GAO’s goal is to assist policymakers, such as Congress, federal agencies, state and local governments, in implementing blockchain in a seamless manner.
The US Government Accountability Office (GAO) brought forth four policy proposals to assist policymakers use blockchain technology while improving advantages and limiting problems, in response to a request from the US Congress.
Despite noting concerns about bringing new obstacles while attempting to fix issues linked to traditional systems, the GAO’s technology evaluation noted the potential of blockchain technology in enhancing a range of financial and non-financial applications:
By making title registration simpler and more trustworthy, a blockchain might simultaneously enhance the speed of a title registry system and cut the cost of title insurance.
Uncertain benefits, data dependability, and legal compliance are among the problems identified in the study.
GAO hopes to use the flowchart above to assist policymakers, such as Congress, federal agencies, state and local governments, academic and research organizations, and business, in determining if blockchain deployment is required.
The GAO report also highlighted a number of non-financial uses of blockchain technology, as indicated below.
While policymakers have the right to keep things as they are, the GAO suggested four policy choices to help with the decision-making process that goes into mainstream blockchain adoption: standards, oversight, instructional materials, and appropriate applications.
GAO hopes to address issues such as interoperability and data security by establishing standards. Implementing consensus methods and developing internationally accepted standards are two things to think about.
An oversight policy can “help resolve difficulties with legal and regulatory ambiguity and regulatory arbitrage,” according to the GAO. In addition, the GAO suggests that instructional materials be issued to address issues such as a lack of comprehension and ambiguous benefits and costs.
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The fourth policy option, suitable uses, addresses difficulties such as financial system vulnerabilities and ambiguous benefits and costs. The evaluation notes that the Commodity Futures Trading Commission (CFTC) lacks the authority to engage with non-governmental organizations:
“Legal or regulatory ambiguity may prevent some potential blockchain users from reaping the benefits of the technology.”
The Virginia Senate overwhelmingly adopted a bill amendment request on March 5 that authorizes traditional banks in the region to offer virtual currency custody services.
Delegate Christopher T. Head introduced the measure in January 2022, stating:
A bank may offer virtual currency custody services to its customers if it has in place 26 appropriate mechanisms to effectively manage risks and comply with applicable legislation.
The measure cleared the Senate with a resounding 39-0 majority and is now awaiting Governor Glenn Youngkin’s signature.