Payments for city services via cryptocurrency could become a reality in the near future, as could storage and processing of paperwork using blockchain ledger technology. Those are two of the possible outcomes from a pair of resolutions set for consideration at next week’s City Council meeting, following a South by Southwest festival heavily focused on increasingly prevalent technologies.
A resolution from Council Member Mackenzie Kelly would direct the city manager to examine ways the city could adopt the use of Bitcoin and other cryptocurrencies for financial transactions, as well as the benefits and risks of using strictly digital currency.
Mayor Steve Adler’s resolution is focused on the more foundational blockchain tech that helps those currencies to exist by producing digital records of transactions between users and organizations. In touting blockchain as potentially revolutionary advancement, the resolution would direct the city manager to pursue events and initiatives that promote the technology and businesses in the city involved in its advancement.
The resolution identifies 20 components of municipal services that could be improved using blockchain platforms, such as processing of applications and transactions, handling of asset titles, identity verification and payment processing.
Adler participated in a press conference last week with local tech leaders promoting blockchain. Via email, Adler said he sees great potential in using it to improve delivery of city services.
“Possibilities for blockchain applications are endless. I’ve heard of several innovators combining NFTs with ownership interest in art pieces to be later sold, allowing artists and investors to meet one another without the middlemen and giving each greater control over their assets,” he said.
Adler said blockchain was a topic of much discussion among the 25 mayors who attended SXSW, noting that his list of 20 municipal service uses could have grown to 100, since “everyone is looking for innovative solutions to tackle municipal challenges.”
“I’ve not seen, yet, a city use of a blockchain application that meets the potential of the technology, though several seem to be pursuing use cases,” he wrote.
Kelly said her interests in civic uses for cryptocurrency grew last year when she learned about the concentration of crypto-related businesses in Austin, and heard of Gov. Greg Abbott’s goal to make Texas a world leader in crypto and blockchain technologies. Kelly planned to attend a Bitcoin-related event today made possible by the concentration of tech talent in Austin for SXSW.
Her resolution, which asks for a progress report in June, would shed more light on the positives of accepting cryptocurrency, though she noted the volatility of Bitcoin and other coins is a concern.
“One of the potential uses of cryptocurrency being adopted by the city would be the opportunity to pay for city services and property taxes. This could offer flexibility to people who might not have a bank account or traditional forms of payment that the city historically has taken,” she said via email.
“The market changes related to cryptocurrency will certainly be a determining factor in this study to determine if it could be an accepted form of payment or not.”
The city’s Innovation Office received a pair of grantsin 2018 that led to the creation of a blockchain platform eventually known as Life Files Austin that is still being finalized and was created to help homeless people convert their vital documents to secure digital files. The objective was to prevent someone’s life from being disrupted in the event of the loss of a birth certificate, Social Security card or other important paperwork.
Kerry O’Connor, former head of the Innovation Office, said staff identified notary certification as another use of the technology, with work being done to perform notarization services in compliance with Texas laws.
O’Connor said hiring and retaining blockchain developers to create applications and platforms would likely be a challenge for the city since those positions command salaries of more than $150,000, but she added that the variety of uses was obvious.
“There is lots of potential for these technologies, and my focus when I was innovation officer was to ask how we can use these technologies to lift up the marginalized and lift up those who are experiencing poverty and make it a rising tide that lifts all boats,” she said. “With attention to ethics and user experience design they can help everyone.”
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