Bitgo CEO Mike Belshe has argued that a public blockchain could serve as a practical tool to reduce fraud in state and federal spending. His proposal centers on putting certain government disbursements, especially payments to non-governmental organizations, on a transparent blockchain such as Ethereum, while publishing the relevant transactions and recipient addresses for broad public review.
The idea arrives as U.S. officials place renewed attention on fraud tied to public programs and government funds. According to the report, losses linked to these issues could reach as much as $521 billion annually. In a social media post, Belshe said there is a way to address state and federal fraud without replacing existing money systems: move the money onto a public blockchain. His argument is that transparency itself could become a strong enforcement layer, with citizens helping monitor how funds move.
Transparency as a Layer of Public Oversight
Belshe’s position is rooted in the auditability of blockchain networks. Public ledgers allow transactions to be tracked, verified, and reviewed by outside observers, which could make it harder to conceal suspicious flows of public money. In theory, that would improve accountability for grants, aid programs, and institutional payments. The report, however, does not detail how such a system would address privacy concerns, government compliance requirements, or the technical process of integrating public finance systems with blockchain infrastructure.
The political backdrop also matters. The article says the Trump administration has publicly framed fraud as a major problem and appointed Vice President Vance to focus on anti-fraud efforts, with attention directed toward Democratic-led states including California, Illinois, Minnesota, Maine, and New York. In California, eight people were recently arrested over an alleged healthcare fraud scheme worth more than $50 million. The U.S. Treasury has also said complex fraud rings in Minnesota have stolen billions from state programs.
Russia’s Digital Ruble Offers a Different Model
The report also points to Russia, where authorities have been testing the digital ruble for government budget disbursements. After limited trials in 2025, the system was expanded in January 2026 to support all federal payments. Russian officials described this as a use case where the digital ruble could be especially effective. While that approach relies on a central bank digital currency rather than an open public blockchain, both models reflect the same broader policy objective: making government payments more traceable and easier to audit.
For now, Belshe’s proposal remains a policy suggestion rather than an announced government initiative. Still, it highlights how crypto infrastructure is increasingly entering debates over public accountability, fraud prevention, and the future architecture of state payments.