In news:

• With a view to enabling growers find better price for their produce, the Coffee Board has launched Coffee Blockchain, a marketplace app, developed in coordination with Eka Software Solutions.
• The pilot project has about 20 participants, including 14 coffee growers, and will run for four-to-six months.
• The block chain-enabled marketplace was aimed at reducing growers’ dependency on intermediaries, bring in trust and efficiency in the chain, help farmers with market access, and ensure traceability.
• Anyone willing to participate in the marketplace will have to register on the app and will get a smart contract number.

Important Value Additions:

About Blockchain technology

• Blockchain can be thought of as a public account ledger, an immutable, transparent and permanent one. Each transaction is recorded and stored in the ledger that is out on a public bulletin board. Every transaction adds a block to the chain of transactions and each one is evaluated by every user based on algorithms they’ve agreed upon. Rather than being kept in single location, a copy of the blockchain is stored on every user’s server so that a user cannot alter it without other users finding out. Even though blockchain was conceived for financial transactions, its characteristics make it an apt solution that can support voting systems.
• Due to its unique attributes of trust, transparency and immutability, such a system is expected to mitigate issues like vote manipulation in political processes.
• Blockchain is the backbone technology on which bitcoins run. Simply put, it is a digital public ledger that records every transaction. Once a transaction is entered in the blockchain, it cannot be erased or modified. Blockchain removes the need for using a trusted third party such as a bank to make a transaction by directly connecting the customers and suppliers.
• Each transaction is recorded to the ledger after verification by the network participants, mainly a chain of computers, called nodes. While the origin of the technology is not clear, it is widely believed that a person or group of people by the pseudonym Satoshi Nakamoto, who invented bitcoins, released the technology to support cryptocurrency.
• Bitcoin is just one of the applications for the technology, whose use is being tested across industries. It is witnessing a lot of traction within India, in sectors such as banking and insurance. In most of these industries, players are coming together to form a consortium to realise the benefits of blockchain at an industry level.
• For example, in India, there is a consortium ‘BankChain’ which has about 27 banks from India (including State Bank of India or SBI and ICICI) and the Middle East as its members. The consortium is exploring using usage of Blockchain technology to make business safer, faster and cheaper.
• The Institute for Development and Research in Banking Technology (IDRBT), an arm of the Reserve Bank of India (RBI), is developing a model platform for blockchain technology.
• Blockchain is expected to improve the efficiency of a transaction by eliminating the middlemen, while also reducing the cost of all transactions. It is also likely to increase transparency and bring down fraud as every transaction would be recorded and distributed on a public ledger.