In Washington, there's a discussion about implementing blockchain technologies in USAID's operations to track and enhance transparency of financial flows.
Structural Reform and Cryptocurrency
The United States Agency for International Development (USAID) may soon change its name and direction towards blockchain usage. This transformation suggests oversight by the State Department and the use of blockchain to 'secure and trace distributions' of aid. Such changes could replace traditional methods of transaction verification, eliminating gray areas and opaque intermediaries.
Transparency or Technological Mirage?
Behind the promises of increased transparency lie more complex issues. Proponents argue that the immutability of blockchain records would deter misuse; however, critics point out the paradox: how to reconcile the anonymity of beneficiaries with complete transparency? Meanwhile, the volatility of cryptocurrency raises questions about its suitability for a sector where every penny counts.
Technological Challenges
The introduction of cryptocurrency may exacerbate issues in regions lacking digital infrastructure. Training local professionals and ensuring internet access become essential prerequisites. Without these measures, blockchain risks exacerbating the inequality it aims to solve.
If USAID decides to implement blockchain, it could lead to significant changes across the humanitarian aid system. However, its success will depend on its ability to adapt to technical and organizational challenges.
