Example on how Crypto can reduce corruption

[brawdias]

Crypto vs Corruption

For those who didn't know one practical example on how Bitcoin can fight corruption, I learned a very simple one, that I would like to share.

I remember when Brazil held an World Cup in 2014, and a few stadiums were caught in corruption scandals. The capitol stadium  was originally expected to cost $180m, but ended up costing $454m.(https://www.theguardian.com/world/2017/may/23/brazil-police-arrest-close-aide-president-world-cup).

Basically this was possible because they can easily inflate the cost of  a construction, in return for bribes from the company that built the stadium. This type of transaction can be manipulated, since they are controlled by the parts involved, and are hard to track. The investigations can take years, and the judging a couple more, due to lack of proof. They will usually allege that costs were inflated due to project adjustments, and they will actually show faked contracts.

If cryptography was used, as the form of payment for this project, in a way that allows the identification of each user of the money, we would be able to know how the money was spent, and make sure only the right people spend the money in the originally expected costs. The investigations would be much easier, cost a lot less, and the proof would come out by a touch of a button.

But as I said, the cryptography will have to allow the identification of the users, and rely the contracts in the expenses. The good news is that this is possible. They can actually base the coin on real money to reduce inflation. I would name this as the honest crypto.

Governments don't have the desire to do it, but we need to fight for it. I see this as a good way to engage more people, this is how we can grow the technology for the better.

[thefaucetrunner]

Given how fiat currency is manipulated, people's money is continuously going down in value. So the $500 I made last month is worth less this month. This is inherent to the banking system. But with a mined cryptocurrency, the supply is tied to the demand.

[Welsh]

You can view how much has been sent from a person/organization, however it's not going to show you what it was spent on. let's take the government for example some members of the government or representatives have been caught spending tax payers money on personal items such as cars and Ipods.  Using cryptocurrency doesn't prevent these sort of people from lying about where the money was spent it only shows us that it has been spent.

[rayk]

Good example, blockchain technology really has potential to end all the corruption in every industry. There are already many projects working on that I believe at least some of them will change those markets.

[richardsNY]

But with a mined cryptocurrency, the supply is tied to the demand.

Not really. If we look at Bitcoin's block rewards, they are constantly pushing the same number of coins into circulation, regardless of the actual demand. It's the price that corrects itself based on the actual demand in the market.

Using cryptocurrency doesn't prevent these sort of people from lying about where the money was spent it only shows us that it has been spent.

Correct, but the benefit is that all transactions once confirmed are logged in the blockchain for ever. If at some point in the future the people conducting illegal transactions drop their guard and spill important details, there is definitely a possibility that their transactions will be connected to them. On top of that, most of the newer users aren't all that aware of how everything works, so they likely assume that Bitcoin is actually anonymous, where they also don't know how using centralized services can make life very difficult for them, especially so with how exchanges force users to verify themselves.

[squatz1]

While this does seem like something which is good, this is one of the direct reasons that the government won't allow for bitcoin to go mainstream. If they do they're going to risk losing out on millions of dollars in corruption filled money. What's the upside in that for a company/government/person?

Nothing. If you rid out corruption from currency then they're going to go about it some sort of other way. Maybe giving people some other sort of asset. But if you say that bitcoin is going to be all telling with corruption then it's just not going to be allowed to go mainstream. That's the way it goes with these corrupt people.

[mrcash02]

You can view how much has been sent from a person/organization, however it's not going to show you what it was spent on. let's take the government for example some members of the government or representatives have been caught spending tax payers money on personal items such as cars and Ipods.  Using cryptocurrency doesn't prevent these sort of people from lying about where the money was spent it only shows us that it has been spent.

Addresses receiving public funds without a "register" or something like this would be easily spotted as corruption, embezzlement of public money.

If tax payers money is going to buy unnecessary items we would know because we would see the deposit addresses aren't related to the public outgoings addresses and the government's members doing this would be easily busted.

The problem are the overpriced contracts, in this case they make everything seems legal, hard to track the scheme. Something that costs $100.000 they will say it costs $200.000 because the competition among the contractors is faked. It takes too long to catch this kind of scheme.

[LillyBogan]

This is true and corruption can definitely stop with the help of bitcoins, this will be a big help to tax payers since we can track where our taxes are going. The big problem is that once corrupt world leaders knows about this technology, they will surely deny bitcoins and will ban them. That's how the world will turn upside down, the war between the countries that accepted crypto and the ones that prohibit it.

[KingScorpio]

Crypto vs Corruption

For those who didn't know one practical example on how Bitcoin can fight corruption, I learned a very simple one, that I would like to share.

I remember when Brazil held an World Cup in 2014, and a few stadiums were caught in corruption scandals. The capitol stadium  was originally expected to cost $180m, but ended up costing $454m.(https://www.theguardian.com/world/2017/may/23/brazil-police-arrest-close-aide-president-world-cup).

Basically this was possible because they can easily inflate the cost of  a construction, in return for bribes from the company that built the stadium. This type of transaction can be manipulated, since they are controlled by the parts involved, and are hard to track. The investigations can take years, and the judging a couple more, due to lack of proof. They will usually allege that costs were inflated due to project adjustments, and they will actually show faked contracts.

If cryptography was used, as the form of payment for this project, in a way that allows the identification of each user of the money, we would be able to know how the money was spent, and make sure only the right people spend the money in the originally expected costs. The investigations would be much easier, cost a lot less, and the proof would come out by a touch of a button.

But as I said, the cryptography will have to allow the identification of the users, and rely the contracts in the expenses. The good news is that this is possible. They can actually base the coin on real money to reduce inflation. I would name this as the honest crypto.

Governments don't have the desire to do it, but we need to fight for it. I see this as a good way to engage more people, this is how we can grow the technology for the better.

crypto will increase corruption vastly, you arent even able to imagine how much.

after a collapse of a state with a regulated financial cartel there is corruption everywhere

[kojoannan]

I don't think this how cryptocurrency can be use to reduce corruption. If you are talking about decentralized economy and an open /public ledger that tract every transaction on a blockchain is used ,fine, I will agree with it. But if that is even the case, I don't think those involve in the corruption will reveal the cryptocurrency used in order to avoid being traced.

[Tenderino]

Soon there will be people claiming that bitcoin can make you fly!

Sorry, but bitcoin will help to increase corruption because it can be done anonymously without any traces and it is not necessary anymore to have huge numbers of paper money on hand. Also, if the police want to make a trap with fiat money, they record the numbers of the bank notes and then later when you took it they catch you and have the proof!

[vintages]

From your story,  the only way cryptocurrency can be used is to view directly if the money has been paid and has reached the desired address because if it were to be the fait currency, there would have been a long protocol of viewing the transaction statement but with cryptos, it is fast. But on the other issue of allowing the identification of the users, it might not always work or else if you know the receiver in person.

[Darerando]

Block chain is transparent and immutable and in the fight against curroption, you need to keep records of information that can not be change. In that sense there won't be curroption

[luckybit1]

Blockchain has an arrangement to build voter turnout and make race altering incomprehensible. A decentralized record of all votes cast in any race could be kept on blockchain records, which can't be adjusted or changed without leaving evident hints of altering over the whole 'chain