Blockchain in Education and Workforce: The Future or Fad?

Published jun. 12, 2018

You have probably heard about “blockchain.” It is the concept behind cryptocurrencies such as Bitcoin. More importantly, you may have been told that blockchain is a revolutionary way to manage data, with potential applications for education and workforce organizations. In fact, some have already begun experimenting with it in education and service provision.

But questions remain. How can economic mobility for low-income workers be addressed by education and workforce professionals through employing a blockchain solution, and what cautions should we consider before implementing it? To attempt to answer these questions, I spoke with experts Peter Shiau, of and co-founder of former company, and Cardin Campbell, a software engineer who is currently building a new proprietary app and company on blockchain.

Blockchain Primer
So, what is blockchain? While there is still debate, blockchain is generally considered to be a form of distributed ledger technology. It tracks a series of individual transactions between parties, and because it is “distributed,” the ledger is public and co-owned by the participants in the chain. Secondly, blockchain is not owned by any private party nor is it an actual piece of software or coding language—it is an open-source protocol or concept. Finally, the blockchain is highly secure through special “hashing” cryptography, and because participants in a blockchain all co-own the chain, all “blocks,” or individual transactions in the chain, are visible and verifiable by all. For this reason, it is considered a method for eliminating the need for trust among entities that don’t traditionally share vital information.

Potential to Reimagine Systems and Reduce Costs

Both experts encouraged me to think of blockchain as a way of completely changing the way certain processes are conducted, rather than just coding a paper process into blockchain. For instance, a blockchain could be constructed that verifies instructional hours as transactions between individual teachers and students and would be trusted and verifiable by all other students and teachers participating in that chain. The institution bestowing the degree is no longer necessary, and the student has more ownership over their own data than in current systems. They could give what is called a public key to their account, or “verified skills wallet,” to whomever they choose to share it with. This could significantly lower the cost of education. Shiau also described a process by which workers with a smart contract encoded in a blockchain could be paid instantly as they complete work—at the end of every hour or in even smaller time increments. Cash flow issues are common among low-income populations, and this could go a long way to help.

Streamlining Credentialing

Some in the education and credentialing space see blockchain as a vehicle for streamlining credentialing. Both Shiau and Campbell agree that blockchain could replace the need for a trusted entity, such as a school or training program, to issue and verify one’s credentials. Students may instead be able to participate in a postsecondary degree chain that is publicly available to show transactions between education institutions and students, including a complete list of skills mastered, academic and non-academic experience-based learning, and relevant transactions taking place outside the institution.

Co-Ownership of a Database

Blockchain eliminates the need for a trusted entity that is “in charge” of the data. Traditional data sharing among education and workforce agencies can be convoluted and ineffective, leading to breakdowns in communication and poor services. More resourced workers and learners can more easily navigate these issues than those with less resources. Shiau pointed out that multiple organizations must be committed to working together to solve the same problem. In other words, there’s not much reason for a blockchain in a single entity operating on its own or among a group that only occasionally exchanges information. For a group of organizations committed to working together closely to serve low-income workers and learners, however, blockchain may end up being a viable solution. On a technical note, it’s not clear whether a blockchain structure can operate like a relational database, which you are probably used to using (think Oracle or Salesforce). It is fundamentally a ledger of transactions without the functional complexity a database requires. Campbell noted that although most blockchains typically do not operate like databases, some newer (and largely conceptual) blockchain platforms, such as Hedera Hashgraph, have a method for incorporating a database.

The potential uses of blockchain to distribute data ownership and verify learning, however, beg a bigger question: why use blockchain if we can address these issues through tried-and-true approaches? If you are able to establish a trusted entity that owns a database on behalf of partners, there may not be a need for a distributed one on a blockchain shared by all partners. If the way we bestow and verify credentials already works, perhaps there isn’t a need to replace it with newer complex technology that most don’t really understand.

Problems with Blockchain

Kai Stinchcombe of Hackernoon makes the case that, in most of its applications thus far, blockchain hasn’t proven to be a better solution than traditional approaches. In the most well-known of blockchain applications, Bitcoin, there are a number of significant drawbacks, including its slow speed of transactions, inefficient use of processing power, and significant energy costs. There are potential applications of blockchain that operate differently than Bitcoin and could ameliorate these issues, but they remain largely theoretical.

While it is still too early to decide on blockchain’s capacity to improve education and workforce systems or processes, it holds both promise as well as caveats to implementation. Furthermore, even if it can create new efficiencies, does this increase equity and help low-income populations specifically? Perhaps, at least, it could represent a completely novel and efficient method of transacting that eliminates the need for trust and increases transparency in transactions, even democratizing vital data that was once privately held. But let’s not let the buzz behind blockchain outweigh the need for better understanding of the technology and carefully considering where it can be a better alternative to what already works.