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How Blockchain Could Help Refugees with Proof of Identity

Last Updated March 4, 2021 4:49 PM
Lester Coleman
Last Updated March 4, 2021 4:49 PM

Blockchain technology may help refugees maintain legal identity and have access to relief services when they cross borders, according to Staci Warden, executive director of the Center for Financial Markets at the Milken Institute, writing in The Wall Street Journal .

Staci Warden
Staci Warden

Refugees often have their IDs confiscated when they leave their country of origin. Without proof of citizenship, they find themselves in legal limbo. Their problems are compounded by having bank accounts confiscated when they leave their home country.

After crossing borders, migrants often lack access to economic and social infrastructures, including the global banking system.

Asylum Destinations Pressed

Not having proof of citizenship also creates problems for countries accepting refugees and for relief organizations. In Syria, the fight against terrorism makes efforts to assist refugees more difficult.

Blockchain technology can address most of these issues, Warden noted. A common ledger like blockchain allows every party to view information the same way that multiple users can work on shared computer documents.

Should a refugee arrive from Syria in Greece, the border officials could check their identity on the ledger housing the refugee’s ID and even their biometric information. The ledger is tamper proof, meaning the refugee’s account of who they are, where they have been and who they know can be verified.

Empowering Refugees

The refugee could choose to reveal only as much about themselves as needed for the transaction they undertake.

With blockchain technology, refugees would have more access to the banking system, but banks would be less critical to refugees. Relief organizations would be able to wire funds to refugees immediately and directly in the form of vouchers or tokens. With no middlemen, more of the money would go to the person in need.

Various initiatives have attempted to apply blockchain technology to the Syrian crisis.

Bitnation has tried to help Syrian refugees, but its success has been compromised since most retailers in the region don’t accept bitcoin. Another project called NevTrace has recently tried to help Syrian refugees, but it’s very new. Relief organizations nonetheless could wire funds to people directly using blockchain technology.

Also read: Developer creates block chain passport technology based on bitcoin

Blockchain Not A Panacea

Blockchain technology does not prevent terrorism financing or money laundering, Warden noted. A fake identity can enter the blockchain ledger. Banks have to prevent such problems with Know Your Customer programs. Such programs will become easier with third-party verification measures.

Nonetheless, the blockchain is a widely distributed system that enables verifiable and easily obtained information about individuals, their transactions and movements. It can hedge against political turmoil and enable a refugee to maintain power and dignity of proven identity, despite the political collapse of their nation’s government and their physical circumstances.

Featured image from Shutterstock.