did, however, note that other blockchains have already emerged, though none operate at such a scale yet.
“That gets to an earlier point — that I think it’s incumbent upon us in the technology field to remove some of the mysticism about blockchain," Weinstein said, pronouncing himself “less interested in the exchanges and more interested in how the technology itself can be applied to infrastructure and government.”
Reiterating that Illinois remains in the exploratory stage, Bhatt said it’s too soon to determine whether blockchain could play a specific role in his state’s ongoing digital transformation. But early indications show it’s here to stay, he said.
“I don’t think government will be the driving force behind full adoption of this. Government will be a player in the overall game," he added. "The financial industry, the insurance industry and others are going to play a major role in this as well. It will continue to be a team sport when it comes to it being adopted by industry."
