Bitcoin Now Acceptable Technology For Government Transactions In Caucasus
Georgia Becomes First Country To Allow Bitcoin Technology For Official Business
The government of Georgia will now use the bitcoin network to validate property-related transactions. This latest development demonstrates that Blockchain, which had been involved in different kinds of criminal activities, is now getting recognized as a technology with great potential for many official applications. Apparently cryptocurrency is starting to become fashionable at many governmental levels. Until now, the tendency has been to pursue private Blockchains (nonpublic data transactions), perhaps because of Bitcoin’s early reputation as being the currency of choice for online drug dealers.
Georgia’s Innovative Step
In 2017 it is the first time a national government has used the Bitcoin Blockchain to secure and validate official actions. Starting this Summer Georgia will become the first country to use use Bitcoin technology for government transactions. Blockchain technology provider Group has announced on Thursday that its Blockchain land-titling project developing with the government of Georgia keeps advancing and will continue to progress this year.
Tea Tsulukiani, Georgia’s Minister of Justice, said in a statement, “We will be able to work with Blockchain technology from this summer [to] place real estate extracts in a totally safe and innovative system.”
The project is already tested and ready to be implemented. In April 2016, the Georgian National Agency of Public Registry (NAPR) entered into a partnership with Bitfury Group and Peruvian economist Hernando De Soto to build and pilot a property registry.
“With this technology, where there is a will, there is a way. And thanks to the forward-looking Georgian government, there is a will. The possibilities for trusted solutions are limitless, and the land-titling project is the first of many creative solutions projects we are developing in concert with the Republic of Georgia and the Blockchain Trust Accelerator to better serve its citizens.” said Bitfury CEO, Valery Vavilov.
Land-Titling Trough Blockchain
Georgia’s property registration systems were ranked third best in the world by the World Bank, which foretells a solid success for future notary products. “We have great confidence that the information coming into the system is valid. They have good controls in place to ensure it’s accurate, that they aren’t going to be registering erroneous data on the Blockchain,” he said.
Currently, to buy or sell land in Georgia you have to physically visit a public registry, which can take a lot of time. By using the Blockchain, the new registry will speed up the registration process thus providing significant time savings. In addition, the process, which earlier cost in the range of $50 – $200, will cost less than 1$.
Additionally, data on Blockchains can be made private or public. In this case, the details of the real estate transactions are placed on a private blockchain network, and then, if requested, that data can be turned into a cryptographic “hash” that’s made public on the Bitcoin Blockchain.
Eventually, Bitfury plans to also help put notary services and smart contracts in Georgia into Blockchains.
What is Blockchain?
Blockchain is a digital ledger in which transactions made in Bitcoin or another cryptocurrency are recorded chronologically and publicly. By allowing digital information to be distributed but not copied, Blockchain technology created the backbone of a new type of internet. A global network of computers uses Blockchain technology to jointly manage the database that records Bitcoin transactions. That is, Bitcoin is managed by its network, and not any one central authority.
As noted, Blockchain technology brings security to real estate transactions because there’s no central point of failure. The ledger is distributed among many computers, so a hacker would need to simultaneously attack at least 51% of the network in order to fraudulently alter records. This means implementation of blockchain brings high security and accountability for users.
Lee Braine, a computer science PhD in the CTO’s office at Barclays explains Blockchain simply: “It’s a way of chunking transactions into a batch, called a block, and then a way of hashing them with the previous block to ensure immutability.”
While many financial institutions are still skeptical about Blochchain and Bitcoin, Post Soviet Georgia leads its way to experiment innovative technological system to secure government transactions with cryptographic means. Especially at a moment when there’s a global crisis of confidence in institutions, implementation of Blockchain technology can be a indication of governments’ commitment to transparency and accountability.