Blockchain for Development: Emerging Opportunities for Mobile, Identity and Aid

"There is hope that the trust, transparency and security offered by blockchain will remove any remaining excuses organisations might have for avoiding collaboration and data-sharing, helping the sector move from an 'organizational focus' to an 'issues focus'."

This report provides short case studies that highlight how four blockchain platforms are being used to: improve people's access to "self-sovereign identities" (Gravity; BanQu), bring new levels of transparency to the distribution of international aid (Disberse), and improve the efficiency of humanitarian cash transfers (World Food Programme (WFP)'s Building Blocks). It was produced by the GSMA Digital Identity Programme, which works with mobile network operators (MNOs), governments, and the development community to demonstrate the opportunities, address the barriers, and highlight the value of mobile as an enabler of digital identification.

The first part of the report offers what is meant to be an uncomplicated, high-level of overview of how blockchain works, highlighting key characteristics of the technology that GSMA thinks make it interesting from a development perspective. Although the technology and cryptography behind blockchain are complicated, the main idea behind it not. Blockchains can be defined as secure platforms "that act as a public ledger, or database, that anyone can access but no single person can control. By providing a decentralised, trustworthy, and immutable record of transactions, the platform allows individuals and institutions to collaborate, transact and share information with previously unheard-of levels of trust and transparency." Blockchains' immutability helps guarantee the integrity of the data stored on the blockchain and allows users to reach a unanimous consensus that every record is authentic and unchanged. Blockchains are are designed to be either public or private.

GSMA points out that early blockchain projects are starting to transform the way people and institutions are able to collaborate, exchange value, share information, track assets, and deliver vital services. Many sectors (governmental, corporate, activist) and domains (benefits payments, medical records, performance rights, food chains, and more) have started to explore the benefits of blockchain-enabled security, veracity, and efficiency in distributed record-making. In refugee contexts, a consortium of humanitarian organisations might use a blockchain to maintain an up-to-date record of the services they are providing to a refugee population, helping to ensure that they aren't duplicating records, wasting valuable resources, or excluding individuals. A blockchain could also be used to help individuals record and protect vital personal information that they don't want a single authority to control and manage, such as their right to land, their educational achievements, or their proof of citizenship. It could be valuable, for instance, for a refugee or displaced person to have their citizenship status and other personal credentials permanently verified and recorded on a blockchain, enabling them to retain control over their vital information in instances of state-based oppression or persecution.

The report next looks at the mobile industry and blockchain, providing examples of MNOs that are investing in blockchain. What follows are indepth case studies highlighting platforms that are in the early stages of development:

• Use case 1: Blockchain and Self-Sovereign Digital Identity - "While Gravity's end-to-end solution uses back-end blockchain technology..., the customer's experience and interaction with the app remains streamlined and easy: users do not need to know what blockchain is in order to use the platform, and the service works on any mobile device through a USSD menu or smartphone application." In addition, through the BanQu platform, "the end user sees every transaction that is stored on the blockchain and maintains ownership of their personal information....When a farmer wishes to access new financial services, BanQu's platform gives banks...the ability to check the identity components as captured in the blockchain, ensuring they are able to fulfil any identity-related regulatory and compliance requirements."
• Use case 2: Blockchain and International Aid Delivery - "Disberse is a fund management platform that aims to make the delivery of development and humanitarian aid more transparent, efficient and effective. Using a permissioned blockchain, they help donors, governments and NGOs [non-governmental organisations] transfer and trace their funds through the whole value chain..."
• Use case 3: Blockchain and Humanitarian Cash Payments - Rather than sending the bank sensitive information on each beneficiary, WFP can create secure profiles for each refugee on Building Blocks, where they only need to record two pieces of information: the refugee's entitlement, and a unique ID number given to each person or family."

For each, the GSMA team sought to answer five core questions:

1. What development challenge does the blockchain platform solve?
2. How is blockchain changing or improving the approach to tackling this challenge?
3. Why was blockchain chosen as the most appropriate technology?
4. What were the main challenges to implementing this platform, and where is there evidence of success?
5. How can the mobile industry add value to this initiative?

The final section, on evaluating blockchain for development, focuses on permissioned blockchains as providing a platform for self-sovereign identity services. The technology enables any individual with a mobile phone to anonymously record and manage their sensitive personal data, while giving the user complete control over how and with whom their information is shared. In contrast to systems where governments or institutions provide ID credentials, self-sovereign IDs are built to empower individuals to control the formalisation of their identity, manage their digital personas, and actively monetise their personal data. Self-sovereign identity systems will require a willingness from global institutions, governments, and other service providers to collaborate and share sensitive information outside of their internal, trusted silos. In short, despite the widely accepted belief that blockchain technologies replace the need for human trust, it is crucial to point out that with permissioned ledgers, the user must still trust the people who designed the application, the platform owners, and the verifiers of data that is recorded on the chain.

GSMA points out that there is still much work to be done to prove that blockchain platforms such as those described in the report are cost-effective, secure, sustainable, and more appropriate than other enabling technologies. Matthew Wilson of GSMA's Digital Identity team opines: "Even though the platforms highlighted in the report are still in the early stages of development, we are encouraged to see opportunities for these (and similar) platforms to enhance the role operators play in the humanitarian and aid delivery spaces - by providing them with new opportunities to support development partners, create new revenue streams, reduce their Know-Your-Customer (KYC) compliance costs and related barriers, and contribute to the UN [United Nations]'s Sustainable Development Goals (SDGs). Like any other enabling technology, we do not expect blockchain to become a silver bullet for every development challenge we face, but it is exciting to see that some use cases are beginning to emerge that blockchain is uniquely qualified to address, and that this new technology is allowing organisations to achieve things that only recently seemed technically infeasible."