Beyond Crypto: How Blockchain Is Being Rebuilt as Infrastructure for Development

The UNDP report shows how blockchain, when carefully governed, is being used to make payments, climate finance, identity, and public services more transparent, inclusive, and trustworthy. Rather than promoting hype or disruption, it positions the technology as shared digital infrastructure that helps governments coordinate better, protect public value, and keep control in a fast-changing digital world.

Development policy is being reshaped by forces moving at unprecedented speed. Climate shocks are intensifying, public budgets are under strain, and digital systems now underpin everything from welfare payments to carbon markets. Yet many public institutions still operate with tools and processes designed for a slower era. According to a new report by the United Nations Development Programme’s Alternative Finance Lab, produced with UNDP’s Innovation and Digital Team, the Istanbul Regional Hub, and country offices across the world, this growing mismatch between digital change and public capacity risks locking countries into systems that are efficient but not fair, fast but not accountable.

The report argues that the challenge facing governments today is not whether to adopt digital technologies, but how to do so without losing control. Early waves of digital reform often relied on closed platforms and private intermediaries, limiting transparency and leaving little room for public oversight. UNDP’s work starts from the premise that digital infrastructure must be shaped around public purpose, not the other way around.

Why Blockchain Is Showing Up in Development Work

Blockchain is often associated with cryptocurrency speculation, but the report strips away that image. At its core, blockchain is described as a shared digital record that cannot easily be altered. It allows multiple actors, governments, communities, donors, and private partners to see and verify the same information without relying on a single controlling authority.

In development settings, this matters because trust is often weak and systems are fragmented. Blockchain can make payments traceable, records auditable, and rules transparent. At the same time, the report is clear that the technology carries risks. Poor design can undermine privacy, expose users to fraud, or shift power from public institutions to technology providers. For UNDP, blockchain is not about “trustless” systems, but about building better, more accountable forms of trust.

Making Payments Work for People at the Margins

One of the clearest use cases in the report is digital payments. Across Africa, Latin America, the Caribbean, and fragile contexts, UNDP-supported pilots are testing new ways to move money to people who are often excluded from formal banking. These include digital wallets that work on basic phones, stablecoin-based transfers that reduce delays in conflict zones, and purpose-bound digital tokens that help women and youth entrepreneurs spend grants on approved business needs.

The goal is not to replace national payment systems, but to create shared “rails” that can support social protection, humanitarian assistance, remittances, and local commerce at the same time. By generating transparent records of who received what and when, these systems also make oversight easier for governments and donors.

From Identity to Climate Finance, Trust Is the Common Thread

Beyond payments, blockchain is being used as a verification layer for public services. Universities issue digital diplomas that employers can check instantly. Health programmes test privacy-preserving systems that let people prove eligibility for services without revealing their identity. Humanitarian agencies coordinate aid distribution using shared records that reduce duplication and exclusion.

Climate finance is another major focus. The report shows how blockchain can link global funding to local action by tracking adaptation grants, forest restoration, carbon credits, and weather data. For communities and small farmers, this can mean access to finance that was previously out of reach due to high verification costs. For governments, it offers clearer oversight and reduces the risk of double-counting and misreporting.

Technology as a Bridge, Not a Replacement

Throughout the report, UNDP returns to one central message: blockchain is not a substitute for institutions. Instead, it can act as a bridge between public and private finance, global markets and local communities, innovation and regulation. The organisation’s approach is deliberately cautious, built around experimentation, learning, and strong safeguards rather than rapid scaling.

By treating blockchain as infrastructure rather than ideology, UNDP aims to help governments stay in the driving seat as digital systems reshape development. In a world where trust in institutions is under pressure, the report suggests that the real value of new technology lies not in disruption, but in coordination, making it easier for societies to see, verify, and govern the systems that shape their futures.