A key feature of blockchain architecture are smart contracts, which allow digitized agreement terms and conditions to be self-executed once the predefined rules between parties are met. This Web3 distributed application ("dApp") creates a smart contract for each grant letter to automate enforcement of spending controls and payment rules and simplifies reporting. This is a fully functioning proof-of-concept to prove that it is possible to adapt this functionality to create smart grants and indicates blockchain could transform government operations by tackling some of government financial management’s biggest challenges, especially those concerning internal controls. It confirms two notions: 1) blockchain can improve the detection and prevention of improper payments; and 2) blockchain can reduce the reporting burden for grant recipients.
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