Illinois government steadily builds blockchain strategy

The Illinois state government has quietly established a working group to develop a strategy for integrating blockchain technology.

The taskforce was formally established earlier this year and includes representatives from several public agencies, including the state's departments of Innovation and Skills, Finance and Professional Regulation and Insurance.

The task force is reportedly tasked with determining how blockchain can make government services more efficient while making it easier for citizens to interact with state agencies.

Anne Melissa Dowling, head of the state's insurance department, told reporters her office is on an aggressive self-education campaign and hopes to become the first government insurance agency in the U.S. to use blockchain technology.

Dowling told CoinDesk:

“Right now, we’re trying to determine if we can be a first mover in this space by developing a distributed version of a government ledger, but we’re doing a lot of learning.”

In the interview, she cited using distributed ledgers to reduce friction between insurers, regulators and policyholders in Illinois as a potential application area.

However, similar to other state agencies, Illinois will not adopt blockchain technology overnight.

Dowling and her colleagues are reportedly involved in the work of the Illinois Blockchain Working Group. The need to build network effects is high on Dowling's list of concerns. According to her prediction, lobbying many different entities to build a viable solution is one of the biggest obstacles. In addition, she also said that there is no legal precedent for such an initiative, nor is there a means to design or build a blockchain system.

“Conceptually, it’s absolutely beautiful,” Dowling explains, “but we need more experience, and we need to spend more time crunching the data.”

Despite the difficulties, this does not mean that the transition will be complicated.

William Mougayar, author of the book "Business Blockchain," said in an interview with reporters that "semi-private" blockchains initiated by the state will have a solid foundation and will be welcomed by market stakeholders. He said the real challenge is to get regulators on board, in this case, the National Association of Insurance Commissioners.

“I suspect the regulatory issues are more critical,” he said.

Focus on consumers

Now, Dowling and the rest of the group are still weighing their options. She said she’s still learning, even as she’s expanded her technical knowledge.

As part of that process, Dowling plans to attend a blockchain regulatory panel in Chicago on Nov. 8, where she said her main goal is to get as much hands-on education as possible.

She concluded:

"These efforts are really about consumers, and ensuring we can serve them in the most efficient and cost-effective way possible. Illinois wants to see any way it can help the government achieve that goal."