THE ROLE OF BLOCKCHAIN TECHNOLOGY IN ENSURING GOVERNANCE TRANSPARENCY AND EFFICIENCY IN THE DIGITAL ECONOMY

Abstract

In the current era, global financial and governance architectures are rapidly transitioning to digital systems. Despite this trend, many economic operations continue to rely on centralized, multi-layered, and intermediary-based models characteristic of the previous century. These traditional systems are increasingly misaligned with the demands for speed, transparency, and efficiency in the digital economy, leading to operational inefficiencies, increased transaction costs, and heightened risk of fraud. Blockchain technology, with its distributed ledger, algorithmic trust mechanisms, and real-time verification capabilities, offers a potential solution to these systemic challenges. This study employs an institutional approach to assess the role of blockchain in enhancing governance transparency, operational efficiency, and trust in both public and private sectors. A systematic literature review (SLR) of over 500 sources from 2015–2025, combined with comparative and interpretative analyses, demonstrates that blockchain can significantly reduce transaction costs, streamline auditing, and mitigate human error and corruption. However, the successful implementation of blockchain is contingent upon legal frameworks, institutional readiness, and digital infrastructure. The study also highlights the evolutionary shift from interpersonal and institutional trust to algorithmic trust, illustrating blockchain’s capacity to reshape socio-economic interactions. The findings provide practical recommendations for emerging economies, including Uzbekistan, to harness blockchain as a strategic tool for economic modernization and governance reform.