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DHS Needs Block and Chain to Counter Fake Documents

A pilot program separates blockchain hope from hype.

Officials with the Department of Homeland Security Science and Technology Directorate are exploring the potential for blockchain technology to prevent fraudulent government documents as agencies consider transitioning from paper-based processes to digital. And they’re not interested in cheap imitations.

The directorate, commonly referred to as S&T, issued a solicitation late last year for solutions that use blockchain and distributive ledger technology to issue digital documentation in a way that prevents fraud, counterfeiting and forgery. The solicitation falls under the S&T’s Silicon Valley Innovation Program and is open to startups and small businesses that have not had a government contract in the past 12 months totaling $1 million or more and that have under 200 employees at the time of application.

The solicitation was released in partnership with Customs and Border Protection, U.S. Citizenship and Immigration Services (USCIS), and the Transportation Security Administration (TSA). It happens to be the first Silicon Valley Innovation Program solicitation supporting citizenship and immigration challenges. Directorate officials want solutions applicable to a range of digital documents, including individual identity documents for travel; identity of organizations and organizational delegates; tribal identity documents for travel; citizenship, immigration and employment authorization; cross-border oil import tracking and origin of raw material imports.

Anil John, the S&T Directorate’s technical director for the Silicon Valley Innovation Program, has been exploring blockchain’s potential for a few years and has become the directorate’s point man on the technology.

“This is a funding opportunity for startup companies through the Silicon Valley Innovation Program, and it is a result of about three years of investment and exploration of the security and privacy implications of blockchain technologies at DHS [Department of Homeland Security]. I was fortunate enough to be the program manager at that time who was driving that, so whether fortunately or unfortunately, I’ve ended up with the DHS research and development portfolio around blockchain,” he says.

That initial exploration led to some lessons learned that can be applied to the current effort. One lesson, for example, is that not all solutions industry has to offer live up to the hype. “The challenge right now is that a blockchain is not a blockchain is not a blockchain. We’ve seen a whole lot of companies that have neither blocks nor chains in their solutions but only in their marketing literature,” John says.

Various DHS organizations issue documents for a range of reasons, and those issuance processes are often paper-based, noninteroperable and susceptible to loss, destruction, forgery and counterfeiting. For example, many travelers are familiar with the process of transportation security officers confirming identities at security checkpoints by reviewing drivers’ licenses and passports, assessing them for possible fraud or tampering, manually matching the biographic information on the credentials and the boarding passes, and visually comparing the photos on the credentials to the faces of the travelers. That manual process needs to be performed in seconds to prevent bottlenecks, and it relies on the judgment of security officers.

In addition, citizenship and immigration officials may be able to use blockchain technology for green cards and citizenship certificates. There are more than 250 federally recognized tribal entities within the United States, and they have the ability to issue identity documents for travel. “Especially since tribes sometimes sit across, for example, our northern border, it is a joint equity for both the USCIS from the issuance perspective and for the TSA validating that identity at a travel check point,” John notes.

Verifying the identity of organizations also is important for international trade. “Everybody talks about the identity of people, but from a trade perspective, we want to have confidence that the organization at the other end of the line that is moving goods into the United States is a legitimate organization,” John notes. “We want to understand who is delegated to act on behalf of that organization and also to make sure that the carbon-based life form who has shown up is actually the person who is dedicated to act on their behalf.”

Other possibilities involve tracking raw materials, such as timber, diamonds, precious metals and oil. For example, oil produced in Canada and oil traveling through Canada from other countries can be taxed differently. “The different duties that are assessed on those different types of oil is a manual, paper-based process right now, and we want to automate and speed that up,” John says.

Among the lessons learned so far is that the marketing of blockchain solutions includes “lots of hype, lots of irrational exuberance,” John indicates. For 80 percent or 90 percent of the issues for which users thought they might need blockchain, other technologies have proven more useful. “You can basically do the same thing with currently mature technologies.”

Blockchain seems especially useful, he adds, in cases involving multiple independent parties that do not want an infrastructure owned and controlled by just one party. “That’s why a lot of the use cases that we have are multiparty—independent entities, public and private sectors. You will rarely see a use case that is entirely internal to government because from our perspective, there are very mature technologies that can do a better job,” John explains.

S&T Directorate officials also stress the need for interoperability. If, for instance, different trade consortia operate different blockchain systems, the U.S. government needs one system capable of operating with all. “One of the things we are very, very clear on is that the solutions that the startups propose to us need to have those specifications and standards to ensure interoperability between solutions. Or they should be taking our funding to bake that into their product line because we do not want to be locked into one particular vendor,” John states.

Interoperability is important in part because department officials do not want to inadvertently point the highly competitive blockchain marketplace in any one direction.

“We are sort of at a flexion point with blockchain technology whereby there is a lot of desire for companies in that space to become the next platform, where everybody comes on their platform and the platform provider sits in the middle and extracts value from it,” John suggests. “The government is not interested in picking a winner in the blockchain horse race. We’re not fans of a one-ring-to-bind-them-all approach that may be the operating model of a lot of the bigger blockchain companies.”

To the contrary, government officials want to ensure small businesses are able to compete, he continues. “We do not want to take a position where we are mandating that everybody else choose a particular vendor. We want an ecosystem of interoperable blockchain technologies. We want to make sure there is opportunity not only for the big players but also for the startups and the small players on an interoperable playing field.”

The S&T team also emphasizes the need for security of personally identifiable or proprietary information, and in this case encryption is not enough. “Encryption algorithms by their very nature—because of Moore’s Law or because of implementation challenges—eventually become public. That is a reality in the world,” John declares. “Encrypting data, putting it on a public chain, sooner or later, 10 years or 15 years down the road, will eventually result in that data becoming public. We are interested in architectures whereby no private data, no sensitive data, is ever put on a public blockchain.”

While blockchain appears interesting for some of the Homeland Security Department’s challenges, S&T’s team is assessing the business case as much as the technology itself. “This is our opportunity to basically do a pilot and proof of concept, kick the tires of the technologies to find out if they’re scalable, if they can support government use cases,” John says. “It is not just a technical evaluation. It’s also a business evaluation, a legal evaluation and an evaluation of whether or not the internal investment is actually worth it.”

That is the approach S&T takes to every project, he adds. “That is part and parcel of every single effort that we are going to be doing. It is not simply a technical decision in any way, shape or form.”