Web3 is a term used to refer to the evolution of blockchain technology that allows people to create decentralized applications and services on top of existing technologies. The article compares it to a big garden on the internet where people can plant and grow their own flowers. Everyone gets their own little plot of land to plant their seeds, and they can share their blooms with others in a safe and equal way. India is leading the momentum in the Web3 space and has had an immense impact as a technological backbone and is the hub for brewing talent.
India needs to establish a nurturing environment for Web3 startups and developers, including establishing a well-defined regulatory framework that supports the growth and adoption of Web3 technologies, including blockchain, decentralized applications (dApps), and cryptocurrencies. The success of Web3 can open many possibilities for public-sector applications in arenas such as digital payments, land registrations, notarization, supply chain traceability, healthcare, education, data management, auditing, taxation, and voting.
The article also suggests that a unified strategy is required to regulate the crypto sector, with policies encouraging the use of open-source technologies to facilitate the development of innovative applications and services. India’s G20 Presidency presents an excellent opportunity to establish a regulatory framework for the emerging Web3 and cryptocurrency sector. It is essential to balance innovation with adequate regulation to ensure that the sector’s potential benefits are realized while minimizing potential risks. Implementing regulatory principles from traditional banking sectors can be a good starting point. Tight KYC (know your customer) requirements, transaction monitoring, and reporting suspicious behavior can help prevent money laundering and other illicit activities. Strict internal controls can also be put in place to ensure that financial institutions comply with regulatory requirements. Moreover, India’s active engagement with the global community can help promote international regulatory cooperation and improve the sector’s overall legitimacy.
As a major player in the global economy, India can set an example for other countries to follow and lead the way in the development of the Web3 and cryptocurrency sector. India’s G20 Presidency offers a unique opportunity to establish a regulatory framework for the emerging Web3 and cryptocurrency sector. By implementing sound regulatory principles and promoting international cooperation, India can play a crucial role in ensuring that the sector realizes its potential while mitigating potential risks