Council cautiously supports city’s look into blockchain, crypto

City Council members want city staff to move very deliberately if a pair of resolutions are passed today that encourage exploration into the use of blockchain and cryptocurrency technologies in the coming years.

At Tuesday’s work session, discussion on the resolutions put forth by Mayor Steve Adler and Council Member Mackenzie Kelly focused on how strongly the language should advocate for early adoption of the technologies. Council Member Kathie Tovo offered amendments that would direct study before moving toward support of development of applications for city use.

Tovo also stated the need to study the energy consumption and environmental impacts of both technologies, which record transactions and documents in unbreakable digital ledgers. She said the study should include examination of how public banks and alternative payment platforms that may use blockchain could be beneficial to those without ready access to banking.

Adler’s blockchain resolution included a list of 20 possible city functions that could potentially be converted and streamlined using blockchain.

“I think we need a check back before we’re asking the manager to create and develop the whole long list of things that were included here,” Tovo said. “Many of them will be very useful, but you would have them actually developing and creating some of these things, including public banks and complementary currencies that I’m super supportive of exploring … I just don’t know that we’re ready at this point to create them.”

Adler said he wanted the resolution to be as encouraging as possible so the city can interact with startups and others involved in blockchain in the private sector in Austin.

“We are early in the process where we may want to develop technologies and encourage people,” he said. “We have creators and movers in this technology and they have the opportunity to see what kinds of services they could bring to use, or what kinds of uses there could be, so it’s more than just studying at this point for a value determination.”

To date, the city’s most advanced move into examining uses of blockchain came from the Innovation Office’s grant-funded work to develop a system that would allow for easy conversion and storage of vital personal documents for the homeless and others who may be prone to losing things.

Others on the dais, including Council Member Leslie Pool, expressed concern about the decentralized nature of the technologies and the volatility of cryptocurrencies such as Bitcoin that would make it prohibitive to accept as currency in payment for city services or obligations.

Mayor Pro Tem Alison Alter said the city may be moving too quickly toward an emerging technology such as blockchain when there are lingering difficulties with moving beyond hard-copy paper transactions and record-keeping.

“With respect to the resources, we have some really basic technology challenges that we have not mastered like electronic time sheets and a human capital management system, and so I worry about us going into blockchain and these fancy things when we have some real basic technology challenges we need to be focusing our energy on,” she said. “I’m comfortable that this is an open invitation to explore and participate in conversations and be able to seize the opportunity or not shut the door, but there are some basic technology things that as a city we’re not adept at.”

Council Member Ann Kitchen countered Alter by noting that new innovations with emerging technology could give the city the boost it needs to solve lingering issues or make advancements in older initiatives, such as a years-old plan from the Innovation Office for the city to go paperless.

“Sometimes with our basic problems it is newer technologies that can help us answer them, so there is potential in some of this … blockchain in particular is very interesting,” she said. “That could help us be more up to speed on how we operate so we’re not as paper-based.”

Photo made available through a Creative Commons license.

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