Horrified by reports that the Russians might have hacked voting machines and the fact that one county lost a high number of voter records in 2016, New York Assemblyman Clyde Vanel introduced four bills this past week to prevent this from ever happening in the state.
“In 2016, Kings County lost 120,000 voter records,” Vanel said. “I felt we needed to secure and safeguard our election system. I wondered if blockchain (technology) was the solution.”
According to blog post written by Vanel, blockchain technology is “a continuously growing list of records, called blocks, which are linked and secured using cryptography. Each block of information contains a pointer to the previous block of information that represents a transaction of data. By design, these blockchains are resistant to the modification of the data. Additionally, this information can be used on a distributed ledger that is managed by a peer-to-peer network that makes it virtually impossible to hack.”
Because the uses of blockchain technology are largely untested in government records keeping, Vanel introduced three bills to study the technology and the effects it would have on securing voting records, election results and government record storage. Another bill would create a digital currency taskforce to analyze the impact of cryptocurrencies on New York financial markets.
A fourth bill would amend the state’s technology law to include a definition of blockchain technology, smart contracts and provide a legal understanding for digital signatures stored on a blockchain.
“We can’t be too quick to regulate (blockchain), we need to understand it first,” and how it might enhance “record keeping in government,” he said.
Vanel convinced a bi-partisan group of legislators to co-sponsor the bill, including, Rep. Ed Ra, R-Nassau County; and Rep. Luis Sepulveda, D-Bronx; and Rep. Ron Kim, D-Whitestone.
Rep. Kim was positively adamant about the potential of the technology to push the state into the future. “Blockchain excites me,” he said. “This is a game changer … Imagine five years from now we might be able to pick up a cellphone and register to vote or send health records instantaneously. New York must be in the forefront of this.”
Four other states have made similar moves this year by introducing legislation to study blockchain. Illinois, Hawaii, Maine and North Dakota have all passed laws that direct state government to find out how blockchain technology can enhance record keeping.
“What are the opportunities and the risks of using this technology,” said Irakli Mirzashvili, a tax analyst with the tax policy division of the Texas Comptroller of Public Accounts, adding that his views on blockchain do not reflect the views of the Texas Comptroller.
Other states will look on with interest to see what these diverse states find worthy of adoption, he said. Their exploration of blockchain uses in government will answer difficult questions for legislators throughout the country.
A survey conducted last winter found that those government leaders and business executives who understand blockchain have big plans for its implementation in the not-too-distant future.
Mirzashvili said there should also be interest in the results of a New York inquiry into cryptocurrencies and how that will affect the state’s financial markets.
“New York has a real stake in understanding the effect on an industry,” he said. The state’s financial markets employ 1.5 million people and it comprises 35 percent of Manhattan’s economy. “No other state has a mandate like this,” but, he said, “other states will be interested to see what the task force finds out and consider how it might affect them.”
Mirzashvili points out that New York is not a latecomer to the bitcoin arena. “It has been on the forefront of bitcoin regulation.” In 2015 the state passed a bill to authorize regulation of companies who are actively engaged in bitcoin. Called a BitLicense, the state charges companies a fee to operate in cryptocurrencies.
In a similar move, he said, Delaware lawmakers recently passed a law in August that lets corporations maintain shareholder lists, along with other corporate records, using the technology.
“The legislation is part of the state's effort to promote the use of blockchain via the Delaware Blockchain Initiative, a joint venture between the state and a blockchain provider,” he said. Delaware is regarded as the incorporation capital of the United States with over 1 million business entities created in the state.
“I wouldn’t be surprised if we see more activity along these lines (throughout the United States).”
Elizabeth Zima is a former staff writer for Government Technology. She has written in depth on topics including health care, clinical science, physician relations and hospital communications.