Q1. “The regulation of blockchain technologies will turn them into threats or opportunities.” Discuss.
Framework
- Highlight the importance of blockchain technology along with its key features
- Bring out the threats due to blockchain adoption particularly as currency
- Write about the importance of regulation in societies characterised by technology disruption
- Throw light on vertical and horizontal regulation
- Conclude
Model Answer
Given the advantages of blockchain technology namely disintermediation, provenance, immutability and decentralization it should be leveraged for potential use cases as in record management systems, supply-chain management, digital currency, taxation, voting etc. However the anonymization that the technology offers poses significant threats particularly malpractices like illegal trade, fraud, money-laundering etc. This merits a balanced approach which stays away from horizontal regulation to leverage the technology and resultant innovations and a strict vertical regulation particularly in the financial and capital market sectors.
Since technological innovations inevitably outpaces regulation broadly regulatory goals should be to
- Encourage innovation
- Ensure consumer protection
- Prevent money-laundering
- Prevent fraud
- Taxation regime for cross-border flow
In line with this India is taking a good step in accordance with the recommendation of Subhash Garg Committee to prevent private cryptocurrencies to function as a currency instead be treated as a financial asset under the proposed Cryptocurrency Regulation Bill 2021. Thus cryptocurrencies will be rightly subject to capital market regulations of SEBI.
Thus the regulatory aspects should include consumer protection by framing rules for cryptocurrency activities such as Initial Coin Offerings, imposing capital gains tax(this is done in budget 2022-23), increased consumer awareness regarding the high-volatile nature of cryptocurrencies, ways to stop malpractices like short-selling etc.
Thus regulation of blockchain technology should be functional (vertical) and technology-neutral (not horizontal) in accordance with regulatory principles and goals.
Q2. The recently launched Earth Bio-Genome Project is considered to be the most ambitious project in the field of biology ever. What is Earth Bio-Genome Project? Discuss the significance of the project and related issues of digital bio-piracy? Also add a note on human genome sequencing?
Framework
- Introduce with what is Earth Bio-Genome Project and its significance.
- Discuss the issue of digital bio-piracy arising out of genome sequencing efforts.
- Explain genome sequencing
- Write a note on significance of human genome sequencing
Model Answer
Earth Bio-Genome project involves genome sequencing of all known species of eukaryotes, about 1.5 million, including all plants, animals and unicellular organisms on earth. The project will lead to better understanding of organization and evolution of all life forms and thus significant in stepping up scientific research towards
- Conservation efforts of ecology
- Protection and restoration of biodiversity
- New research in agriculture to ensure food security
- Developing new drugs, treatments for both infectious and genetic diseases.
- Changing the material science landscape by developing novel synthetic bio-materials
- Contribute to low-carbon energy security through development of bio-synthetic fuels
Digital Bio-Piracy
The Nagoya protocol to Convention of Biodiversity requires that the benefits accruing out of study of biodiversity of a region be shared with the local communities of the corresponding region.
However the efforts of digitizing sequenced genomes is available to all and hence may lead to digital bio-piracy. Thus any massive genome sequencing effort should correspond with mechanisms to ensure the benefits accrued be shared with the concerned local communities.
Genome Sequencing
Genome is the full set of DNA present in an individual of any species. Genome sequencing or DNA sequencing is the procedure of mapping the individual’s entire genetic code by reading billions of nucleotide base pairs that make up the individual’s genome. Human genome sequencing is significant in
- Detecting the presence of mutations associated with genetic disorders
- Developing new diagnostics, novel drugs, new vaccines
- Deciding on appropriate treatment strategies
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