Mains Paper 3: Science & Technology | Awareness in the fields of IT, Space, Computers, robotics, nano-technology, bio-technology and issues relating to intellectual property rights.
From UPSC perspective, the following things are important:
Prelims level: blockchain technology, crypto-currency- Bitcoin
Mains level: Applications of blockchain technology and issues involved in its use in banking sector
- Mastercard is looking to incorporate blockchain technology into its operations and would like a clear regulatory framework in India that lays down what blockchain can be used for
- In India, an inter-ministerial committee is currently looking at how best to regulate blockchain technology, if it is allowed at all.
- One of the proposals is to bring it under market regulator Securities and Exchange Board of India (SEBI).
- Another option that could be considered is bringing blockchain regulation under the proposed Payments Regulatory Board in the Reserve Bank of India.
- Blockchain is the technology behind crypto-currency such as Bitcoin, which is a purely electronic currency that can also be traded on exchanges.
- It is a continuously growing list of records, called blocks, which are linked and secured using cryptography.
- Each block contains typically a hash pointer as a link to a previous block,a timestamp and transaction data.
- By design, blockchains are inherently resistant to modification of the data. Functionally, a blockchain can serve as “an open, distributed ledger that can record transactions between two parties efficiently and in a verifiable and permanent way.
- For use as a distributed ledger a blockchain is typically managed by a peer-to-peer network collectively adhering to a protocol for validating new blocks. Once recorded, the data in any given block cannot be altered retroactively without the alteration of all subsequent blocks and a collusion of the network majority.