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MasterCard mulls using blockchain tech

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Note4students

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


News

Context

  • 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

Regulation

  1. In India, an inter-ministerial committee is currently looking at how best to regulate blockchain technology, if it is allowed at all.
  2. One of the proposals is to bring it under market regulator Securities and Exchange Board of India (SEBI).
  3. Another option that could be considered is bringing blockchain regulation under the proposed Payments Regulatory Board in the Reserve Bank of India.

Back2basics

Blockchain Technology 

  1. Blockchain is the technology behind crypto-currency such as Bitcoin, which is a purely electronic currency that can also be traded on exchanges.
  2. It is a continuously growing list of records, called blocks, which are linked and secured using cryptography.
  3.  Each block contains typically a hash pointer as a link to a previous block,a timestamp and transaction data.
  4.  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.
  5.  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.

 What is Blockchain Technology?

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