Blockchain technology emerged alongside Bitcoin, the cryptocurrency powering digital payments through a peer-to-peer system, currency trading and even, in some cases, black-market transactions. Now, some United Nations agencies are using blockchain to provide basic identification to refugees and others in developing countries as well as for specific actions like helping refugees obtain food rations in UN camps. More broadly, the use of blockchain could improve the efficiency of UN agencies, satisfying donors along the way.
As the name suggests, a blockchain is a series of blocks of information containing anything from financial transactions to personal identities. They can also store things like health care information or votes. The entries are strung together as they occur, so that each piece of information links to the ones before and after it. In addition, everyone on the blockchain has a copy of every transaction, therefore helping to prevent fraudulent changes to any singular block.
Blockchains are considered advantageous because they are decentralized. In a traditional ledger, an entity must moderate the transaction. For example, when you wire money to a person or other source, it must go through a bank or an institutional means before it reaches the recipient. But on a blockchain, middlemen are cut out, making transactions more efficient and accurate. Banks such as JPMorgan Chase are developing private blockchains to improve internal operations.
Yet because Bitcoin works on a blockchain, no bank can moderate transactions, and crimes like human trafficking and money laundering become harder to track. Users who engage in transactions on a blockchain create a code — a long number key that serves as their digital signature. If criminals are careless and reveal their key, their identity — and criminal history — are readily available for investigators. Researchers and law enforcement agencies are also figuring out ways to track the IP address of the buyer or seller to a specific computer and location.
Despite the dominant incarnation of its current use, blockchain technology can be used to promote social good, its proponents say. According to the World Bank, approximately 1.1 billion people cannot prove their identity for a wide range of reasons, leaving them stateless and powerless. This problem disproportionately affects women and children in developing countries in Africa and Asia.
Atefeh Riazi, the UN assistant secretary-general and chief information technology officer, is no stranger to blockchain technology. Speaking to humanitarians and students at the Institute for Humanitarian Affairs at Fordham University last year, Riazi highlighted how a lack of identity hinders human rights.
“What are the implications when you don’t know how old you are?” Riazi said to the audience. “You can be drafted to military as a kid, you can be tried as an adult when you’re a child, you could be trafficked and nobody cares, nobody knows who you are. You could get married at age 9 or 10, when people think — or want to think — you’re 15. And most of the people impacted by lack of identity are girls and women.”
Some policymakers and innovators see blockchain technology as a way to solve such problems. ID2020 Alliance is a nonprofit organization financed by Accenture and the Rockefeller Foundation that brings together public and private sectors to create legal identities for people who lack them. At ID2020’s second annual conference, held at the UN last June, attendees talked of using blockchain and biometric technologies to give everyone in the world an identity. This includes “the last girl” — the person in the world whose situation is so bleak that the chances of her getting a legal identity are nearly impossible.
At the conference, Microsoft and Accenture unveiled a new tool that combines blockchain and biometric data, such as retina scans and fingerprints, to give people access to their identity records anywhere, anytime. One major recipient of this technology would be refugees, who could gain access to their passport and other documents, even if the hard copies were destroyed or lost. Although the tool has yet to be deployed, refugees are already benefiting from blockchain technology.
The World Food Program, for example, started piloting “Building Blocks” last year. Up to 10,000 Syrian refugees in the Azraq camp in Jordan pay for their food using entitlements recorded on a blockchain system. Instead of using cash, vouchers or cards, refugees buy food using a retina scan. The system relies on biometric data registered with the UN High Commissioner for Refugees. The program was scheduled to end on May 31, 2017, but has been extended indefinitely.
“Digital cash and blockchain allow refugees to buy locally, helping them and the local economy,” Riazi said at the Fordham program. “It puts us in a different position by making us a catalyst. Blockchain can allow refugees to easily retrieve all their information such as their passport, birth certificate, diplomas, and other critical documents.”
Blockchain, she added, “will have a tremendous impact on our economy, financial markets, supply chain and identity while helping to reduce fraud and laundering.”
Blockchain technology’s uses are just beginning to be explored by other UN agencies. UN Women recently announced its own pilot program for cash transfers and identity powered by blockchain, directed toward women and girls in humanitarian-crisis settings, like natural disasters and wars.
As Yannick Glemarec, deputy executive director of UN Women, said at the agency’s announcement on blockchain technology, “Digital technologies can provide unprecedented solutions to address the fundamental needs of marginalized groups and those at the bottom of the pyramid.”