Can blockchain help the EU process asylum applications?
With the Russian invasion of Ukraine, the EU is once again experiencing an influx of migrants. The refugee crisis in the Middle East and North Africa in 2015 set records, with more than 1.3 million people seeking refuge in the EU.
However, the ongoing Russian invasion has already seen nearly 5.3 million Ukrainian refugees enter the EU. Although there is a distinction between the legal status of Ukrainian migrants and previous waves, migration flows to the EU have been increasing for years and remain an important political issue.
Entering through various border crossings and easily spreading across the continent, a key component that needs to be addressed is the cataloging of migrants. Blockchain technology, with its decentralization and level of encryption, can provide a comprehensive solution to this problem, and must be kept in mind by EU decision-makers when designing regulations.
Blockchain is a relatively new technology, invented in 2008, mainly to facilitate cryptocurrency transactions.
Although still a central use, blockchain also has a number of other uses, from addressing global development issues to digitizing public services. Its immutable and distributed nature provides a more secure network than traditional databases, removing the need for intermediaries to guarantee the security of the stored data.
Digital vs physical ID
This also makes it an important technological advance in digital ID creation; unlike traditional forms of identification, blockchain digital IDs will prevent fraud and protect against identity theft.
The network of IDs would be invulnerable to hacking, and the decentralized ledger means that the identifications can be accessed worldwide. In terms of migration and migration policy, this access and guarantee of authenticity is essential to identify and catalog refugees when they arrive at EU borders.
Some progress has already been made in using this technology for migration. The United Nations High Commissioner for Refugees has begun using biometric registration data to track refugees, and the United Nations World Food Program is using this information to make cash-based transfers in a Jordanian refugee camp through a pilot program, Blockchain against Hunger.
This approach to digitizing identification helps address some of the core challenges that refugees routinely face. With physical IDs, authorities store their data centrally on physical servers. This makes them vulnerable to external threats, such as hacking and even state failures.
When migrants flee their home country, their access to their government ID is severely limited, if not completely cut off, leaving them without identification and sometimes stateless.
With blockchain ID programs, identification would instead be stored digitally, available to the destination country upon the refugees’ arrival.
This not only allows the government of the destination country to track and catalog its new residents, but also gives the refugees easier access to social security programs. It also relieves some pressure on migrants, allowing them to focus on leaving their countries without worrying about retrieving documents.
The EU’s narrow crypto focus
The value of using blockchain technology to create and improve digital identification databases is impossible to ignore. It is crucial for decision makers in the EU to consider how over-regulation of blockchain could reduce positive benefits. Blockchain’s immutable and private nature must comply with the EU’s General Data Protection Regulation.
The EU’s current legal framework for blockchain focuses mostly on cryptocurrency and financial assets without looking beyond these. The European Commission is making an ongoing effort to combat financial crime by logging the identity of both parties involved in transactions to be handed over in the event of an investigation.
Such disclosure policies go against the core identity of blockchain, and with EU regulation often setting the global standard, other national governments may follow the EU’s lead.
However, this strict regulatory approach could be disastrous for the potential benefits of blockchain, especially towards migration policy. The goal should be to maximize the opportunities that come with the technology and work to standardize its use while providing a legal basis to protect users.
Current steps towards regulation send a signal that the EU is not a welcoming place for blockchain innovation, an action that will only continue to stifle the growth of the technology. However, as international borders become more porous, the EU’s current tactics do not support the improvement of its migration policy.
Asylum issues are one of the biggest problems with the EU’s migration policy, and digital identification through blockchain to register and track refugees will be an instrumental step towards the level of necessary reforms.
Over-regulation of this new and growing technology poses a risk not only to the investment potential of the EU as a whole, but also to migration flows across borders.
The migration crisis of 2015 was the first in a wave of asylum seekers, and the influx of Ukrainian refugees has continued to highlight the gaps in the system.
Without smart regulation of blockchain, the EU will lose the value of the technology before it has a chance to fully realize its potential.
