Source: CryptoCarbon website
CryptoCarbon, along with Fintech Storm, is hosting the first ever Blockchain India Summit on December 6th, 2016 at Shangri La Hotel, New Delhi.
The event will feature a posse of global Blockchain leaders, including Vitalik Buterin, founder of Ethereum, who will be the guest of honour at the summit, along with pre-eminent leaders in Distributed Ledger Technology (DLT), such as Ethereum, Consensys, Microsoft, Wipro and IBM.
About Blockchain
Blockchain, or DLT, is the technology behind bitcoin, the digital currency which has enjoyed a phenomenal rise in value since its introduction in 2008, just after the worldwide financial crisis took place.
Blockchain, however, rose to prominence after Vitalik Buterin founded Ethereum in 2014, to extend the benefits of bitcoin beyond currency, and as an underlying code to create self-executing business contracts - Smart Contracts. These would potentially disintermediate many industries, driving cost savings, and enhancing the efficiency of processes.
DLT Projects
DLT has seen more than $1.4 billion invested in the last 3 years, and some 2,500 patent filings. It is predicted that 80% of banks will have initiated DLT projects by 2017, with most DLT investments having been made by marquee banks such as Goldman Sachs, Barclays, J.P. Morgan, UBS, Credit Suisse, and financial services industry leaders such as Visa, Mastercard, and NASDAQ.
A World Economic Forum (WEF) Report, dated August 2016, has stated that the financial services infrastructure will be reshaped by DLT, coupled with many converging technologies including robotics, machine learning, biometrics, and cognitive, quantum and cloud computing.
There are a number of use cases identified by the WEF, including Global Payments, Investment Management, Commercial Property, Insurance and Claims Processing, Syndicated Loans, Trade Finance, Compliance, Proxy Voting, Asset Re-hypothecation and Equity Post Trade.
India Represents a Huge Market
India is one of the top remittance-receiving countries in the world, claiming more than 12% of the world's remittances in 2015, with its high income-earning diaspora spread across the developed world. The 270 million unbanked adults in developing economies who send or receive domestic remittances using only cash, represent a huge market opportunity for DLT.
The most critical DLT applications require industry collaboration. Dubai recently launched its Global Blockchain Initiative (GBI), with 30 members from both public and private sectors, and now has a total of 47 members.
Replacing existing financial infrastructure is a big undertaking, delaying DLT implementations in highly-regulated markets. Ms Arifa Khan, Conference Chair for Blockchain India Summit, has been engaged in discussions in India with RBI, and the CEO of the National Payments Corporation of India (NPCI), as well as other banking sector players, about collaborative efforts to explore Blockchain applications on common platforms.
Ms Khan hosted a seminar on DLT for RBI's Working Group on Fintech in May 2016 in Mumbai, and contributed to the regulator's early endeavours to understand the scope and challenges of bitcoin & blockchain. RBI CAFRAL further hosted a DLT seminar by Ms Khan in Mumbai in July 2016, drawing attendees from over 25 banks & FI's.
The Effect of Cryptocurrencies
Cryptocurrencies have repercussions on the economy as well as on many of the functions of RBI - some areas of regulatory interest being currency stability and volatility, effect on supply side economics through monetary supply, potential tool for inflation control, taxation etc.
The long-held view that central banks have no competitors for issuing currency has been challenged by bitcoin. Vitalik Buterin's "ether" is the second most prominent cryptocurrency valued close to $1bn, after bitcoin which is valued at $20bn. Several new cryptocurrencies are now being launched, with the likes of Zcash being a particularly prominent one. Many decentralised applications based on Blockchain are creating their own crypto tokens for use in circular economies, similar to QQ Coins, or tokens that are used in virtual games. Japan is dropping the 8% sales tax on bitcoin as an acceptance of its growing popularity.
Bitcoin referred to as 'fascinating'
Former RBI Governor Dr Raghuram Rajan had publicly stated that bitcoin is "fascinating", and that RBI could release its own digital currency, but that such an issuance could take years to undertake if attempted, perhaps as long as 10-20 years.
"Over time, virtual currencies will certainly get much better, much safer and will be the form of transaction. That's for sure.", Dr Rajan has stated. Central banks of countries around the world are urging other banks to adopt blockchain. Deputy Governor Rama Gandhi had urged banks to work to develop applications for digital currencies and distributed ledgers, when speaking at an event at IDRBT on 19th July 2016.
Interestingly, India's first Blockchain Summit comes at a time when Indians are reeling under catastrophic effects of a surprise currency-ban imposed by the government, just the type of ills of centralised authority & monetary control that bitcoin is immune from. The sudden ban of Rs500 & Rs1000 notes brought the predominantly cash economy in India to a screeching halt, and reduced citizens to Pokeman-go like players desperately trying to find some valid currency notes anywhere, seeing them queueing up at dawn and waiting for hours in miles long queues!
While the bitcoin world is never short of drama, India, with its constant crises, presents something of a 'low-octane war zone', with even debit card usage in India being less than 20%. Since no one was prepared for this emergency, including ironically neither the government nor the banks that introduced the ban, most industries and services were significantly disrupted, greatly aggravating the population at large.
With India being neither a hyper-inflation country like Argentina, nor a lawless land where demonetisation was a necessity, this was a calamity that even the likes of insurance firms could not foresee. The prominent economists - Dr Raghuram Rajan and Dr Man Mohan Singh (the former Prime Minister), had both been against demonetisation. Yet, this deliberate experiment was created ostensibly to control 'black money', but failed on more counts than expected.
Citizens took to buying gold, real estate, dollars, and whatever they could lay their hands on to get rid of the soon-to-be-worthless notes, driving prices artificially high. Black money hoarders found means to preserve their hidden wealth, moving from cash to other assets, albeit at inflated prices. Bitcoin/cryptocurrencies would have been the only alternative, perhaps safer in such an improbable exigency (a blackswan event).
This is a problem that bitcoin would have certainly solved, had bitcoin been legal currency in India - however, we can be certain that the Indian Government was not thinking of becoming inadvertent marketers of bitcoin, when they conceived this particular experiment!
Still a far cry from being a cashless economy, despite the success of PAYTM, India is home to 21% of the world's unbanked population of 2 billion, which is fully cash reliant. Bitcoin and blockchain would both present numerous interesting propositions including financial inclusion (of great interest to the Gates Foundation in india), and to a wide range of stakeholders such as RBI, NPCI and industries such as Banking & Financial Services, Healthcare, Education, and Government - which is what the Blockchain India Summit and its international participants aim to explore on 6th Dec 2016.
Though India is lagging behind the west in Blockchain awareness, ICICI is a promising start, having announced successful partnership experiments with the Emirates. Arifa Khan's ambitious venture Zero Field Labs, aims to change India's Blockchain readiness and will have gathered the who is who of the next global trillion dollar industry for the first time in India during the upcoming summit. Among the invitees are bitcoin legends such as Roger Ver and Chandler Guo, the chinese bitcoin mining giant. "With over 300m people connected to internet, India is the fastest growing IT market in the world. The Blockchain India Summit will serve as an effective way to introduce Ethereum throughout the region, and ConsenSys is honoured to participate and will be showcasing the future of Blockchain technology at the summit", stated Andrew Keys, Head of Global Business Development at ConsenSys.
At the Indian Institute of Technology in Madras, Ms Arifa Khan's alma mater, will be hosting Vitalik Butyrin's special lecture on the future of crypto-economies and cryptography on 9th Dec in Chennai. Ms Khan is pleased to be hosting Vitalik's first visit to India - she is excited to work with banking and other industries in their transition to a Blockchain enabled world!
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