The US Congress is advancing a key piece of legislation aimed at developing a regulatory framework for blockchain technology and examining how the government can benefit from its applications.
The US Senate Committee on Commerce, Science, and Transportation approved the Blockchain Promotion Act on Tuesday, a joint effort by bipartisan parliamentarians to guide the US Department of Commerce's standard definition of "blockchain."
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"Blockchain" is a billing technique that is the underlying technology for Bitcoin and other cryptocurrencies. The blockchain distributes the books on multiple computers, so everyone on the network can handle all transaction records, a tamper-proof and easy-to-audit way to record.
Ed Markey, a Democrat from Massachusetts, is also one of the initiators of the bill. He said in a statement:
“The blockchain is an exciting new technology with great potential and prospects.”
Markey pointed out that the technology has been used in the private sector to expand the use of renewable energy, strengthen medical service delivery systems and improve supply chain efficiency.
“This legislation will help to further understand the application of this technology and explore opportunities to use this technology within the federal government.”
The bill, which was resubmitted in February this year, was supported by the bipartisan members of the House and Senate. The aim is to prevent fragmentation of the blockchain definition at the state level and to set the framework for future technical regulation. Several bills on blockchain technology have been introduced.
Legislators have also seen opportunities to use this technology to improve the efficiency of government functions. The working group described in this bill will help the government to do this. Many experts believe that blockchain is a major innovation in dual-ledger accounting, which may play an important role in providing government services, preventing tax fraud, eliminating bureaucracy, and reducing waste. For example, it can be used to track health care and social security benefits systems, or to improve document management and storage models. Another potential application of the blockchain is to help organizations—for example, the Federal Communications Commission better allocate and manage wireless spectrum licenses.
California Democratic Party member Doris Matsui pointed out:
"This bipartisan, bicameral bill will bring together a large number of stakeholders to develop a unified definition of the blockchain and, perhaps more importantly, it will provide opportunities to use this technology to promote innovation."
Specifically, the working group will provide advice to other government agencies, including the National Telecommunications and Information Management and Federal Communications Commission, to study how to use the technology to help manage the wireless spectrum and help other agencies within the federal government improve efficiency.