USAID to Restructure, Integrate Blockchain, Focus on U.S. Interests

The Trump administration has recently announced its plans to restructure the United States Agency for International Development (USAID), with a notable emphasis on integrating blockchain technology into its operations. This move comes after significant changes within the agency, including job losses and the elimination of many foreign aid contracts, following President Trump's collaboration with Elon Musk to streamline government agencies. The proposed restructuring aims to focus USAID's efforts on global health, food security, disaster response, and countering China, while addressing what the administration perceives as inefficiencies and fragmentation in current development programs.

The administration's plan seeks to concentrate USAID's resources on areas that align with U.S. interests, such as promoting peace, stability, and economic opportunities that benefit American businesses. The proposal also highlights the need to address global threats like pandemics. A key aspect of the restructuring is the implementation of clear end dates for all aid programs and rigorous measurement of their success. The goal is to significantly reduce the agency and then rebuild it under a new framework that reflects the administration's priorities.

As part of this reorganization, USAID will be renamed the U.S. International Humanitarian Assistance Agency (IHA) and brought directly under the leadership of the Secretary of State. The agency plans to leverage blockchain technology to enhance the security, transparency, and traceability of its aid distribution processes. However, the specifics of how blockchain will be used—whether through cryptocurrency, stablecoins, or simply as a tracking tool—remain unclear. This announcement comes at a time when USAID staff are uncertain about the agency's future, following significant cuts and administrative changes under the Department of Government Efficiency.

Critics have raised questions about the necessity and feasibility of using blockchain technology in this context. Linda Raftree, a consultant helping humanitarian groups adopt new technologies, argues that blockchain is often an unnecessary solution, as existing tools can achieve similar results. Giulio Coppi from Access Now also notes that blockchain offers no clear advantages over other tools like payment systems and has shown little real impact in the humanitarian sector. Despite these criticisms, there have been successful blockchain projects in the sector, such as the UNHCR’s pilot project providing stablecoins to Ukrainians and trials by the Kenya Red Cross. However, the adoption of blockchain at USAID aims to tie funding to results, which some employees argue may not be flexible enough in disaster or conflict zones. Critics like Linda Raftree feel this push supports claims of corruption within USAID, even though the agency already pays based on completed work.

The proposed restructuring of USAID represents a significant shift in how the agency operates, with a clear focus on enhancing security, transparency, and traceability in aid distribution. While the specifics of the implementation remain unclear, the administration's priorities are evident. The success of this restructuring will depend on how effectively the challenges are navigated and whether the changes lead to improved outcomes for those in need. The administration's plans to overhaul USAID with blockchain technology are part of a broader effort to modernize the agency and align its goals more closely with U.S. foreign policy objectives, particularly in regions where national security interests are at stake.