Mass Incarceration

Where does Bangladesh stand on adopting Blockchain technology?

In 2016, North Korean hackers stole $81 million from Bangladesh Financial institution. Referred to as ‘the Lazarus Heist,’ it’s the largest cyber heist on the planet until date. 

The cash was stolen from Bangladesh Financial institution’s account in New York Federal Reserve Financial institution.  A surprising facet of the historic heist was the hackers managed to entry SWIFT, thought of essentially the most safe technique for transferring massive sums of cash from financial institution to financial institution. 

Though most high-value monetary transactions on the planet are carried out by means of SWIFT, it has come beneath criticism sometimes for ‘inefficiency’. In 2018, for instance, the Monetary Instances famous that transfers are “time-consuming, expensive and missing transparency.”

As US Congresswoman Carolyn Maloney, a member of the congressional committee on monetary companies advised BBC “with SWIFT underpinning so many billions of {dollars} of world commerce, a hack like this [Lazarus Heist] might fatally undermine confidence within the system.”

Istiaque Ahmed agrees with this view. He’s a blockchain developer and analysis scientist on the Blockchain Financial system Analysis Middle at Gwangju Institute of Science and Know-how (GIST), South Korea. In keeping with him, if blockchain expertise is used, then these varieties of economic frauds can doubtlessly be prevented.

Thus far, just a few monetary establishments in Bangladesh have already began to undertake blockchain expertise, similar to Normal Chartered Financial institution, Prime Financial institution, HSBC Financial institution and so on in addition to bKash. Furthermore, just a few agro-tech startups have adopted the expertise as a pilot mission, together with Krishi Swapno.

Bkash, as an illustration, launched blockchain in 2020 to facilitate inbound remittance from Malaysia. Bkash partnered with Cell Cash (a Malaysian cellular pockets firm) and Ripple (a blockchain-based world cost resolution supplier) to permit wallet-to-wallet funds to create this remittance hall between the 2 nations.

In the meantime, the Bangladesh-based banks executed quite a few letter of credit score (LC) transactions by means of blockchain within the final two years. Krishi Swapno, which calls itself a blockchain-based agricultural expertise platform, reportedly has carried out blockchain on a pilot mission in its provide chain. 

How blockchain works

First, let’s perceive the fundamental idea of blockchain expertise. To take action, IBM’s e book “Blockchain for dummies” is useful. IBM describes blockchain, in brief, on this means: Blockchain is a shared, immutable ledger that facilitates the method of recording transactions and monitoring property in a enterprise community.

The important thing components of a blockchain are a) distributed ledger expertise; b) immutable data; and c) good contracts. And that is how blockchain works: as every transaction happens, it’s recorded as a “block” of information; every block is linked to those earlier than and after it; and transactions are blocked collectively in an irreversible chain: a blockchain.

A legitimate transaction will need to have an entry in any system’s database. In earlier occasions, for instance, banks had entries within the ledger (a e book through which the financial transactions are recorded). Blockchain is such a ledger the place there are numerous blocks facet by facet, thus creating a sequence. Every block accommodates all the info of all of the transactions that happened throughout a time period.

This knowledge is open however encrypted i.e. everybody can see this knowledge however to learn it, one wants a ‘personal key’. That means, solely you probably have undertaken a transaction are you able to learn all of your transaction data from right here utilizing its personal key; nobody else can. However what individuals will see is the transaction quantity.

Blockchain in Bangladesh

Just a few examples of using blockchain have been recorded in Bangladesh within the final couple of years. Most are on a pilot foundation or single-case use. Whereas just a few monetary establishments have additionally launched this expertise, widespread utility will not be seen within the nation. 

Since 2020, bKash has been utilizing state-of-the-art blockchain expertise to facilitate safer, sooner and dependable inbound remittance. In a response to our e-mail, bkash’s communications crew replied:

“In a nutshell, using blockchain has simplified bKash’s remittance service and ensured these: Decentralised construction; Improved safety and privateness; Tokenization (Safety Characteristic); Velocity (Actual-time replace); and Visibility and traceability.”

They added, “Notable that Malaysia is without doubt one of the prime 10 sources of remittances for Bangladesh. This partnership has created the power to raised serve the remitters with a less expensive, quick, clear and dependable remittance-sending expertise to thousands and thousands of non-resident Bangladeshis all around the world. The goal of this partnership is to deliver nice comfort to each recipients, and senders and contribute additional to Bangladesh’s nationwide economic system by encouraging inward overseas remittance circulation by means of authorized channels.”

Prime Financial institution claimed to be the primary Bangladeshi financial institution to execute an interbank blockchain LC transaction in December 2020 with HSBC financial institution. The pilot transaction was accomplished by means of Contour – a worldwide blockchain community – whereby an inland LC was opened by Prime Financial institution on behalf of Ananta Group. This transaction was executed for the import of uncooked supplies from Tamishna Group, a buyer of HSBC Bangladesh.

They mentioned: “The tip-to-end technique of pre-negotiation and drafting of LCs by importer and beneficiary, approval, issuance of LCs and presentation of paperwork had been all concluded digitally by means of Contour’s community. The transaction required no paperwork or have to bodily go to banks. As a substitute, all events concerned within the course of – patrons, banks and beneficiaries – logged into Contour’s community to hold out any exercise.”

In August 2020, Normal Chartered Financial institution executed a blockchain transaction by issuing an LC for Viyellatex Ltd, an RMG firm in Bangladesh, performing because the issuing financial institution for the applicant. This transaction was additionally executed by means of Contour.

The identical yr, HSBC turned the primary Bangladeshi financial institution to carry out a cross-border blockchain transaction. The financial institution opened a cross-border mortgage for the import of 20,000 tonnes of gas from Singapore in favour of United Mymensingh Energy Restricted by means of blockchain expertise. After opening the LC, United Mymensingh Energy Restricted advised the media that whereas it took 5 to 10 days to open an LC earlier, with the brand new expertise it took lower than 24 hours.

Krishi Shwanpo, an agro-tech startup, has initiated using blockchain in its provide chain administration. In keeping with Zubaer Hassan, CEO of Krishi Shwapno, the acknowledged objective of the mission was to create a traceable atmosphere by gathering knowledge from all provide chain stakeholders – from farmers to companies to prospects. He hopes that blockchain expertise will acquire customers’ belief within the worth chain. Blockchain’s traceability will permit prospects to seek out details about merchandise simply, as an illustration, the origin and commonplace of meals.

Advantages of blockchain

Md Al Amin, Founder and CEO of Deepchain Labs, can also be a lecturer of CS at AIUB. Deepchain Labs is a blockchain ecosystem firm based mostly in Bangladesh that gives companies to overseas clientele.

“Blockchain expertise is a novel innovation of current occasions. It’s the most safe and open technique of information storage ever invented. This expertise is revolutionising the pace and effectivity of transactions,” he mentioned. 

To date the applying of this expertise continues to be in its infancy. However technologists largely agree that it could play a constructive function in varied industries and sectors, together with banking, commerce, provide chain, asset administration, digital identification and licensing, regulatory compliance, buying and selling processing, insurance coverage, anti-counterfeiting and so on. 

“Meaning any business that requires the change of data,” defined Md Al Amin.

In truth, companies and monetary establishments all around the world are more and more adopting blockchain expertise. Although blockchain is normally related to crypto, it’s not at all times the case. Furthermore, blockchain will not be at all times about monetary dealings. It may be used for issues similar to licensing, digitalisation of paperwork, certification verification and so on. 

Many central banks are already exploring CBDC (central financial institution digital forex), which relies on blockchain. As of 2022, 9 nations together with Nigeria, The Bahamas and Grenada, have rolled out their very own CBDCs. 

In March final yr, US president Biden directed the nation’s companies to discover a government-controlled digital forex. Our neighbouring nation India’s central financial institution, the Reserve Financial institution of India (RBI), has mentioned final yr that it’s exploring ‘a digital rupee’ which might doubtlessly be launched within the coming yr. And in line with Atlantis Council’s CBDC tracker, some 80 nations have some type of CBDC mission.

“Blockchain permits corporations to have near-instant entry to their funds from anyplace on the planet at any time. Money transactions can run at a relentless tempo to satisfy the corporate’s working capital and world money wants. And on this case, the safety danger is lower than any expertise invented so far. That’s, the safety system is the strongest in blockchain expertise,” mentioned Al Amin.

He expounded on one business and the way it could possibly be benefited from utilizing blockchain: “The RMG business is the principle export sector of Bangladesh. Most uncooked supplies on this business are sourced regionally, by means of inland letters of credit score. These inland LCs contain a whole lot of tedious paperwork. If these transactions will be moved right into a paperless blockchain, main efficiencies will be achieved in native commerce throughout this business. There’s a large scope to scale up transactions over blockchain if all events of the RMG provide chain will be added to this community,” mentioned Al Amin

Al Amin nevertheless identified that even on a worldwide scale, the applying of the expertise continues to be in its infancy. All of the fanfare and optimism apart, the world’s largest banks and nations are cautiously watching the event of the expertise. In most developed nations, central banks and different monetary establishments are both experimenting with it or have launched it on a pilot foundation. 

Primarily, it’s not all roses. A number of the regarding points are financial coverage affect and cybersecurity. And most significantly, why banks and governments usually are not dashing in is that this tech requires a rupture from the normal monetary construction, which could show dangerous to hurry.

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Tha Bosslady

CREEDD (Creative Resilient Empowered Entrepreneurs and Diversified Dreamers) is a dynamic and purpose-driven platform that I founded with a deep commitment to empowering individuals facing adversity. It serves as a sanctuary where people can find solace, support, and valuable resources to navigate life's challenges while uncovering their true potential. My personal journey of enduring loss, tragedy, and life's complexities propelled me to establish CREEDD with a profound understanding of the human spirit's resilience. Having faced the heart-wrenching loss of my daughter to gun violence, my stepdaughter's survival after losing an eye to domestic violence, and witnessing my only biological son receiving a life sentence for a nonviolent drug crime, I am no stranger to life's darkest moments. In addition to my own struggles, I experienced health challenges that led me to undergo a tracheotomy. The most devastating blow came when my stepdaughter and granddaughter tragically lost their lives in a horrific car accident. Yet, it is precisely through these trials that I gained invaluable insights and unwavering determination to inspire others. CREEDD is more than a community; it's a lifeline for those seeking hope, inspiration, and empowerment. By sharing my personal story and the lessons learned, I aspire to ignite a spark of resilience within every member, encouraging them to rise above their challenges and embrace their unique journeys. At CREEDD, we believe in the transformative power of storytelling. It is through these stories that we connect with others who have endured similar struggles, creating an unbreakable bond of understanding and support. Our platform fosters an environment of empowerment, providing resources, educational content, and opportunities for personal growth. Our ultimate goal is to leave a lasting and positive impact on the lives of those who join CREEDD. We envision a ripple effect of change, where individuals find the courage to rewrite their narratives, rediscover their purpose, and lead lives filled with resilience and fulfillment. Together, we form a community of diverse dreamers, each on their unique path of transformation. At CREEDD, we embrace growth, uplift one another, and become beacons of hope. Join us on this transformative journey and witness the power of unity, compassion, and the unwavering pursuit of living life on purpose, no matter the adversities we face.

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