Opportunities and Barriers of Using Blockchain in Public Administration: The Case of Real Estate Registration in Kazakhstan

Abstract

Blockchain technology has a great potential for improving public administration – its transparency and efficiency. It is also discussed as an instrument for reducing corruption and transaction costs. This paper discusses the potential use of block-chain technology in public administration. It is based on a case-study approach focusing on real estate registration in Kazakhstan. Particular attention is paid to identifying factors hindering the development of the blockchain technology. The paper indicates that the main barriers to further use of blockchain technology in Kazakhstan are insufficient legislation and also the complexity of the technical implementation of blockchain projects and integration with existing systems.

Blockchain in real estate: Recent developments and empirical applications

“…Overall, the governments retained a central role in land administration blockchain applications (Akhmetbek and Špaček, 2021;Allessie et al, 2019;Bennett et al, 2021;Kshetri, 2021;Lazuashvili et al, 2019;Lemieux et al, 2020;Rodima-Taylor, 2021), confirming the theory that blockchain has not been disintermediating the real estate sector. The empirical insights proved that removing the governmental role has not been the target of many applications (Rodima-Taylor, 2021;Akhmetbek and Špaček, 2021;Kempe, 2017).…”

“…Because most of the blockchain applications assessed empirically were hybrid applications where blockchain was added on top, the government's role in land administration processes might increase, as estimated, for example, in the Swedish application (Rodima-Taylor, 2021). Overall, the governments retained a central role in land administration blockchain applications (Akhmetbek and Špaček, 2021;Allessie et al, 2019;Bennett et al, 2021;Kshetri, 2021;Lazuashvili et al, 2019;Lemieux et al, 2020;Rodima-Taylor, 2021), confirming the theory that blockchain has not been disintermediating the real estate sector. The empirical insights proved that removing the governmental role has not been the target of many applications (Rodima-Taylor, 2021;Akhmetbek and Špaček, 2021;Kempe, 2017).…”

“…Overall, blockchain applications might help reduce some types of fraud, but leave doors open for others (Lemieux, 2017a(Lemieux, , 2016Kempe, 2017). Overall, the empirical insights have supported that blockchain could indeed increase security, at some level (Konashevych, 2021;Kshetri, 2021), for users (Kempe, 2017), especially for data (Allessie et al, 2019;Akhmetbek and Špaček, 2021;Lazuashvili et al, 2019).…”

“…The second most often mentioned theoretical blockchain benefit for the real estate sector has been efficiency. The empirical findings indicated that blockchain application could indeed increase efficiency in the real estate sector (Alketbi et al, 2020;Allessie et al, 2019;Bennett et al, 2021;Shang and Price, 2018;Kempe, 2017 Mar), reduce time (Akhmetbek and Špaček, 2021;Rodima-Taylor, 2021;Kempe, 2017;Alketbi et al, 2020;Allessie et al, 2019), provide automation (Akhmetbek and Špaček, 2021;Alketbi et al, 2020;Bennett et al, 2021;Chang and Wang, 2021;Kempe, 2017 Mar), and simplify current processes (Akhmetbek and Špaček, 2021;Allessie et al, 2019;Bennett et al, 2021). The empirical studies also suggested that blockchain in real estate could increase verifiability (Kshetri, 2021;Shang and Price, 2018;Goderdzishvili et al, 2018;Kempe, 2017;Chang and Wang, 2021) and transparency (Alketbi et al, 2020;Allessie et al, 2019;Bennett et al, 2021;Lazuashvili et al, 2019;Chang and Wang, 2021;Kempe, 2017 Mar).…”

“…Kshetri also reported cyberattacks on recently digitized centralized records in India, leading to approximately 3 million land property disputes in 2018 (Dinesh Kumar and Manaswini, 2021). The digital registry adopted in 2013 brought significant efficiency advantages in Kazakhstan but left the centralized system prone to fraud and technical failures (Akhmetbek and Špaček, 2021). In Georgia, building a digital land registry database did not fully solve the public trust crisis in government agencies because there were concerns of corruption and cyber threats toward the centralized database (Shang and Price, 2018).…”