Bitcoin Surpasses Gold Trading in Brazil

By Gill Plimmer

Britain’s decision to trial the use of the technology behind bitcoin to pay welfare benefits to the unemployed and disabled has sparked privacy concerns.

The Department for Work and Pensions began a trial in June of the system, which uses blockchain technology to pay benefits directly to welfare claimants.

GovCoin Systems, the UK technology company behind the blockchain system, said initial trials had proved successful but that final results being collated by University of College of London were not expected until October.

“Claimants are using an app on their phones through which they are receiving and spending their benefit payments,” David Freud, the welfare reform minister, told a payments conference last week. “With their consent, their transactions are being recorded on a distributed ledger to support their financial management.”

If successful, the technology could be used for everything from tax collection to the sharing of health records, according to a government report released this year. Advocates of blockchain technology argue it is more secure and transparent, cutting down the risk of fraud and error. But welfare campaigners are concerned it would allow the DWP to check that payments are spent only on certain things.

Critics including the Open Data Institute, which was established by David Cameron in 2012 to promote transparency in government, described the move as “very concerning”.

“Experimenting with putting highly personal data in immutable data stores is fraught with danger,” said Jeni Tennison, the ODI’s technical director and deputy director. “To avoid undermining trust in government’s use of data, DWP should be much more open and transparent about the policy objective of these trials, the safeguards they are putting in place to limit the risks and the lessons being learnt through the trial.”

GovCoin said it was aware of the ODI’s concerns and had taken the data protection and privacy issues seriously.

The DWP said it would “continue to monitor new innovations in the marketplace which would represent value for money, safeguard information and protect and improve payments to customers.

Via:http://www.valuewalk.com/2016/07/bitcoin-vs-gold-brazil/

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