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Desire for Life for the MIA “Russia Today”
In Russia, under the auspices of the Central Bank, the Russian blockchain-consortium is being formed. Let’s see what it is – blockchain, and why it is needed.
What is blockchain
Blockchain is a technology of distributed registers that provides storage and processing of data in a chain of blocks. Transaction records are not centralized and are verified by the network participants themselves, exchange of money and other resources is carried out without intermediaries. According to blockchain technology, crypto-currencies work, including the most famous of them – bitcoin. According to Goldman Sachs data, blockchain technology can bring substantial capital savings to the capital markets: annually about $ 2 billion in the USA and $ 6 billion on a global scale.
Reducing costs due to automation and eliminating repetitive tasks is not the only advantage of blockchain. The explosive growth of interest in new technology is also promoted by its safety, reliability and transparency.
Confidential relations with partners and unconditional reliability of the information received (it is necessary to recognize, a great rarity in our times) are important not only for businessmen, investors and state structures, but also for ordinary users.
In this sense, blockchain is more than just technology. This is a breakthrough, comparable with the advent of the Internet; the new philosophy capable to turn literally all spheres of our life. And this is not exaggeration.
Russia is figuring out
In conditions when the block becomes a world trend, Russia, of course, can not ignore it. Despite the fact that some analysts consider the technology of distributed registries as the tool for overthrowing the dictatorship of banks, it is banks and payment systems that show the most keen interest to blockchain.
So we have: the first to respond to the initiative of the Central Bank responded to major players in the financial sector – the QIWI group, the Assenture company, Binbank, MDM Bank, Bank “Otkritie” and Tinkoff Bank.
In its time, the subdivision for investigation of detachment was created in Sberbank, whose head is known to be a supporter of the introduction of a new economic tool. However, neither Sberbank nor another financial “heavyweight” – VTB – has officially announced yet a decision to become members of the Russian consortium.
But it is known about Sberbank’s intention to join the international consortium R3 so that, developing services based on blockchain technology, strengthen its transactions protection and reduce dependence on the SWIFT system, thereby minimizing the risks from application of sanctions.
At the same time, it is emphasized that Sberbank does not have plans to issue its own cryptocurrency and intends to use blockchain only as an alternative, more convenient and reliable way of internal mutual settlements, carrying out transactions between its subsidiaries and other banks.
This clarification is made not by chance. It should be kept in mind that representatives of the Central Bank and some state officials repeatedly expressed serious concerns about the possible use of cryptocurrencies in Russia, explaining this by the risks that arise when they are implemented in open networks without user identification.
Bitcoin was announced a monetary surrogate and they attempted to legislatively prohibit the commission of transactions with him. Even now, on the wave of general interest in blockchain and with the already obvious influence of new technologies on the configuration of the financial market, the prospects of introducing cryptocurrencies in Russia are very vague.
There is no question about creating of the Russian analog of bitcoin, except for the BitRuble, which QIWI is developing as its own virtual currency.
This project provoked diametrically opposite assessments of authorities: some considered it timely, interesting and deserving of study, others called “technical hooliganism” and an unacceptable violation of the law.
Anyway, the Central Bank still strongly recommends that the concepts of “blockchain technology” and “cryptocurrencies” be differentiated.
Such vigilance and lack of regulatory mechanisms do not allow us to expect that blockchain will take root immediately. The creation of consortium only confirms the intention of the regulator and the banks that have joined it to study the technology of distributed registers more thoroughly and the possibilities of its application.
While blockchain was tested only in information transmission systems and did not affect the money transactions. The participants of consortium planning to use cryptotechnologies in their operational activities are going to start with the launch of the ISO message system, SWIFT and other formats and only then try this technology when making payments.
Specialists of the Bank of Russia have already created a prototype (the so-called non-public blockchain system) that allows exchanging messages where the Bank acts both as a regular participant in payments and as an administrator with the right of monitoring.
In addition to joint development of blockchain prototypes, the participants of consortium will work on developing standards, creating mechanisms for simplified identification, providing users with access to financial services regardless of location, managing big data, and establishing communications with foreign developers. It is assumed that the first prototypes will be tested until the end of the current year, and in 2017 it is possible to count on emergence of innovative services for both the b2b-sector and for the final user.
From smart contracts to elections
The financial sphere is only the beginning. Blockchain technology is already used by the services of so-called smart contracts. Although foreign experience in this direction is still minimal, but there is no Russian at all, common sense promts that in the near future smart contracts will cardinally change rules of the game in business and will introduce adjustments in the practice of law enforcement.
Such contracts, unlike documents, habitual for us, are created as a program, and then executed and controlled automatically.
For example, money is debited from the buyer’s account after the goods marked in a special way are delivered and passed the appropriate testing in the warehouse. And all this is without intervention of a “human factor”.
The winner is the business that has managed to significantly reduce expenses, and at the same time to avoid mistakes and misunderstandings when negotiating and carrying out transactions, as well as the state that, for example, has the ability to control the payment of taxes in real time.
The important advantage of blockchain is the reliable, accurate and impartial fixation of information of any kind, whether it be historical chronicles or property rights. Therefore, the technology of distributed registries can help the state not only in collecting taxes, but also in the distribution of social benefits, issuance of passports, maintaining of land cadastres…
Probably, representatives of public health, insurance business, the licensing organizations and other structures with active document circulation will soon join the participants of the Russian blockchain-consortium.
Honesty is the best policy. This well-known proverbial adage can be interpreted literally. The technology of distributed registries may well be involved in the course of elections of various level. Falsification of results is certainly impossible, as well as hiding information from candidate profiles.
Blockchain is developing very quickly, covering more and more new spheres of our life. Geographical, as, however, any other boundaries for it are not important. And for us it is important, in the words of the representatives of the domestic bank sphere and business, “not to miss blockchain”, to “saddle the topic” and to become one of the advanced countries open for new and undoubtedly extremely perspective technology.
This post is also available in: Russian