One of government's key functions is to build and maintain the legal and regulatory framework to support economic growth. The rise of various technologies, blockchain in this case, should be considered for government adoption and use in the context of that function. 

This is a good, brief article about how some U.S. state governments, and Rhode Island in particular, are starting to view blockchain not as some exotic technology somewhere down the future, but as a tool to make easier and more standard personal and organizational identification and payment. 

Basically, the technology is making routine transactions between companies and governments, as well as companies and consumers, much easier and improving accountability in the process for regulatory purposes. It looks like it's going to be very helpful in making government much better at one of its core functions. It should be explored by local governments as well. Check out this advice from one of the U.S. leaders on this topic.