Philippines unleashes blockchain bombshell: Govt projects get bulletproof tracking

Manila: The Philippines has launched a first-in-the-world drive to track budgets and contracts using blockchain technology.

The new drive is a whole-of-government project.

Meaning: it covers the entire government. All contracts entered into by every agency or branch will be "chained" or linked together, in a public ledger, following pre-set data points.

According to the Department of Information and Communications Technology Secretary Henry Aguda, these ledgers are nearly impossible to decrypt or hack.

First-in-the-world system

Secretary Aguda told local media that placing the national budget on the blockchain ensures the integrity and transparency of public funds.

The Philippines has the first legislature in Asia to use blockchain for the national budget, and the first country in the world to have a fully on-chain national budget.

Starting in 2026, the General Appropriations Act (GAA) will carry a digital seal of truth — an official copy that anyone can verify, even years later.

Blockchains facilitate smart contracts via self-executing code on the blockchain, automate approvals and releases.

For instance, funds disburse only when milestones like geo-tagged project progress (verified via satellite imagery in initiatives like Project DIME) are met.

Public access via dashboards lets citizens, auditors, and watchdogs verify in real-time.

Potentially, this could get rid of "ghost projects" where billions vanish into thin air, as exposed in past Department of Public Works scandals.​

Blockchain, powered by massive and distributed data centres and high-speed "mining" computers, does to transactions as livestreaming is to television.

Combatting corruption

The initiative stems from ongoing efforts to combat corruption, especially following scandals involving infrastructure projects like flood control, which originate from intractable "budget insertions".

In so doing the Philippine government will build up verifiable records for public spending, an "on-chain" national budget starting with the 2026 General Appropriations Act (GAA), according to Bitpinas.

The move is done in partnerships with private blockchain entities, positioning the country as a leader in digital governance in Asia.

Key initiatives

Several programs and laws are driving this adoption:

• Digital Bayanihan Chain (Transparency Portal):

  A blockchain-based platform managed by the Department of Information and Communications Technology (DICT) that records the entire national budget cycle, including allocations, disbursements, and procurement transactions. It's mandated by the CADENA Act (Citizen Access and Disclosure of Expenditures for National Accountability), requiring agencies to upload detailed documents for public access and auditability, according to opengovasia.com.

• Integrity chain:

  Launched in September 2025 by the Department of Public Works and Highways (DPWH) in partnership with the Blockchain Council of the Philippines (BCP) and DICT. This targets infrastructure projects, tracking contracts from budget release to completion on a decentralized ledger. It uses BayaniChain's platform (built on Polygon, a Layer-2 Ethereum solution) and involves multi-sector validators like NGOs, academe, and media to prevent tampering, as per Coingeek.

• Philippine National Blockchain Act (Senate Bill No. 1330):

  Proposed by Senator Bam Aquino, this bill aims to embed blockchain into budget management for real-time monitoring of funds. It's declared urgent by DICT and could make the Philippines the first with a comprehensive on-chain budget if passed. scmp.com

These efforts align with President Ferdinand R. Marcos Jr.'s directive to use technology like blockchain and AI to ensure every contract, disbursement, and project is timestamped and traceable.

How it works

Blockchain creates a tamper-proof digital ledger where each transaction—such as contract awards, payments to contractors, or project milestones—is recorded immutably.

For government contracts:

• Data is logged in real-time, with timestamps and hashes to prevent alterations.

• Public access allows citizens, auditors, and researchers to verify records independently.

• A permissioned consortium network (involving DBM, DICT, and COA) ensures secure data sharing, with plans to transition from public chains like Polygon to a government-owned system by 2027, according to Bitpinas.

• Initial focus is on high-risk areas like DPWH's 20,000–25,000 annual projects, starting with foreign-assisted ones as a proof-of-concept.

Challenges and criticisms

While promising, the initiative faces skepticism:

• Technical risks: Experts warn that blockchain isn't "hack-proof" (despite DICT claims), citing past exploits like the Ronin bridge hack. Reliance on private grants (e.g., Polygon's $5M–$10M funding) raises concerns about sovereignty and vendor lock-in. bitpinas.com

• Implementation hurdles: Scaling to millions of transactions could strain infrastructure. Success depends on accurate data entry and active participation from validators; without it, the system could fail. coingeek.com

• Limitations: Critics argue it may only archive documents rather than fully track dynamic events like fund movements, and deeper governance reforms are needed beyond tech hype. scmp.com

• Public Engagement: Recent X discussions highlight enthusiasm for blockchain in education and transparency but note foundational issues like education gaps that could hinder adoption.

Takeaways

Overall, this represents a bold step toward accountable governance.

However, its effectiveness will hinge on robust execution and complementary reforms.

For the latest developments, monitoring official DICT updates or legislative progress is recommended.

Manila's move, a first-in-the-world blockchain solution to track government contracts, is a groundbreaking solution.

Corruption plagues public spending in the Philippines, thus making the pioneered blockchain technology transparent, able to track government contracts and budgets with unbreakable transparency.