| Line 129: |
Line 129: |
| | | | |
| | <h2>Implications for Government Agencies</h2> | | <h2>Implications for Government Agencies</h2> |
| | + | |
| | <h3>Shared Services Canada (SSC)</h3> | | <h3>Shared Services Canada (SSC)</h3> |
| | | | |
| | <h4>Value Proposition</h4> | | <h4>Value Proposition</h4> |
| − | <p class="expand mw-collapsible-content">Collaborative technologies like blockchain promise the ability to improve the business processes that occur between organizations and entities, radically lowering the “cost of trust.” As a result, blockchain may offer significantly higher returns for each investment dollar spent than that of traditional internal investments, but in doing so means collaborating with customers, citizens, suppliers and competitors in new ways.<ref>Treasury Board of Canada, Blockchain: Ideal Use Cases for the Government of Canada, 5.</ref></p>
| |
| − |
| |
| − | <p>Blockchain offers a numbers of benefits to the Government of Canada, such as a reduction in costs and complexity, trusted record keeping and user-centric privacy control. It offers significant opportunities in terms of a single source for public records, support for multiple contributors and a technology ideal for multi-jurisdictional interactions. Due to its decentralized, collaborative nature, it potentially aligns well with policies and practices around Open Government, which aim to make Government services, data, and digital records more accessible to Canadians.</p>
| |
| | | | |
| − | <p>By eliminating the duplication and reducing the need for intermediaries, blockchain technology could be used by SSC to speed-up aspects of service delivery. A challenge for SSC in terms of blockchain will be to identify which enterprise solutions emerge as leaders and how they deal with privacy, confidentiality, auditability, performance and scalability.</p> | + | <p>The value proposition of DLP relates directly to SSC’s mandate to design and operate a secure IT infrastructure that protects GC data and technology assets. The primary business value in implementing a DLP strategy is the reduction of risks and impacts associated with data leaks. These incidents often affect an organization in the following aspects:</p> |
| | | | |
| − | <p class="expand mw-collapsible-content">Currently, a number of Government agencies are engaged in Blockchain in a number of ways. Maybe SSC could support the following departments in their initiatives to explore how Blockchain can help solve these issues: | + | <ul> |
| − | <ul>
| + | <li><b>Operational:</b> A data breach often causes an interruption of services until the investigation process is concluded – this can take weeks or months, costing an organization business or other resources in the meantime. DLP ensures redundancies are put in place to counteract important data losses, thereby avoiding cost to operational resources to remediate lost data.<p class="expand mw-collapsible-content"> In 2015, SSC implemented the Directive on the Use of USB and Other External Storage Devices to help manage these sorts of risks. All of SSC’s electronic assets have a DLP software-based tool that monitors the use of unauthorized devices on the network. This prevents removal of data from the SCC system or prevent infecting the system with any malware, viruses or other malicious entities. A second phase of SSC’s DLP program is in the planning stages and will monitor enterprise data in motion and at rest – this is already in place in terms of secret data, however.</ p></li> |
| − | <li><b>Elections Canada</b> – practical applications to support Voter List Management, Secure Identity Management, and management of electoral geography.</li>
| + | <li><b>Financial:</b> There are significant financial losses resulting from data breaches, including fines, audit fees and legal expenses. The Ponemon Institute has estimated that the average global cost of a data breach has risen to $3.9 million and $5 million in Canada specifically in a 2018 study. Contrast this to the average annual cost of a subscription based DLP solution of approximately $175,000, according to Forrester.</li> |
| − | <li><b>Financial Transactions and Reports Analysis Centre of Canada</b> – exploring implications for anti-money laundering and counter-terrorism financing.</li>
| + | <li><b>Reputational:</b> Data losses affect the reputation and damages the brand. Often, organizations will see a drop in their valuation, which results in potential loss of future revenue, their competitive advantage, and their market shares. Consequently, the consumer trust in the organization also experiences a decrease which can have large-scale ramifications in short and long-term revenues. Having a DLP solution helps disassociate the user’s concern for safety and builds clients’ trust.</li> |
| − | <li><b>Public Safety Canada</b> – focused on various uses and misuses of virtual currencies, such as extortion or blackmail.</li>
| + | </ul> |
| − | <li><b>Natural Resources Canada</b> – use as a public registry for the disclosure of payments under the Extractive Sectors Transparency Measures Act.</li>
| |
| − | <li><b>Bank of Canada</b> – exploring a proof of concept model alongside Payments Canada, Canadian commercial banks and the R3 consortium.</li>
| |
| − | <li><b>ISED</b> – engagement with Government departments, provincial-territorial-municipal partners, and key industry players.</li>
| |
| − | </ul>
| |
| − | </p>
| |
| | | | |
| | <h4>Challenges</h4> | | <h4>Challenges</h4> |
| − | <p class="expand mw-collapsible-content">There are weaknesses in terms of technological complexity, intensive computational and storage demands and a requirement for common software across all nodes. There are significant challenges particularly important within a governmental process. Truly digital assets with a single copy can be destroyed and a government network housing such assets would represent a very public target for malicious actors.<ref>Vallée, J.-C. L. (April 2018). <i>[Vallée, J.-C. L. (April 2018). <i>[https://www.conferenceboard.ca/temp/7dc77c07-7e5a-4be6-ad6d-7d1070f9ac20/9591_Cautious%20Optimism_BR.pdf Adopting Blockchain to Improve Canadian Government Digital Services].</i> Retrieved on 23 May 2019 Adopting Blockchain to Improve Canadian Government Digital Services].</i> Retrieved on 23 May 2019</ref></p>
| |
| − |
| |
| − | <p class="expand mw-collapsible-content">It is important to remember that Blockchain, while a technological innovation in transactional business and chain of digital custody, is not a single solution to transactional challenges facing the GC.</p>
| |
| − |
| |
| − | <p class="inline">The amount of time and energy required to maintain the blockchain and create new blocks is not small and this is a frequent criticism of the technology. Conventional database entry, such as using SQL, takes only milliseconds, compared to blockchain, which takes several minutes. Due to the length of time required as well as the need for multiple computers to verify the blocks, blockchains consume an enormous amount of energy.</p><p class="expand inline mw-collapsible-content"> However, as technology advances, the blockchain consensus process takes closer to three minutes with Ethereum, which is currently among the most advanced blockchains available.xxiii Even older blockchains, such as Bitcoin, are still faster than traditional financial transactions, such as the stock exchange, which can take days to be verified and finalized. Despite this, services or transactions that require rapid speed, may not be suitable for blockchain.</p>
| |
| − | <p class="inline-spacer"></p>
| |
| − | <p class="inline">There are also some concerns with respect to privacy. Since blockchain is built on the premise of decentralization and transparency, the data within the chain is technically available for anyone on the network, provided they have the computational power and knowledge to gain access. Instead of being identified on the network by name, users have encryption keys, which is a list of seemingly random numbers and letters.</p><p class="expand inline mw-collapsible-content"> While more private than a name or other demographic information, users could still be identified by their keys over time. Also, any data contained within a block that may have personal information that an individual wishes to keep private, such as medical records for example, may not be well suited for a blockchain as it will be transparent and visible to other users.<ref>Diedrich, H. (2016). <i>Ethereum: Blockchains, Digital Assets, Smart Contracts, Decentralized Autonomous Organizations.</i> Scotts Valley: CreateSpace Independent Publishing Platform.</ref></p>
| |
| | | | |
| | <h4>Considerations</h4> | | <h4>Considerations</h4> |
| − | <p class="expand mw-collapsible-content">By using an agreed upon consensus algorithm, collaborative technology like Blockchain promises the ability to improve the business processes that occur between organizations and entities, radically lowering the “cost of trust.” The cost of trust is lowered because there is only one record of a transaction that needs to be kept and all stakeholders trust that record.</p>
| |
| − |
| |
| − | <p>In a traditional transaction, all stakeholders have to keep a record of the transaction and in the case of a discrepancy, it was more difficult / costly to determine the accuracy of a record. As a result, Blockchain may offer significantly higher returns for each investment dollar spent than that of traditional internal investments. However, to doing so, it means collaborating with customers, citizens, suppliers and competitors in new ways.<ref>Treasury Board of Canada, Blockchain: Ideal Use Cases for the Government of Canada, 5. </ref></p>
| |
| − |
| |
| − | <p class="inline">Further research is needed to understand the potential impacts that blockchain could have on SSC as a service provider as well on the usage amounts the GC would require. SSC should consider the identification of client areas where blockchain may be leveraged. It may be required that client departments self-identify spaces which could benefit from blockchain processes.</p><p class="expand inline mw-collapsible-content"> A challenge for SSC will be to identify which partner organizations and enterprise solutions require priority blockchain pilot projects as well as be able to identify departments that emerge as leaders and how they deal with privacy, confidentiality, auditability, performance and scalability.</p>
| |
| − |
| |
| − | <p>Lastly, SSC and the GC should consider the capacity issues in resources, network capabilities, and time required to create and maintain blockchain networks on its own. Blockchain is not a pedestrian technology, it will require dedicated teams that are appropriately resourced and financed in order for the technology to be deployed as any other service. SSC may wish to consider looking for private sector companies that specialize in providing Blockchain as a Service (BaaS), and determine the risk and cost benefits of outsourcing this process altogether.</p>
| |
| | | | |
| | <h2>Hype Cycle</h2> | | <h2>Hype Cycle</h2> |