Why is the government dilly-dallying on Web3?

The police department in Firozabad, Uttar Pradesh has launched a blockchain-based portal for public complaints. The website – called “police complaint on blockchain” – will allow the public to file complaints or grievances online. Complainants will also be able to regularly check the status of the case and receive notifications about the progress of the complaints.

The most important part of it is that since it is based on blockchain technology, the information uploaded on the website is immutable. Once the complaint is filed, it is permanent and cannot be removed or changed.

This development shows how serious the authorities are about using blockchain technology and expanding its areas of use in various areas.

Chains of blockchain

The Ministry of Electronics and Information Technology (MeitY) has established a center for exchange within blockchain technology (CoE).

There are four products developed by the department that are in use: Certificate chain, Document chain, Property chainand Logistics chain.

The main goals of Certificate chain shall prevent forged documents, cumbersome document verification and delays in service delivery. The Central Board of Secondary Education (CBSE), one of the first organizations to adopt this technology, maintains its academic data on the blockchain.

Document chain provides organizations with a uniform method for storing and retrieving any government document, such as caste certificate, driver’s license, ration card and other certificates. The revenue department in Karnataka, for example, uses this technology to issue caste and income certificates.

Likewise, a blockchain-powered one Property chain the system allows the availability of a common property ledger – enabling a single source of truth.

The Logistics chain is an online supply chain management system for a specific industry.

Along with these technologies, the government is also expanding the implementation of blockchain in the payment system.

From public service to payment

In 2020, National Payments Corporation of India (NPCI) announced the launch of “Vajra Platform” to make payments quickly and securely. The platform was based on blockchain technology, which was supposed to automate the clearing and settlement of payments – drastically reducing the need for manual reconciliation.

According to NPCI, the Vajra platform is based on a permission model that ensures that only approved parties can join the network. Once approved, they can deploy the platform using an API provided by NPCI.

Moreover, the government is also planning to launch its own centralized bank digital currency (CBDC).

According to experts, CBDCs will be recognized by law and backed by the central bank, which cannot go bankrupt. It uses the same blockchain technology that supports cryptocurrencies; it is as secure as cash and it is also convenient as a payment app.

CBDCs will be distributed through commercial banks, preventing central banks from dealing directly with millions of consumers and businesses.

While the government is using the blockchain technology for various purposes, it has opposed the idea of ​​blockchain-based cryptocurrencies.

The government is cracking the whip on Crypto

The Indian government has been very strict on cryptocurrencies since trading in virtual currencies gained ground in the country. The Reserve Bank of India (RBI) has warned users, holders and traders of virtual currencies (VC) that trading in such currencies involves potential economic, financial, operational, legal, customer protection and other security-related risks.

Over the past few years, the Indian government has further tightened its stance on Crypto and is planning to introduce a bill that will determine the legal contours of Crypto in India.

According to the latest reports, the government plans to take a final call on the fate of cryptocurrency after RBI’s Financial Stability Board (FSB) comes in October 2022. Furthermore, it was claimed that the report will help the government create a legal framework around it. .

Meanwhile, in July this year, Finance Minister Nirmala Sitharaman made a statement in Parliament saying that “global cooperation” would be needed to effectively initiate a ban on cryptocurrencies and digital assets. This statement has sent positive signals to several stakeholders in the industry.

Moreover, the recent announcement of CBDC (Central Bank Digital Currency) also suggests the government’s acceptance of the popularity of cryptocurrency and how it is preparing to compete against it.