Blockchains are also vulnerable to network attacks as they were not originally designed for network protocols, and there are challenges of insertion of malware files and objectionable content as Blockchain services continue to grow.
India is abuzz with reports on the potential uses of Blockchain technology. There is growing support from the central and state governments for it. Andhra Pradesh and Telengana are planning to use the technology for land registry records, education certificates and vehicle records, and the NITI Aayog has tied up with Oracle, Apollo Hospitals and Strides Pharma Sciences for a pilot on supply chain management of drugs. The Indian government, however, has declared a specific spin-off of the technology — crypto currencies — illegal. This is because for a corruption-riven country such as India, crypto currencies may lead to black marketeering and tax evasion, no matter how much digitised the transactions are.
There are more reasons to be cautious.
The cost of transactions via Blockchain are high; currently it is $20 per transaction. The pace of the transactions (seven transactions per second) and the response time to each transaction (10 minutes) is slow. So scaling up the system can slow down the process.
The power requirements are huge. Also, as the size of Blockchain increases and more transactions are cached, the performance will decrease, and transactions will become increasingly difficult to manage due to storage, bandwidth, and processing power requirements.
Absence of standards or inter-operability between various Blockchain platforms could be another drawback.
Blockchains are also vulnerable to network attacks as they were not originally designed for network protocols. There are challenges of insertion of malware files and objectionable content as Blockchain services continue to grow. This raises issues of privacy violation, potentially illegal files, copyright violations, malware, insertion of politically sensitive content, and insertion of illegal and condemned content.
One of the crucial attractions of the technology is its immutablity — that is, once some data has been entered, it cannot be altered or deleted. The connecting nodes between different blocks of data in a chain maintain full copies of all data entered; and deletion of content is impossible. But the inability to alter data can be a double-edged sword when someone intentionally inserts false data or any objectionable or illegal content.
Deletion of such unwanted content is impossible, which means the Blockchain operators can be sued for hosting illegal or objectionable or politically sensitive content, or violation of privacy and copyright. In Germany, Blockchains hosting illegal content can be charged under a specific clause in the country’s criminal laws. It is not clear whether Indian laws have addressed potential loopholes in emerging Blockchain technologies.
India needs to examine all aspects of the technology before it joins the bandwagon. American Internet pioneerVincent Cerf correctly cautions: “Blockchain technology is supposed to be the aspirin of the computing world. Please do not believe it. It is not true.”
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