April 5, 2020 Blockchain technology could increase the effectiveness of government relief packages.

According to Stephanie Hurder, an economist at Prysm Group, blockchain, and distributed ledger technology could increase the effectiveness of government response packages, like those being currently administered in the U.S. in the wake of the COVID-19 crisis. Hurder argues that in environments such as the present, government aid can be far more effective if there are guaranteed commitments since it allows citizens to have faith in the government’s actions and therefore begin to spend more freely, encouraging economic growth. While she argues, that the current infrastructure provides no way of offering such a guarantee, blockchain technology through the use of smart contracts and enforcement by distributed consensus could provide a far surer method of guaranteeing any such commitments. In the hypothetical scenario of the government issuing payments via a national stablecoin, the conditions for such payments could be managed by oracles relaying economic data to smart contracts on a distributed ledger, and triggering the issuance of payments to citizens. Although Hurder stresses that neither the technology nor political will is yet sufficient for systems such as these at the national level, she does argue that DLT solutions could ultimately reduce economic damage and societal disruption during such crises.