||Central Bank Of Barbados
While he is not advocating for governments to invest in bitcoin, Dr. Simon Johnson believes that there are practical applications for the technology surrounding it, specifically blockchain technology.
Speaking to a group of public sector officials at the end of his first week in Barbados, Johnson suggested that a secure but decentralized system could help to increase efficiency. He cited two potential applications for the technology: to facilitate payments and renewals for land tax and road tax in a way that would eliminate the need for Barbadians to stand in long lines; and to track spending and monitor budgets across multiple departments and ministries in real time. The latter, he said, would also make the audit process much simpler.
He also spoke about a pilot project in Mexico to make social welfare payments using the blockchain. Recipients could then exchange the payments for cash, transfer them to other people, or use them to purchase goods and services directly.
During the question and answer period, one participant acknowledged that blockchain technology could improve efficiency and also drive down transaction costs, but asked about the costs associated with adopting the technology. Johnson pointed out that systems are routinely upgraded, so the incorporation of blockchain technology could occur organically and incrementally.
He made it clear that government’s role in the adoption of blockchain technology should be to establish the national priorities and to regulate the system, then allow the private sector to innovate and set-up the infrastructure.
At the end of the session, Johnson outlined three things the government should do as it relates to the evolution of blockchain technology:
- It should pay attention to what the international companies and firms were doing to get a clear picture of what the trends are
- It should monitor the different pilot projects that are taking place around the world to see what is applicable for Barbados
- It should depend on its technical people to explore economically viable options for utilizing this technology
Opening Remarks - Patrick McCaskie.pdf