Can Blockchain Bring Democracy Back To Full Circle?

If there is one thing that the ancient Greeks gave us that anyone who isn’t a math, physics or philosophy major can understand is the concept of “δημοκρατία” (demokratia) which combines “δῆμος” (people) and “κράτος” (force, or power) literally translating to “People Power.” Today we know it as Democracy. In as much as there are many forms of democracy, we will not be delving into a politicized discussion of the merits of one form over another. Rather, we will be looking at the mechanism(s) by which people exercise their power, what technology has brought to that process and what more it can do.

One of the basic tenets of the Democratic process is “One person, one vote.” Over the millennia we have seen this process evolve from counting raised hands in a room to counting anonymously marked paper ballots to anonymously marked paper punch cards to voter selections recorded digitally. While the method of casting votes has changed, the way these votes are collected and tabulated hasn’t changed all that much over the years. Portions of this process have become digitized but much of what happens is still very much an analog affair. It has been some time since we collected handwritten pages but we still transport and protect boxes of ballots, handfuls of thumb drives and increasingly, digital uploads. Moreover, there are estimated to be 230,000 polling stations nationwide that in a federal election need to coordinate the collection and aggregation of all those votes.

Beyond the operational friction of collecting and tabulating all those votes, there have always been and will continue to be reasons as to why not all of the now roughly 240 million voters make it to the polls. Indeed, given the latest presidential election results, "only" 155.5 million eligible voters cast votes this past November. Of the 85 million citizens that did not cast their vote, some did so out of voter apathy, but there were also some who could not physically make it to a polling station, or were unable to complete a mail-in ballot fully and correctly.

Given these issues of operational complexity and access, what solutions are out there?

In a word? Blockchain.

Seems like some future utopian ideal? For some, it has been a reality for some time now.

For example, the country of Estonia has retooled much of its infrastructure around blockchain technology and currently offers e-identity to citizens. While we here rely on a printed paper social security card, Estonian citizens are issued a 384-bit encrypted, chipped identification cards that not only acts as proof of identity but also is used for accessing their national health care plan, their travel documents, proof of identification for financial transactions, to digitally sign documents, and yes, to cast votes. In fact Estonia states that 99% of all government services are available online. While cards are issued, the same identification functionality can be had on a smartphone with the use of what is described as a “special” SIM card in a mobile-id format.

Now you might be thinking, how many people are on this network? What about scale issues?

Estonia has about 1.3 million citizens and at last count, there are approximately 240 million eligible voters in the United States.

The beauty about all things digital is that they scale so very easily. The revenue growth paths for Amazon (AMZN) Web Services, Microsoft (MSFT) Azure and IBM (IBM) Cloud Computing segments all provide evidence of rapid scalability. We mocked up voting tabulation results using a simple CSV file and estimate that all that theoretical voting data would amount to between 5.5 - 6.0 GB of data. By comparison, the current size of the Bitcoin blockchain is estimated to be 320GB. While there have been cases of bad actors stealing wallets, there has never been an instance where the integrity of the blockchain itself was called into question.

When we think about other public companies directly involved in blockchain development, what we see are not necessarily companies that are developing this tech but rather, companies that are implementing or interacting with it. Companies like Square (SQ) and PayPal (PYPL) are integrating Bitcoin access into their platforms while Overstock.com's (OSTK) tZERO has established a regulatory compliant trading venue for digital securities through its alternative trading system, tZERO ATS. Of course, companies like Intel (INTC) and Nvidia (NVDA) are other infrastructure plays in this space. For direct exposure to blockchain technology as an investor you would really be looking to invest in a publicly traded miner, which do exist, but currently are only traded in the OTC markets in the U.S.

In terms of voter verification, all that data is already housed and online at ssa.gov. Let’s not forget that the U.S. Postal Service filed a patent in February of 2020 (made public in August of last year) outlining a blockchain based national voting system that would rely on a combination of physical mail, QR codes and blockchain to make voting easier, more secure and instantaneous. We may not be ready to put our entire lives on a blockchain but bringing voting into the 21st century would be a good start.

Imagine if we did get a blockchain based voting infrastructure in place. What then?

Well, for starters we could truly get back to “One Person, One Vote.” Another positive is that by making it easier to vote, more people would vote and the more people vote, the more they become engaged. Imagine having a national referendum on truly important matters and not having legislation caught up in so much red tape? That, or at least being able to let your representative know directly your up/down opinion on current pending legislation without wondering if your letter or email was actually read or if your campaign contribution will actually get you some face time?

An old Chicago political joke reminds voters to “Vote early, and often.” A blockchain based solution can guarantee that the first part of that admonition gets fulfilled and the second part never could be.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Other Topics

Blockchain Technology Elections Politics