DTA urges cautious approach to blockchain

By Dylan Bushell-Embling
Wednesday, 13 February, 2019

DTA urges cautious approach to blockchain

The Digital Transformation Agency has warned Australian government agencies to take a cautious approach to the use of blockchain in ICT projects, noting that the technology is still at the early stage of development.

The agency has revealed the results of the cross-agency study into blockchain that the government had allocated $700,000 for in the last Budget.

Based on the study, the agency has published a new guide providing an overview of the technology for the Australian Government.

According to the DTA, the discovery team “found that blockchain is still an emerging technology and, when applied to various pilots or considered against alternative technologies, gaps become evident across both the technical and business facets of its implementation”.

As a result, the DTA is advising agencies to focus on the needs of users when considering technical solutions to various problems, and explore whether there are more mature, proven solutions available to meet those needs.

The guidance notes that there is a tendency for blockchain advocates to overlook its limitations, especially around important questions of data governance.

It also asserts that a common misconception about blockchain is that it is a trustless system, noting that users still need to trust the technology itself, the software developers, the dispute mediation process and the behaviour of other users.

Another potential major limitation is that blockchains can only ever be appended, not edited or deleted. This makes it impossible to completely erase any incorrect data in a blockchain.

In addition, any corrections are shared to all users with access, so agencies forced to correct blockchain records could face reputational damage.

But despite the DTA's cautious tone, the guide does recommend that agencies continue to monitor blockchain developments, looking for future chances to enhance service delivery through the use of the technology.

Image credit: ©stock.adobe.com/au/kugelwolf

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