This article originally appeared on Law360, and is republished with permission.

Homeless and transitory populations across the country face numerous challenges attempting to find health care, mental health resources and other government services. As a population without access to stable residences, maintaining documents to prove identity, medical history or documents related to human services is often problematic. Something as simple as proving identity can be a real problem for people who don’t have ready access to identification documents.

In 2018, the city of Austin, Texas, proposed a program to use blockchain technology to associate homeless and transitory residents of the city to the records necessary to receive services.

What Is Blockchain?

Blockchain technology has been most closely associated with cryptocurrencies such as bitcoin as a mechanism to provide trust in digital transactions. The concept for blockchain predates cryptocurrencies by several decades, however. Blockchain builds upon multiple other technologies: asymmetric encryption,[1] Merkle trees,[2] key-value databases and hash functions — both dating to the 1960s. It was Satoshi Nakamoto (the pseudonym of an individual or a collective) who, in 2008-2009, combined these technologies with peer-to-peer communication protocols and proof of work producing the first blockchain implementation to secure the cryptocurrency bitcoin.

Blockchain is often described as a public, distributed database of read-only blocks of data which uses encryption to protect the data in each block. As used in the cryptocurrency world, a transaction is created, this transaction — a cash transfer or sale of goods — is combined with other transactions created at the same time into a “block." The block is then transferred to multiple computer systems for verification. In the world of cryptocurrencies the owners of the computers used for verification, called “miners,” are rewarded for the efforts with a fraction of the cryptocurrency.

If the miners are able to verify the block, it is added to the blockchain. Since the blockchain is public, anyone with a copy of the blockchain can validate the transactions. If an attacker attempts to alter any block everyone with access to the chain will know data has been compromised. Since the blockchain uses encryption and hashing technology, attacks against the blockchain are complex and computationally expensive. In the world of cryptocurrencies, these elements — public, distributed and encrypted — provide an excellent solution to the challenge of trust in digital transactions.

Challenges Facing the City

The city of Austin’s program aims to develop a blockchain solution to solve a challenge related to serving the homeless population. According to their proposal for the Bloomberg Mayor’s Challenge, a competition created by Bloomberg Philanthropies to inspire innovation in cities:[3]

For the more than 7,000 people who experience homelessness in Austin, lack of ID can mean barriers to, or delays in, their access to housing, employment, and other services critical to dignity, support, and recovery.

The City of Austin will use blockchain technology to provide homeless residents with a unique identifier that allows them to access their personal records at any time, enabling access to critical services.

So at its core, the program is focused on solving an identity proofing challenge. Since the homeless residents of Austin may have difficulty locating, holding and securing identification, utilizing technology to prove identity seems logical. There are technological and social hurdles the city will need to overcome.

Technology Isn’t the Challenge

Creating the infrastructure for a blockchain is not the difficult aspect of the project. The building blocks of a blockchain project are well established: an application which is installed on a computer system, a shared ledger, a consensus algorithm and a virtual machine.

Similarly, there are three distinct components that handle the public key encryption, digital signing and authentication: 1) a registration authority verifies the user’s certificate request and tells the certificate authority whether or not to issue the certificate; 2) a certification authority issues a digital certificate; and 3) a validation authority verifies the validity of a digital certificate. Each of these components is well established.

Implementation and Social Acceptance

First, the new user will have to be identified and authenticated. The impetus of the project is that it is difficult to prove the identity of homeless residents of the city when they lack regular documents such as ID cards, social security cards, birth certificates, etc., so we are back to step one. The city has stated that it can take considerable time to retrieve identity documents, health records and determine eligibility for social services. It will likely take just as long to authenticate a resident and complete the initial enrollment process.

The good news is that once the resident is has gone through the initial enrollment process, the blockchain will maintain that record in perpetuity. The resident will be able to retrieve and grant access to their data based on the blockchain records, rather than having to maintain paper documents.

Retrieving Residents' Records

In most blockchain applications users identify themselves using either a username and password combination, a hardware token, mobile device or a software key. In the realm of authentication, there are three possible factors that can be used: something you know (like a password or pin), something you have (like a mobile device or hardware token), and something you are (biometric data).

The city understands that everyone struggles to remember usernames and passwords and that many struggle to retain hardware tokens. The homeless community is no exception. In many commercial applications, mobile devices (phones or tablets) are used as an authentication token (something the user has). Homeless residents of the city, though, may not have access to a smartphone or tablet, so the city needs another method to connect a person with identity. If the city can’t rely on something the resident knows or something they have, the only possibility left is something they are: biometrics.

Many case workers and social workers carry mobile devices (phones or tablets) to capture field report data. These mobile devices can be fitted with biometric readers and used to access the blockchain. How, though, can the resident validate themselves on a third-party, city-owned mobile device?

A secondary benefit of the program, aside from streamlining the identification process, is that blockchain technology gives the user more granular control over access permissions. IBM Corp., as an example, has devoted significant research and development resources into a blockchain for managing health information. In the IBM model, any provider who is granted access by the patient, is able to add health records to that patient’s history on the blockchain. Thus, over time, a complete and portable health record is developed.

In a similar manner, the city of Austin blockchain will allow for a participant in the program to build their own history — whether medical records, eligibility for government services or a combination of the two — and make portions of the history available upon demand.

As the program involves personal information, including the potential to capture medical and mental health data, the program must comply with federal regulations such as the Health Insurance Portability and Accountability Act.

Will Homeless Residents Participate?

One question that needs to be addressed is whether the homeless will participate in the program. Mental health conditions, lack of trust in government, and other psychological blocks may make homeless residents unwilling to cooperate with a program that is focused on tracking location, health information and government services. No matter how well-intentioned, some will view the government with hesitation. This hurtle may be more difficult to overcome than the technological challenges.