Blockchain Blueprint: Government Approach towards Cost-Effective Solution

Blockchain technology is renowned for its ability to provide transparency, immutability, and security for data shared among departments, thereby enhancing efficiency for both departments and citizens. However, the challenge is that many departments might need their own blockchain networks, which can be costly

So, how can a blockchain network be designed to ensure both cost-efficiency and ease of implementation?

In this blog, I will explain how the government is considering implementing blockchain technology, either at the state level or centrally, to address these concerns.

Implementation Background

The government is planning for Blockchain Service Platform within an e-Governance framework to improve the security and integrity of government data and documents. This platform will provide a statewide or Central wise distributed ledger infrastructure, enhancing the security and efficiency of government systems. Departments or participants that can't host a node will connect through an API Gateway for broad access.

The platform aims to help develop transparent, efficient, and secure applications for citizen and business services. It will support enterprise-grade applications for government-to-government, government-to-citizen, and, if needed, government-to-business interactions, improving ease of living and doing business. It will also integrate with existing e-Governance systems.

Featuring a cryptographically secured, immutable ledger and peer-to-peer networking, the platform will allow for secure data and document verification. It will also support smart contract-enabled workflows for efficient and automated processes. The platform will provide a trusted foundation for secure government processes across various areas like agriculture, land records, public distribution, benefits tracking, data integrity, and healthcare. It will serve as a BaaS provider, allowing departments that don't want to host a node to connect via the API Gateway.

Blockchain Service Platform Parameters

1. Blockchain Platform: Private Permissioned Blockchain
2. Blockchain Version: Hyperledger Fabric 2.5
3. Hosting Infra: Public cloud or Government Data Centre
4. Users: Government officers, Citizens & other external and internal stakeholders as required by department
5. Network Custodian: Government IT department
6. Platform Architecture: Microservices
7. Security: Private Ledger and Privacy First
8. Regulations: Adhere to Government rules, Auditing

Blockchain Service Platform Components

1. User Interface : The Blockchain Backbone Infrastructure will feature a comprehensive operation and administration dashboard for effective platform management. Users, including both citizens and government employees, will access blockchain applications through user-friendly interfaces available on smartphones and web browsers, tailored to specific business needs. These interfaces will be integrated with a strong authentication system that logs all authentication activities, including successful and failed attempts. Additionally, successful logins should trigger detailed records of user activities for transparency and accountability.
2. API Gateway: The API Gateway will enable authorized parties to access and interact with the shared ledger, handling the collection, processing, signing, and verification of workflow requests before forwarding them to the blockchain core layer. It will ensure that only authenticated and valid requestors can access the services provided.
3. Business Layer: The Business Adaptor Layer will feature a set of plug-and-play modules that manage business logic, off-chain databases, and workflows outside the blockchain. This layer will handle incoming requests from client applications or the API Gateway, perform necessary off-chain operations, and then pass requests to the blockchain layer for transaction execution or data retrieval. The modules will be designed for integration with both legacy systems and new blockchain applications, ensuring scalability and efficient request management through appropriate queuing protocols to minimize latency.
4. Blockchain Core Layer: The Blockchain Core Layer will function as a distributed state machine, managing the immutable ledger and interfacing with the Business Adaptor Layer. It will utilize a reliable consensus algorithm to maintain data integrity across the network and counteract any attempts at data tampering. Digital signing and authentication processes will be based on established cryptographic methods. The core design will also consider future technological advancements and potential threats to ensure ongoing security and adaptability.

Use Blockchain Service Platform by Departments

In this example, the Land Registration department connects with the State IT department to utilize the Blockchain Service Platform for the issuance and verification of land registration certificates. The process begins with the Land Registration department reaching out to the State IT department to submit their requirements. Following this, the IT department host nodes specifically for the Land Registration department and deploys a smart contract based on the agreed terms and conditions. Once the smart contract is deployed, the IT department provides an API that the Land Registration department will use to integrate the blockchain service with their existing application.

1. Initiation Landowner Submission: Landowner submits a request for land registration, providing necessary documents and details to the Land Registration department.

2. Document Verification

Initial Check: Land Registration department verifies the completeness and accuracy of submitted documents.

API Request: Land Registration department uses Blockchain Service Platform API to create a registration record.

3. Blockchain Record Creation

Document Notarization: API Gateway interacts with the Blockchain Core Layer to notarize the registration document, storing a cryptographic hash of the document on the blockchain.

Transaction Confirmation: The blockchain network validates and records the transaction, creating an immutable ledger entry.

4. Issuance of Registration Document

Generate Certificate: Land Registration department generates a registration certificate based on the notarized record.

Certificate Issuance: The certificate is issued to the landowner, including a reference to the blockchain record for verification.

5. Verification Process

Verification Request: External parties (e.g., other departments, stakeholders) request verification of the registration document through the API Gateway.

Retrieve Blockchain Record: API Gateway retrieves the corresponding blockchain record and verifies the authenticity of the document by comparing the hash values.

6. Confirmation of Verification

Validation Response: API Gateway sends back a response with verification status (valid/invalid) and additional details if required.

Documentation Update: If needed, the Land Registration department updates the document or record based on feedback or new information.

7. Record Management: Ongoing Maintenance: Land Registration department manages and maintains the blockchain records, ensuring updates and corrections are recorded in the blockchain.

8. Audit and Compliance: Blockchain Service Platform provides a transparent audit trail for all transactions, ensuring compliance with regulations and standards.

Blockchain Sandbox

This will be a Government infrastructure that will offer an API sandbox where departments and start-ups can develop and test applications. This controlled environment allows developers to create and host prototypes. Key features of the sandbox include:

• A set of APIs with token-gated access for selected entities.
• Access to specific APIs based on application needs, such as:
• An API for creating new document types.
• A notarizing API for securing documents.
• A verification API for checking documents.

Blockchain Service Platform Onboarding Process

• Identify Key Stakeholders: IT department will verify who will use and be affected by the system, and who needs to support it for successful deployment.
• Interact with Departments: IT department will organize meetings or interviews with departments to understand their needs and expectations for integrating with the blockchain infrastructure.
• Analyze Business Processes: IT department will understand the learn about the client's business processes that the blockchain application will improve or support.
• Define Use Cases: IT department will create user stories detailing how different users will interact with the system, and prepare use cases for each department.
• Establish System Requirements: Identify what the system needs to do (functional requirements) and how it should perform (non-functional requirements like speed, security, and availability).
• Outline System Boundaries: IT department will Determine what the blockchain application will handle and what it will not.
• Define Acceptance Criteria: IT department will set conditions that the system must meet to be accepted by the client.
• Prioritize Requirements: IT department will rank the requirements based on business value and needs to manage them effectively.
• Determine Smart Contract Needs: IT department will check If smart contracts are needed, gather requirements for the rules and conditions governing transactions.
• Identify Interoperability Needs: IT department will collect requirements for how the blockchain application will interact with other systems or data sources.
• Document Requirements: IT department will compile all the gathered information into a formal document, like a requirements specification or business requirements document.

Conclusion

As governments explore the transformative potential of blockchain technology, the promise of enhanced transparency, security, and efficiency becomes increasingly tangible. Implementing a blockchain-based service platform offers a compelling solution for streamlining operations, safeguarding data integrity, and improving interactions between departments and citizens.

By adopting a private permissioned blockchain, such as Hyperledger Fabric, governments can create a robust infrastructure that supports secure data transactions and integrates seamlessly with existing e-Governance systems. The strategic approach to hosting, with options for both public cloud and government data centers, ensures scalability and flexibility while addressing cost concerns.

Key to successful implementation is the establishment of a well-defined onboarding process, involving thorough stakeholder analysis, detailed requirements gathering, and clear use case definitions. The inclusion of an API Gateway and a Blockchain Sandbox further facilitates broad access and innovation, allowing departments and external developers to build and test applications in a controlled environment.

Ultimately, the integration of blockchain technology into government operations not only promises to enhance the efficiency and transparency of public services but also paves the way for more secure and automated processes. As governments continue to refine their blockchain strategies, they stand to gain not only in operational efficiency but also in the trust and satisfaction of their citizens. The journey towards a blockchain-empowered government is both challenging and promising, offering a glimpse into a more efficient and transparent future for public sector operations.