A report co-authored by representatives of the World Economic Forum and Chainlink stated that blockchain technology, especially smart contracts, can “release the hidden value of traditional digital systems.” India’s crop insurance plan can help us understand the details.
In a 40-page white paper released on Wednesday, the World Economic Forum emphasized the importance of interoperability between traditional systems and distributed ledger technology, but distributed ledger technology is only suitable for specific use cases suitable for blockchain.
“Readers have determined that blockchain is beneficial for their specific use cases and business processes, and this white paper aims to focus on the role of blockchain, smart contracts, and oracles in accelerating the automation of such processes.”
However, the white paper highly advocates the use of technology and abstract solutions to improve the interoperability between blockchains and traditional systems. It calls it an “interoperability bridge”-a tangible example is India’s crop insurance The plan, which was formulated in 2016, aims to provide insurance and financial support to farmers affected by natural disasters.
The agencies involved in implementing the plan raised issues of transparency, accountability, corruption and information security. The white paper points out how blockchain-based smart contracts and oracles systems can overcome these challenges.
The white paper states:
“Crop insurance plans are an appropriate case, highlighting the shortcomings that most traditional systems currently face when dealing with multi-party business processes.”
The white paper continued:
“For various reasons, if an organization’s goal is to automate business processes in a decentralized manner, then it is imperative to establish a blockchain-based architecture.”
Indian regulators have mixed attitudes towards cryptocurrencies, but their acceptance of blockchain technology is much higher. Earlier this year, the National Research Institute of India released a report that explored the role of blockchain in improving Indian business, social, and governance outcomes.
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