The British government hopes to utilise blockchain, the distributed ledger technology behind cryptocurrency Bitcoin, as a tool to monitor and control state grants.
Cabinet Office Minister Matt Hancock said at a speech this week that blockchain technology provides the the kind of distributed consensus of trust needed by government departments to provide efficient digital services and capabilities replacing legacy paper-based methods.
According to Hancock, blockchains provide integrity and immutability, as only new data can be written to them, with nothing being removed or deleted.
While Hancock doesn't believe blockchains are the right tool for every situation, the UK government has already begun investigating their use in several areas, including a A$19.1 million research initiative by the Alan Turing Institute, and a review of the technology published in January this year.
One of the potential applications could be the management of government grants, Hancock said.
"Monitoring and controlling the use of grants is incredibly complex. A blockchain, accessible to all the parties involved, might be a better way of solving that problem," he said.
Hancock suggested blockchain could also be used to track student loans funds from the UK Treasury to the individual bank accounts they are being deposited into.
Another use for blockchains would be to monitor international aid money, to see how it is being spent in the country it has been allocated to, Hancock said.