Opinion

Blockchain tech is the future

Updated on: Dec 20, 2021

India has the potential to emerge a leader in this space

From being a Bitcoin platform, as conceived by Satoshi Nakamoto in 2009, blockchain has come a long way to emerge as an encompassing innovative backbone technology to add value to businesses across sectors, much beyond the originally planned cryptocurrency realm.

It is good to see the technology coming of age in India too, with the government making a move to set up a national blockchain framework to prepare a centralised ecosystem that will cover as many as 44 sectors including e-governance.

Moreover, the move to leverage the potential of this emerging technology through a policy framework will bring India on a par with countries like China, the UAE, the US, Brazil, Chile, Canada, Singapore and Switzerland which have already made big leaps in the blockchain space.

This technology is going to be the game-changer in the days to come. According to a Gartner report, many new innovative companies will use it and at least one business created using this advanced technology would be worth $10 billion by 2022. By 2030, it could be used as a foundational technology for 30 per cent of the global customer base.

By 2025, blockchain would add a business value that will grow to over $176 billion. This would increase further to $3.1 trillion by 2030. It simply shows the unfolding potential.

One of the finest points of the proposed framework is that the Ministry of Electronics and Information Technology (MeitY) has identified 44 key areas, almost every sector from pharma and farming to education and energy.

Among all these, e-governance will get the spur as the government has listed a long list of potential applications for fool-proof delivery of services to the citizens.

Digital certificate management, transfer of land records, pharma supply chain, e-notary services, e-sign solution, duty payments, automated customs enforcement and compliance, agriculture supply chains, e-voting, crypto wallet, health records, cross-border transports, public service delivery, charity donations, smart grid management, and vehicle registrations are just a few of them. As the data in the blockchain technology is near impossible to be tampered with, the trust and accountability of e-governance will be maintained.

More importantly, it can integrate the existing applications like e-Sign, ePramaan, and DigiLocker, apart from the current infrastructure and services.

It means that the isolated attempts by different departments to adopt this technology will now be integrated and we will see a much-needed momentum for IT reforms, with the support of the private sector and enhanced research.

The goals have been laid out clearly and the potential is captured well in the proposed policy initiative. The technology will store data in a decentralised, vigilant, time-stamped, immutable manner, providing an efficient ledger storage mechanism in a distributed environment.

The challenges

But we cannot ignore the many challenges. The biggest concern is the scalability as the current transaction processing rate varies, depending on many factors. The performance and scalability of blockchain networks will be the key focus area now. As with other similar innovations, security will remain another major challenge, though constant efforts would be made to develop new models and products for enhanced security.

Another sore point is the interoperability, which still is in its nascent stage in the country and a lot needs to be done in many key areas. Data localisation is an area that needs focus and research. In order to restrict the data flow and localise data, countries have introduced new laws.

The European Union introduced a data protection law called the GDPR (General Data Protection Regulation).

But, overall, the new initiative is a welcome move from an international perspective as many countries have marched ahead of us. China has a Blockchain-based Service Network for faster deployment of applications while the European Blockchain Partnership is building a trusted European Blockchain Services Infrastructure for interoperability, privacy, and security.

India has the potential to emerge a leader in the blockchain technology just like it has demonstrated its capabilities in other IT innovations.

The writer is Chief Business Officer, Blockedge Technologies

Published on December 20, 2021
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