For years, blockchain was dismissed as a niche tool for crypto traders. Now, governments around the world are leveraging it to reengineer trust in public institutions and in doing so, potentially recast the relationship between the individual and the state.
Imagine tapping your digital ID to access healthcare, vote, or verify property ownership, which are cryptographically verified transactions backed by immutable ledgers. That’s happening now in places like Estonia and Dubai. But as systems converge, we must also ask: who controls the gate?
Government Blockchain in Practice & What You Should Know
Governments aren’t putting all your raw data “on-chain.” Instead, they use blockchain (or blockchain-inspired cryptographic systems) to anchor trust. They do this by hashing records, logging changes, and ensuring tamper evidence where the full data often stays in more conventional databases, accessible to authorized parties. Let’s recall and grow upon some of the examples I shared in a previous blog:
- Estonia: National eID cards, health systems, and public services run on a model where every record and change is hash-anchored to KSI blockchain, making tampering detectable but still respecting data privacy.
- Dubai/UAE: The Dubai Land Department is using blockchain to register properties, leases, and even explore tokenized real estate. The UAE’s digital identity platform (UAE Pass) enables users to sign documents and access services in a verifiable, auditable way.
- Sweden & Georgia: Real estate registry pilots using blockchain for title clarity and dispute reduction.
- European Union (EBSI/DID frameworks): Working toward cross-border digital identity so citizens can carry verifiable credentials across member states.
- China (RealDID + “social credit” echoes): China’s blockchain identity project, RealDID, seeks to mesh cryptographic identity verification with real-name registration requirements. Parallel—though not identical—is China’s Social Credit System, which has, in some cities, penalized individuals for certain behavioral metrics such as denying access to train tickets or flights over debt or other infractions. Click this Link to more about China’s social credit system.
Meanwhile, the United Kingdom recently announced a new mandatory digital ID scheme, which is set to require all workers to hold the ID by law. Government proponents argue it will simplify identity checks and reduce fraud, while critics warn of privacy erosion and expanding state surveillance. Learn more Here
Autonomy is at a Crossroads, When Does Trust Become Control?
Here’s where things get thorny. The convergence of government control + blockchain-backed identity systems promises efficiency, fewer intermediaries, and stronger auditability. But it also opens dangerous doors for state overreach.
The upside is empowered identity & infrastructure:
- Self-sovereign verification: Instead of carrying multiple physical IDs or paper records, individuals may verify identity or credentials through cryptographic proofs.
- Reduced fraud & intermediaries: Smart contracts and blockchain anchoring can cut out redundant verifiers and reduce human error or corruption.
- Transparent audit trails: Changes become traceable, which is beneficial for accountability in voting, land records, health data, and virtually every process out there that would benefit from clarity, security, and immutability.
The downside is visibility, control & algorithmic judgment:
- Surveillance merger: When identity, credit, health, and civil records are unified and anchored by blockchain, governments can map actions more comprehensively. The risk is that every click, payment, loan, or “misstep” could influence one’s standing.
- Algorithmic blacklists: China’s “social credit” system has sometimes blocked individuals from flights or train travel due to default judgments or infractions. While the government denies a universal numeric score system now, localized blacklists remain.
- Access denial via identity systems: If a government identity system flags you as “low score” or “untrustworthy,” you might be blocked from services, employment checks, or even from entry into private spaces. The UK’s digital ID plan has already drawn criticism from civil liberties groups over these risks.
- Mistakes, appeals & redress: Immutable systems make correcting errors difficult. If a bad record is anchored, how do you challenge or erase it?
- Chilling effects: When government control is baked into the identity layer, people may self-censor, avoid dissent, or behave “predictably” to avoid penalties.
In summary, a blockchain-backed system could be used to protect individual rights, or to regulate behavior in unprecedented ways. For legal professionals, this shift presents a growing field of concern and responsibility because immutable nature of blockchain poses fundamental challenges to data privacy and the “right to be forgotten,” creating friction with laws like GDPR or state-based privacy statutes.
Questions revolved around governance such as who controls the blockchain nodes, and who sets the rules, are quickly becoming legal battlegrounds, especially as these systems cross national borders and jurisdictional boundaries blur. Courts may soon be forced to develop entirely new remedy frameworks to address “anchored-but-disputed” facts where a record’s cryptographic permanence conflicts with real-world error or injustice. Algorithmic decision-making layered on top of blockchain data also raises the issue of liability. If someone is denied access to a service based on flawed data or an opaque score or if the goal post shifts to assess such “access,” who is accountable: the government, the developer, or the data source?
Finally, equity and access loom large. Without safeguards, these systems risk excluding individuals who lack digital literacy, access to devices, or institutional trust, making it essential that lawyers remain vigilant advocates for fairness and procedural due process in the age of programmable identity.
The reality is that blockchain-equipped governments are no longer science fiction. The tools exist, but what doesn’t exist yet is a consensus on balance: how much oversight is too much? How much control is too little or too much?
As different states and countries adopt identity-on-chain systems, the legal profession must become the guardians of autonomy, defending individual rights against infrastructure overreach. Because when identity becomes programmable, the question isn’t whether we are visible, it’s who gets to see, who gets to deny, and who gets to judge. Block by block, we’re rewriting the contract between state and citizen.
