US Treasury To Track Asset Transfers On A Distributed Ledger
In combination with a parallel robotics initiative, a recently announced pilot program from the Bureau of the Fiscal Service’s Office of Financial Innovation and Transformation (FIT) will seek to bring the US federal government up to speed with the latest advancements in distributed ledger technology (DLT).
John Hill, the assistant commissioner of FIT stated, “There are many exciting innovations coming out of the commercial sector that can be applied to federal financial management. I hope that these two pilot projects identify the opportunities where the innovations will have the most impact on efficiency, accountability and customer service.”
FIT’s DLT initiative has enlisted the expertise of “a contractor to develop a prototype using blockchain, or distributed ledger technology, to track and manage physical assets (for example, computers, cell phones, and the like.)”
Although it remains unknown which development contractor is building the system, the hope is that DLT will be able to decrease bureaucracy and increase efficiency across a swath of internal government processes, especially asset tracking. The system will continuously monitor and reconcile, in real time, the transfer of physical assets from person to person during pilot testing. This could have profound implications for strengthening government accountability and cutting down on mountains of paperwork.
Other use cases are expected to be identified during the testing phase of these initiatives and, per the Treasury Department’s website, “evaluated to better understand how the government can use this technology to improve the way it manages the government’s finances.”
The push to introduce new efficiency inducing technologies like distributed ledgers represents an acknowledgment by the US Treasury that the potential of blockchain for “streamlining burdensome reconciliation operations involved in many financial processes” is great. This is in line with FIT’s mission to identify and promote innovative solutions to improve financial management on a federal level.