The use of blockchain on the Small Business Administration’s ledgers might help streamline the reporting process for its grant programs, but the technology could also be too complex for the agency’s operations, the Government Accountability Office said in a new report.
The study was conducted amid the increasing popularity of blockchain as a potential non-financial tool to improve federal agencies’ operational efficiency, GAO said Tuesday.
Blockchain is a nontraditional type of shared database that enables easy detection of changes in a published transaction. Selected government agencies have adopted the technology to boost efficiency and reduce costs, but most of their efforts ended at the pilot phase.
The study explored blockchain’s potential benefit to SBA’s submission of Congressional reports on the Small Business Innovation Research and Small Business Technology Transfer programs.
GAO used guide questions formulated by the Department of Homeland Security’s Science and Technology Directorate, to assess its advantages and limitations.
Based on interviews with blockchain experts, the government watchdog found that SBIR and STTR reporting could be submitted on time if a blockchain-based ledger is implemented with adequate coordination and consistency. The ledger could also serve as an alternative resource for Congress before SBA’s submission of annual reports.
On the other hand, blockchain-based ledgers could be unnecessarily complicated to adopt and will not necessarily prevent fraud, the experts noted.
