Blockchain technology in general and smart contracts in particular can “unlock the hidden values of legacy digital systems,” said the World Economic Forumor WEF. To understand how, look no further than the Indian Crop Insurance Scheme.
In a 40-page white paper published Wednesday, the Geneva-based organization promotes the importance of interoperability between legacy systems and distributed ledger technologies – but only for specific use cases suitable for blockchains.
The WEF says:
“Once readers have already determined that blockchain is desirable for their specific use cases and business processes, this paper aims to highlight the role of blockchain, smart contracts, and oracles in accelerating the automation of such processes.”
While the paper promotes highly technical and abstract solutions for improving interoperability between blockchains and legacy systems – which it calls the ‘interoperability bridge’ – it provides a tangible example in the form of IndiaThe Crop Insurance Scheme, which was designed in 2016 as a way to provide insurance coverage and financial support to farmers affected by natural disasters.
Issues ranging from transparency and accountability to corruption and information security were all raised by agencies involved in the implementation of the scheme. The white paper identifies how blockchain-based smart contracts and oracle systems can overcome these challenges.
The newspaper reads:
“The crop insurance program is a good example of highlighting the current shortcomings that most legacy systems face when dealing with multi-party business processes.”
It goes on:
“If the goal of an organization is to automate business processes in a decentralized and disintermediated way for various reasons, then a blockchain-based architecture becomes necessary.
Indian regulators have mixed feelings about cryptocurrencies, but they are much more receptive to blockchain technology. Earlier this year, the National Institution for Transforming India, a government agency, released a report on the matter explores the role of blockchain in improving business, social and governance outcomes in the country.