Bitcoin might be temporarily losing its sheen but the technology that catapulted the cryptocurrency into the limelight is continuing to generate huge interest. Known as the blockchain, this technology is the backbone to which Bitcoin owes its success and popularity completely. It is estimated that the global market size for blockchain would reach $7 billion by 2022 growing at a staggering compound annual growth rate (CAGR) of 79.6% from 2017. While cryptocurrencies were its earliest use cases, the scope of blockchain has been identified across many sectors such as banking, telecom, supply chain, digital voting and many others. Though most of the blockchain related technological development is in the West, developing economies like India, China and others are believed to have the greatest impact from the blockchain technology. According to David Crosbie, a lecturer at the University of Pennsylvania, blockchain’s impact will be the most significant in the developing world. According to him, developing economies face issues of poor and inefficient governance, red-tapism, lack of transparency and primarily rely on a paper-based record keeping system. Blockchain being a distributed public ledger therefore fundamentally eliminates all such issues and gives way for a complete digital transformation.
For India, currently, the sixth largest economy, blockchain technology offers numerous opportunities across many sectors. According to a news report, Indeed, a job website saw a stunning 290% rise in the number of blockchain or cryptography related jobs proving the huge interested the field has generated since Bitcoin came into popularity. Besides, it is estimated that of the 15 million cryptocurrency wallet users worldwide, 1.5 million users are based in India. For one of the most populous countries, the number is too insignificant (0.1% of the total population). Regardless, banking institutions in India have already started to experiment with blockchain. For instance, in 2016, ICICI bank conducted a pilot transaction using blockchain network and it is reported that State Bank of India (SBI) is planning to implement a full-fledged blockchain solution in its remittances, trade finance operations and reconciliation in 2019.
In a country like India, there are very many underlying problems that Blockchain technology has the potential to eliminate. However, to motivate widespread adoption of the blockchain, there needs to be a massive awareness about this technology. Currently, there is a severe lack of talent to build this technology to address real-world problems. For India to take advantage of such an opportunity, talent needs to be developed at the grassroots level of colleges, universities and technical institutes.
Selvam VMS (Co-founder and CEO of DiscoveryIoT)
“While there are millions of students graduating with a tech degree each year in India, it has been reported that 90% of these graduates lack employable skills, by partnering with academic institutions and industry leaders, Discovery Labs is an initiative targeted to improve this state by getting students involved in on demand technologies like Blockchain and AI, and help them be a seed for the evolving technological landscape in India” says Selvam VMS, founder of Discovery Labs. Such initiatives are imperative to accelerate blockchain adoption and in addition, it helps to build and foster a vibrant tech entrepreneurial culture.
According to a report by 6Wresearch, the market for blockchain technology in India is expected to grow at CAGR 58% during 2018-24. This rate of growth is primarily attributed to the increase in digital payment solutions and following is a glimpse at the few use cases in India where blockchain has a great potential to be implemented in the near future:
As with the rapid adoption of digital payments, blockchain has the potential to transform the finance sector like never before. A majority of the trade in India occurs in the informal retail sector, therefore, for India to become a cashless economy, there needs to be a compelling reason for small-scale merchants to adopt digital services when there is a high set up cost for card swiping terminal and cost associated with every transaction. With blockchain, instant and feeless transactions can be carried out by removing the third parties involved. In the banking sector, banks can explore various cases with blockchain such as KYC, asset registries and etc. Serving as an example, state-owned bank SBI is looking to aggressively deploy blockchain solution in their services and in future, the rest could follow suit.
With top telcos such as Bharti Airtel, Vodafone India and Reliance Jio planning to deploy blockchain into their platforms, telecom sector in India is set for a complete transformation. At a time when there is fierce competition in this sector, telcos are looking for ways to streamline their existing services and lower the operational costs. Blockchain has convincing use cases in number portability, smart transactions, data and content monetization. By maintaining an inter-company ledger, numbers can be ported swiftly for customers and in addition, databases can be managed effectively.
Recently, India’s telecom regulator TRAI (Telecom Regulatory Authority of India) also intended to utilize blockchain technology to curb pesky & irritating telemarketing spam calls.
Blockchain technology is the most promising solution to ensure free, fair and transparent elections and voting processes. By its nature, blockchain cannot be tampered with and it can keep the records secured over a ledger with a time stamp. Hence, allowing anyone to verify the records at any time.
Last year, it was reported that Election Commission of India is contemplating the use of blockchain technology in voting machines.
While blockchain technology is still in its nascent state, it is important to realize the potential it holds in shaping the digital future of a country. With ambitious projects for digital transformation, it is imperative that India leverage the resources it has to orient itself to be the front-runner in technology advancement. Blockchain lends itself to be a solution to some of the biggest challenges faced in India and it is time that we embrace it.
[Top Image – Blokt.com]
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