Distributed ledger technology will likely find a home in the city’s back-office, review and consultation processes, before any citizen-facing platform, says Tina Scott, one of Toronto’s IT business application services managers.
“That’s where we see a real opportunity for blockchain,” Scott tells ITBusiness.ca.
Toronto has been following the development of blockchain and participating in proof-of-concepts (POC’s) since 2017, beginning with a POC with the Province of Ontario involving restaurant licenses. The POC lasted approximately three months and showed significant promise, says Scott.
Since then, interest in blockchain – a distributed ledger comprised of blocks of information which are linked using cryptography – has spread across multiple city divisions, culminating in a three-day training session this summer, where 20 IT professionals were trained, and then subsequently participated in a hackathon where City business and technical teams came together to build their own decentralized application using the Ethereum platform. This hands-on learning experience was achieved with the help from the Blockchain Learning Group, an international team of developers that deliver training sessions which emphasize the benefits of blockchain, and its application to a wide range of transaction types, a concept that’s being realized globally. A report from Deloitte says governments are exploring blockchain usage in land registration on every continent but Antarctica. The conversation around blockchain at the federal level in Canada can be traced back to at least December 2016, when senior government officials and then-international trade minister Chrystia Freeland, met to discuss the technology with executives from big banks, regulators, the tech sector and other companies, according to reporting by The Star.
Now, the City is focused on identifying opportunities with their capital projects slated for 2019 and 2020 that would benefit from blockchain. Scott says city services that work in tandem with provincial ministries and other agencies are best suited for blockchain adoption, a point which was reinforced during a meeting with the province Nov. 22.
“Right now, we’re looking at the technology as a possible contributor for some of the capital projects that would get started in 2019 and 2020,” she says. “We’re not committing to using blockchain, but based on the business cases that have been submitted and the benefits and business objectives our City services want to achieve, blockchain has been flagged as the technology to be considered.”
Toronto’s priorities are related to transportation, civic modernization, housing and fiscal sustainability, and Scott says any opportunities to deliver these services more efficiently – through the use of blockchain, for example – will be considered.
But exploring the capabilities of emerging technologies in the public sector can be difficult, says Cielo Medel, acting director, business solution services for the City of Toronto. Funding associated with emerging technologies is almost always directly aligned with a city service that is in need of modernization, so opportunities for research and development are rare, and instead, are aligned with business-driven capital projects.
“It’s all targeted funding prioritized from the top,” she explains, referring to the city’s executive team. “But we’re confident blockchain will be part of a lot of divisions’ tool kit.”
Ethereum platform almost everyone’s go-to
It’s no surprise Toronto staff are training on the Ethereum platform. Between 2008 and 2016, global startup growth around blockchain grew by 18 per cent, and as of January 2018, there were more than 40,000 applications built on the Ethereum blockchain alone, according to a Startup Genome report.
In a previous interview with ITBusiness.ca, Michael H. Conn, CEO for Toronto-based technology company Ether Capital, says more than 94 per cent of decentralized applications are being developed on Ethereum.
“We’re starting to find businesses that are having true impact on blockchain,” says Conn. “And it’s not just startups. The JP Morgans, BMOs and others are trying to figure out how to use blockchain. You’re seeing this development where private blockchains are being married with public Ethereum blockchains, and that legitimizes it more.”