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Blockchain technology provider BayaniChain has issued a press statement clarifying the technical and operational framework of the “Digital Bayanihan Chain” (DBC), the government’s blockchain-based national budget monitoring system, as mentioned by the Department of Information and Communications Technology (DICT) during a press briefing at Malacañang last week.
Bayanichain’s statement directly addresses recent inquiries regarding the project’s use of public blockchain standards and its implications for data sovereignty. However, it did not disclose the specific terms of its “no-cost” agreement with the government. Consequently, strict concerns raised by industry professionals regarding potential vendor lock-in and the commercial incentives behind the grant remain unaddressed.
The full statement from Bayanichain is available at the end of the article.
DBC: A ‘Public Reference Layer’
BayaniChain defined the DBC not as a replacement for existing government databases or legal workflows, but as a “public reference layer.”
- According to the firm, the system anchors official budget records — starting with the General Appropriations Act (GAA) — to a cryptographic ledger.
- This allows citizens, auditors, and media to verify if a document matches the original version approved by the legislature without relying solely on institutional assurances.
“Most transparency systems focus on publication. Publication alone does not establish whether a record remains final, whether it has been modified, or whether a copy matches the original,” the statement read.
Addressing Sovereignty and Neutrality
The nature of the project’s funding and infrastructure has been a point of contention.
- Previously, echoing the concerns of the wider tech and cybersecurity communities, technologist Ann Cuisia urged the Department of Information and Communications Technology (DICT) to disclose the terms of the “no-cost” deal, warning that grants from private entities are “rarely neutral” and could compromise digital sovereignty.
In its statement, BayaniChain defended the use of a public blockchain, arguing that public financial data requires a “neutral verification environment” where no single institution controls the ledger.
“This allows citizens… to confirm record integrity without credentials, permissions, or intermediaries,” BayaniChain stated, asserting that the system is designed to preserve “government control, data sovereignty, and long-term operational flexibility” despite the external infrastructure.
However, Bayanichain did not give further explanation regarding the specifics of the deal, leaving this issue raised by the tech community unaddressed.
Clarifying the Use of ‘NFTs’
The technical architecture of the DBC relies on ERC721A, a standard associated with Non-Fungible Tokens (NFTs).
BayaniChain emphasized that the system does not use this technology to create financial assets or collectibles. Instead, the standard was chosen to enforce “one-to-one uniqueness” for official records:
“There is no marketplace, no private ownership, no transferability, and no price mechanism. ‘Ownership’ in this context refers to institutional accountability, not economic right.”
The firm explained that the structure binds cryptographic hashes and timestamps to each record, ensuring that any alteration is “immediately detectable”.
Context: Scrutiny and Support
The DBC project was co-developed with the DICT and launched earlier this month. While DICT Secretary Henry Aguda and the Philippine Chamber of Commerce and Industry (PCCI) have lauded the initiative as a milestone for transparency and investor confidence, it has faced skepticism from the tech community.
Critics have raised concerns about the reliance on a grant from the Polygon ecosystem and the potential for vendor lock-in. BayaniChain maintained that the initiative operates as a “public infrastructure pilot” intended to make official documents consistent and traceable over time.
“Public data carries public consequence. It must remain verifiable, consistent, and resilient across political and institutional change,” the statement concluded.
Full Statement of Bayanichain:
PRESS STATEMENT
On the Digital Bayanihan Chain
The Digital Bayanihan Chain establishes a public reference layer for official budget records that can be independently verified over time.
Most transparency systems focus on publication. Publication alone does not establish whether a record remains final, whether it has been modified, or whether a copy matches the original. The Digital Bayanihan Chain anchors official data to a cryptographic ledger that allows any party to verify integrity without relying on institutional assurances.
This system was co-developed with the Department of Information and Communications Technology, beginning with the General Appropriations Act. BayaniChain designed and delivered the blockchain infrastructure at no cost to the Philippine government, providing the specialized cryptographic and public-verification systems required to make official records independently verifiable over time, while preserving government control, data sovereignty, and long-term operational flexibility.
The system does not replace existing databases, workflows, or legal processes. It adds a public verification layer that makes alterations detectable, establishes a stable reference point, and strengthens auditability.
The first phase anchors the enacted national budget to a public blockchain, creating a permanent cryptographic reference that corresponds to the version approved through the legislative process. Future phases extend this structure across the budget lifecycle, including releases, execution, and program-level records, so that official documents remain consistent and traceable over time.
A public blockchain was chosen because public financial data requires a neutral verification environment. No single institution controls the ledger. This allows citizens, auditors, journalists, and civil society organizations to confirm record integrity without credentials, permissions, or intermediaries.
Each anchored record is represented using a smart-contract structure derived from ERC721A.
This standard was chosen because it enforces one-to-one uniqueness, ensuring that each official record has a single, non-duplicable identity. Public records only work when there is one clear, authoritative version.
The structure binds cryptographic hashes, timestamps, and provenance references to each record. Any alteration becomes immediately detectable.
Records evolve through append-only references rather than edits, preserving a verifiable historical trail required for audit and dispute resolution.
The standard is also optimized for large-scale issuance, making it suitable for national systems that must anchor millions of records predictably.
In this architecture, NFTs function as an immutability framework—not as an application.
They establish a permanent cryptographic anchor for records, while the surrounding systems determine access, meaning, and legal effect.
These representations do not function as financial or collectible assets. They operate as cryptographic containers for public records. There is no marketplace, no private ownership, no transferability, and no price mechanism. “Ownership” in this context refers to institutional accountability, not economic rights.
All records are issued, controlled, and maintained by public institutions as part of official recordkeeping. The structure exists solely to guarantee integrity, provenance, and independent verification. In this system, ERC721A is not used to tokenize assets. It is used to anchor verifiable public truth.
The Digital Bayanihan Chain strengthens record integrity and auditability. It does not replace governance, enforcement, or cybersecurity practice. It provides a stable public reference when records are questioned, narratives diverge, or trust erodes.
This initiative operates as a public infrastructure pilot. It is designed to support future capabilities such as deeper traceability, analytics, and expanded public access while remaining under government authority.
BayaniChain will continue working with government partners, auditors, civil society, and the public as this system evolves. Public data carries public consequence. It must remain verifiable, consistent, and resilient across political and institutional change.
This article is published on BitPinas: BayaniChain Defends ‘No-Cost’ Blockchain Budget System; Explains Use of NFT Standards for Verification
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