Why in the News?

Recently, Union Ministry of Electronics and Information Technology (MeitY) has launched the ‘Vishvasya: National Blockchain Technology Stack’.

More on the News

Additionally, MeitY has also launched:

• NBFLite: A Blockchain sandbox platform, developed especially for startups/academia for rapid prototyping of applications, carrying out research and capacity building.
• Praamaanik:  A solution that harnesses Blockchain technology to verify mobile app origins and is powered by the National Blockchain Framework.
• National Blockchain Portal: It is developed on the theme based on Content Management System to manage the contents related to the National Blockchain Framework initiative.

About Vishvasya: National Blockchain Technology Stack

• It offers Blockchain-as-a-Service (BaaS) with a geographically distributed infrastructure designed to support various permissioned Blockchain based applications.
  • BaaS is third party cloud-based infrastructure and management that organizations and businesses use for developing and managing blockchain applications.
• It is a part of the broader National Blockchain Framework (NBF) provided under the National Strategy on Blockchain.
  • NBF is meant for effectively utilize the Blockchain technology in different domains such as health, agriculture, education, finance, etc.

• Significance of BaaS
  • Facilitates in enabling trust by developing new types of distributed software architectures, capable of finding consensus on their shared states and providing a single source of truth.
  • Addresses the challenges of Blockchain adoption across various stakeholders including Infrastructure Providers, Smart Contract Developers and Application Developers.
  • Provides security assurance of various Blockchain components across the stack.

What is Blockchain technology? Blockchain  is an innovative distributed ledger technology, first introduced in the design and development of cryptocurrency, Bitcoin, in 2009, by Satoshi Nakamoto. It is an amalgamation of various technologies such as distributed systems, cryptography, etc. It is an exchange process, which works on data blocks. In this, one block is connected to another block.  Working Mechanism Data and transactions executed over the network are stored in the ledger in a decentralized manner over peer-to-peer network.  Transactions  are validated and verified through consensus protocols across nodes of the Blockchain network.  Properties of Block Chain Smart Contracts: Auto execution of digital contracts. Distributed:  All Trusted participants have a copy of the ledger for complete transparency. Immutable:  Any validated records are irreversible and cannot be changed. Time-stamped: A transaction timestamp is recorded on a block. Consensus: All network participants agree to the validity of each of the records. Trusted Data: It is decentralized and managed by multiple participants. Secured: All records are individually encrypted Types of Blockchain Public Blockchain: Operates in a decentralised open environment where there are no restrictions on the number of people joining the network (as peers or validators). e.g., Bitcoin and Ethereum. Consortium Blockchain: Operates in an environment where the rights to control who participates and what can be transcribed to the ledger is determined by a collection of known entities. Private Blockchain: It is a network with a single controlling entity, who has the power to determine who the participating entities in the network would be and their rights to append information to the ledger.

Potential applications of Blockchain Technology

• Cryptocurrencies: Cryptocurrencies (e.g., Bitcoin, Ethereum, Litecoin, Ripple, etc.) uses blockchain to record and verify transactions, which makes them secure and transparent.
• Supply Chain Management: It enables more efficient communication and collaboration between suppliers, manufacturers, distributors, and customers.
• Voting Systems: It can include features such as voter identification, eligibility checks, and ballot tracking, all of which can Identity Verification.
• Intellectual Property Protection: For e.g., companies can use blockchain technology to manage their trademarks and patents, ensuring that their intellectual property is protected and not used without their permission.
• Records Management: For e.g., Blockchain-based healthcare record management can also help improve data accuracy and integrity by providing a single source of truth for patient data.
• Others: Law Enforcement, banking, Internet of Things, crowd funding, etc.

Challenges in Blockchain Technology implementation

• Performance: Replication of data on each node leads to performance issues and slows down the performance as compared to traditional centralized systems. 
• Scalability: Poor scalability due to factors such as complex architecture and configuration of the Blockchain platform, variable requirements for processing power, network bandwidth, etc.
• Storage: Demands heavy storage as data stored is replicated at all the nodes and becomes perpetual.
• Energy Consumption: Blockchain networks often require significant computational power, leading to high energy consumption.
• Interoperability: Interoperability between different blockchain platforms can be a challenge, especially in environments where multiple networks coexist.
• Legal: Section 43A of the Information Technology Act, 2000 currently does not have safeguards mentioned from the perspective of Privacy when applied to Blockchain.
  • Localization requirements: Since public Blockchain automatically store data redundancies across all nodes on a network, it may hit a hurdle with localization requirements.

Other Initiatives taken to promote Blockchain Technology 

India

• National Strategy on Blockchain by MeitY.
• Centre of Excellence in Blockchain Technology
• Future Skills PRIME: For upskilling and reskilling in emerging technologies including Blockchain by NASSCOM and MeitY

Global

• World Economic Forum's Presidio Principles: A Blockchain Bill of Rights issued by World Economic Forum’s Global Blockchain Council.
• IBM's Blockchain World Wire: A global payment network using blockchain to facilitate cross-border transactions.
• Global Blockchain Business Council (GBBC): An industry association promoting blockchain technology adoption across various sectors.

Conclusion

India's path to blockchain adoption requires a balanced approach that combines skill development, regulatory clarity to provide enabling, practical implementation through identification of specific use-cases, and robust security measures. By addressing these key areas simultaneously, India can create an environment conducive to blockchain innovation and adoption, positioning itself as a global leader in this transformative technology.