Blockchain Soon To Disrupt In India
- India is placed sixth on the list of patents and trends in the Blockchain industry.
- Blockchain, in India, has made its presence known in profound ways and is robustly making its way into the Indian fin-tech ecosystem.
- Countries like Japan and Korea are regulating crypto, whereas other countries like India and China have banned them.
Blockchain is a simple concept, yet it is complex and broadly diverse in its use-cases at the same time. Many countries have recently started to realize the radical potential which Blockchain has to offer and are keenly eyeing the unexplored areas of this disruptive technology, even though it is still in a budding stage. It has the capability of bringing about an immense transformation in the day to day lives of many.
It is widely believed that “Blockchain is good while cryptos are bad”, which is why countries are adopting Blockchain but banning cryptocurrencies.
The cryptocurrency transactions are encrypted, that is –only the involved parties can track these transactions, hence regulators are unable to keep track of the transactions. Even though cryptocurrencies allow smooth cross-border transactions, their vulnerability of falling prey to illegal activities increases by a lot, moreover –they are a seedbed for tax evasion.
To apply Blockchain technology for government purposes, a few countries like Japan and Korea are regulating cryptocurrencies, whereas countries like India and China have banned the same altogether. Because cryptocurrencies are operated by Blockchain, many happen to wrongly believe that Blockchain is all about cryptocurrencies.
The manifestation of Vitalik Buterin, a Russian-Canadian programmer and writer primarily known as a co-founder of Ethereum and as a co-founder of Bitcoin Magazine, led to the beginning of Ethereum Blockchain that supports many applications and is more functional than Bitcoin Blockchain. The governments of countries worldwide get interested in this functionality and the innovations and technological advancements it offers, which is why they are in favor of adopting Blockchain.
Similarly, India too has decided to put its hands on the technology and is planning to adopt it in numerous sectors.
BLOCKCHAIN IN INDIA
The adoption of Blockchain technology in India is growing rapidly and the investment in such projects have reached more than $20 billion across different industries, per the Blockchain Report 2019 by NASSCOM. Moreover, the report further adds that many Indian state governments like those of Telangana, Kerala, Karnataka, Andhra Pradesh, and Maharashtra are regulating Blockchain startups and organizing conferences and hackathons on the topic.
According to the data from the World Intellectual Property Organization, India purportedly stands 6th on the list of patents and trends in the Blockchain industry, with a cumulative of 67 patent approvals in 2018. Ever since demonetization impacted the Indian citizens in 2018, a wave of digital transactions has swept in, where there has been a huge shift from transacting with physical currencies to paying digitally through mobile wallets like Paytm, GooglePay, PhonePe, Amazon Pay, and many such platforms.
Due to its advantages like providing seamless and quick transactions and its cashless approach, Indians are gradually starting to prefer paying through digital platforms. Therefore, with this largescale successful adoption of digital payments, India is now deciding to join the race and adopting Blockchain. It is now proving to be one of the advanced innovations that will bring in a huge transformation and define the future of digital transactions in the country.
BLOCKCHAIN TRANSFORMATION IN INDIA
Among the vast number of industries adopting Blockchain in India, Blockchain has made its way into the Indian fin-tech ecosystem where Banking and Finance dominates the list followed by industries like healthcare, retail, logistics, etc. Blockchain in India has made its presence known in profound ways and found its way into the Indian fin-tech ecosystem.
- The banks in India were quick to realize the advantages of Blockchain for carrying out banking operations efficiently and are using the KYC procedures offered by the technology. SBI was the first bank to use KYC and to facilitate Blockchain based money transaction, followed by Axis, HDFC and ICICI. Adding to this, the DLT also allows AML, the validation of land records and asset inventory audits.
- Inherent inefficiencies in the claim management system of the Insurance Industry in India led to a loss of approximately Rs. 10,000 crore per year. The only ultimate solution to overcome these issues is to implement Blockchain. Cognizant has collaborated with Insurance providers like ICICI Prudential Life Insurance, SBI Life Insurance, HDFC Life, Kotak Life, etc to come up with a secure data-sharing solution built on Corda Blockchain platform.
- Tata Consultancy Services (TCS),along an integrated approach with Microsoft and R3, an enterprise Blockchain software firm, to support the adoption of Blockchain in industries. Track and trace, digital identity, asset monetization, assets in common, and tokenization are the further five Blockchain platforms being built by them.
- IndiaChain, a project which has been built by the public, will perform the functions of public administration using Blockchain for efficient and seamless distribution of government subsidies, streamlines record-keeping, systematic tax monitoring, and regulated supply chain management. The project also plans to enter the education sector to eliminate fraudulent degrees and certificates, and transparently manage huge amounts of data in the healthcare industry.
- The Real Estate Industry in India faces a lot of difficulties in maintaining, searching and verifying title deeds making ownership more prone to fraud, time-consuming process in transferring property and over-reliance on the registration officers, banks, brokers, etc. Blockchain helps overcome these problems by digitizing land titles, due to which each land property would have a digital address stored on the Blockchain along with its specifications. Furthermore, the decentralized property of this technology prevents the dependency and allows instant transfer of property.
POSSIBLE POTHOLES IN THE ADOPTION OF BLOCKCHAIN
A journey without potholes is not worth remembering. Everything has its own bumpy journey and although Blockchain technology is very efficient and assuring with massive potential and scope for its adoption and application, it still faces a few challenges or potholes in India.
- The Indian government is yet to implement clearly defined implementations and regulations on Blockchain technology. The adoption and application will rapidly accelerate as soon as the regulations by the government are well-defined.
- RBI and tax authorities do not favour the regulation of crypto and ICOs in India because of the issues related to tax evasion and the lack of control over digital currencies. due to the battle between Indian authorities and cryptocurrencies, Blockchain based startups and projects are uncertain about going forward.
- Many supply chain venders are sceptical about the technology because of the lack of awareness and trust issues in technology. Hence, more digitization and awareness would be necessary to accelerate the application of Blockchain.
- The application and testing of Blockchain applications are still limited particularly to cryptocurrencies in the current scenario. A successful execution of PoC i.e. Proof of Concept requires the hiring of Blockchain experts or data scientists which is comparatively more expensive than hiring software developers.
In conclusion, people do not like change, therefore a transformational adoption is resisted by everyone. But even though Blockchain is still at its nascent stage, India is pacing towards adopting it. This will positively enhance and prove to be a game changer across all spheres of business. An integrated effort from the government and industries will help the policymakers that will design the future of Blockchain technology in India.
Although blockchain is in its infancy, India is pacing towards its adoption and inclusion. Implementing this technology across all business industries will certainly prove to be a game-changer despite the roadblocks in its adoption. Combined efforts of the government and diverse industries will aid the policymakers in designing and implementing policies that will shape the future of the disruptive technology in India.