Washington Examiner: Military needs to catch up to China on blockchain technology, says Soto

May 22, 2020
In The News

It dawned on Rep. Darren Soto when Facebook founder Mark Zuckerberg was testifying before Congress during his first term as a young congressman from central Florida.

 

“A lot of members of the Congress don’t have as strong a grasp of technology as one would hope,” said the second-term Democrat and co-chairman of the Congressional Blockchain Caucus.

“A lot of this stuff can make people’s heads spin,” Soto told the Washington Examiner of the secure, static ledger technology known as blockchain, which works like a shared Google spreadsheet but is much more difficult to hack because it is “distributed,” or saved in parts over many different servers.

“We’re the federal government. We have to be able to take on complex issues simply most other organizations can’t take on,” Soto said after the release of an industry-written report Wednesday on the potential uses of blockchain technology in the Department of Defense.

The central Florida Latino of Puerto Rican descent sits on the House Energy and Commerce Committee, where he was first successful in mandating a Department of Defense briefing to Congress on the use of blockchain technology.

He said a briefing to the Senate Armed Services Committee was supposed to take place by May 15 but that the coronavirus delayed it.

“The risk is that we fall behind,” Soto said on the national security implications of allowing China to lead on the technology.

China adopted the technology, first developed by Bitcoin, in its military in 2017.

“Even with the best defenses, those defenses eventually become antiquated, so we have to use different ways to be able to protect strategic information,” added Soto.

Value Technology Foundation founder Jason Brett, whose organization authored the report, warned against the extended timeline for a technology already used by Fortune 500 companies, including co-authors of the report such as IBM, Accenture, Amazon, and Deloitte.

“Having all of your data in one central database where everyone in the world knows to go … is not a very strong defense,” Brett told the Washington Examiner, calling the development of blockchain technology a potential “Sputnik moment.”

Brett added that Chinese President Xi Jinping said two years ago that blockchain technology represented an advance 10 times as important as the internet.

“China really, at the end of the day, is a country that is always looking for some sort of advantage and has been very aggressive on the technology,” he said. “We don’t see that same sort of policy leadership here in the U.S. right now.”

The former Federal Deposit Insurance Corp. regulator gave an example of how blockchain could have been used to prevent a public relations and health disaster in the Navy, using a hypothetical scenario in which the commander of the coronavirus-plagued USS Theodore Roosevelt had blockchain at his disposal.

“If there was a spreadsheet, a database that actually showed the facts, it would give the captain a better case to make, where he might have convinced the people without having to send out an unclassified email,” he said, referencing Capt. Brett Crozier’s email that was leaked to the press and that led to his ouster.

Brett said he understands the uphill battle for congressmen such as Soto, who must explain blockchain technology to members of the appropriations committee.

“They’re trying to get their heads around what blockchain is and why we need to make this investment,” he said. “The roadblock is that we need Congress to approve a federally funded research development center, and that’s what our next step is.”

Soto said he hopes to get closer to streamlining blockchain research by calling for a report to Congress in the upcoming National Defense Authorization Act and, by 2022, funding for a center of excellence to centralize how blockchain technology is used in the military.

“Even as the technology gets more complex, we need to make sure to maintain our competitive edge,” Soto said. “It’s gonna be more than just airplanes and tanks; it’s going to be computers, artificial intelligence, and blockchain technology that decides the future of our national security and our military competitiveness across the globe.”