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The Philippines is making headlines as the first country to implement a fully on-chain national budget starting with the 2026 General Appropriations Act (GAA), a move the Department of Information and Communications Technology (DICT) hails as a leap for transparency.
However, as officials promote the blockchain-powered “Digital Seal of Truth,” experts are raising concerns over bold security claims, opaque funding sources, and questions about whether the system provides genuine accountability or merely high-tech optics.
Key Details
During a press briefing at Malacañang, DICT Secretary Henry Aguda announced the milestone and described it as a “leapfrog” moment for digital governance:
“The Philippines is the first legislative body in Asia to use blockchain for the national budget and the first country in the world with a fully on-chain national budget. While other countries use blockchain only for portions of their budget, this year… the Philippines will place the entire budget cycle on a tamper-proof system”.
BayaniChain and the ‘Consortium’ Model
BayaniChain and Polygon
While the project aims to cover the entire government bureaucracy, the initial development was executed at “no cost to the government” through a private sector grant.
Secretary Aguda revealed that the agency partnered with local blockchain technology provider BayaniChain to build the initial infrastructure.
“The grant didn’t go to DICT. We partnered with a company called BayaniChain and they were the ones who did work for us,” Aguda confirmed, estimating the value of the grant to be “substantial,” potentially worth “a few million”.
This information was earlier reported by this publication in October last year, as confirmed by both the DICT and representatives of Polygon, the blockchain company whose foundation awarded the grant. (Read More: Exclusive: DICT, Polygon Confirm Talks for $5M-$10M Grant to Track PH Budget on Blockchain)
Consortium Blockchain Model
The roadmap involves a transition from a public blockchain to a “Consortium Blockchain” owned by the government. DICT Undersecretary David Almirol explained that this private, permissioned network will be anchored by three specific nodes representing the country’s fiscal watchdogs:
- Department of Budget and Management (DBM)
- Department of Information and Communications Technology (DICT)
- Commission on Audit (COA)
“We will form a consortium blockchain. This means we own the nodes,” Almirol said. “If DBM inputs budget data, DICT and COA see it immediately… There will be no ghost projects here”.
The ‘Digital Seal of Truth’ and CADENA Bill
According to the DICT, the primary goal of the system is to solve the issue of “traceability.” Currently, budget documents pass through numerous offices and undergo multiple revisions, making it difficult to verify the “final” approved copy years later.
Aguda emphasized that the blockchain serves as an immutable integrity layer:
“Starting with the 2026 General Appropriations Act, there will be a Digital Seal of Truth… As they say, in the 2026 budget, there is ‘forever.’ You can scrutinize it forever”.
The full-scale expansion of the project relies on the final passage of the CADENA Bill (Citizen Access and Disclosure of Expenditures for National Accountability Act) into law. Aguda identified this Sen. Bam Aquino-authored legislation as the key to securing the specific budget allocation needed to migrate the system from the initial public chain to the government-owned infrastructure by 2027. (Read More: Sen. Bam Aquino’s ‘Blockchain Bill’ Rebrands to ‘CADENA’: Targets 2026 Phase 1 Rollout)
Industry Reactions: Experts Flag Security and Transparency Concerns
Following the announcement, local technology and cybersecurity experts expressed skepticism regarding the government’s claims, particularly concerning the security guarantees and the technical implementation of the transparency features.
The “101% Hack-Free” Myth
Ann Cuisia, fintech executive, tech opinion writer, and Trustee at Qadena Foundation, raised concerns about the DICT’s assurance that the system is “101% hack-free.”
In an opinion piece dated January 15, Cuisia argued that such language causes alarm within the cybersecurity community, noting that “no serious security professional speaks that way.” She cited high-profile blockchain exploits — including the $1.5 billion Bybit theft (Feb 2025) and the $615 million Ronin bridge hack (March 2022) — as evidence that the technology is not invulnerable.
“When a government agency uses ‘101% hack-free’ language, it does not reassure experts. It creates doubt about whether risk is being taken seriously.”
Ann Cuisia, Trustee, Qadena Foundation
Art Samaniego Jr., technology editor and Founder of Scam Watch Pilipinas and Tech Watch PH, also challenged the DICT’s assertion that blockchain was created by cybersecurity specialists:
“There is no evidence that the original Bitcoin developers were a group of ‘cybersecurity specialists.’ The design came from cryptography research, distributed systems, game theory and economics… Blockchain was designed to remove trusted intermediaries, not to function as a cybersecurity defense system.”
Art Samaniego Jr., Founder, Scam Watch Pilipinas
PDF Archiving vs. True Traceability
Experts also questioned whether the initiative constitutes genuine transparency or merely digital archiving. Cuisia argued that if the project simply involves tokenizing PDF documents (hashes) on a blockchain, it functions as a “high-tech filing cabinet” rather than a tool for accountability.
“Blockchain’s value in governance is not document storage. It is event recording: approvals, releases, obligations created, funds moved. A document hash only tells you a file existed at a certain time. It does not show who approved a release… or how money moved after”.
Ann Cuisia, Trustee, Qadena Foundation
Sovereignty and Incentives
Concerns were also raised regarding the project’s reliance on public Layer-2 networks and private grants. Cuisia noted that public networks operate under governance models outside Philippine state control. She also called for scrutiny regarding the “substantial” grant mentioned by Sec. Aguda.
“In technology ecosystems, large grants are rarely neutral. They are strategic instruments used to drive adoption [and] lock in usage patterns,” Cuisia warned. She emphasized the need for the government to disclose the terms of the grant to prevent potential vendor lock-in or influence over future procurement.
This article is published on BitPinas: Philippines to Implement World’s First Fully On-Chain National Budget; Experts Challenge ‘Hack-Free’ Claims and Utility
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