Telangana turns test bed for Web3 tech
With Web 3.0 Regulatory Sandbox, Telangana has opened doors for firms to test products, solutions among others.
Hyderabad: The Government of Telangana recently announced the launch of a Web 3.0 Regulatory Sandbox. With this, it has opened the doors for local and international firms and innovators to test technologies, products, services, solutions, business models, and even policies in a ‘live’ environment in the Sandbox. This will also help regulators identify the barriers to beneficial innovation. The applications for this will be open twice in a year.
What is Web 3.0?
It took over 10 years to transition from the original web, Web 1.0, to Web 2.0. Web 3.0 (Web3) is the third generation of web technologies and is under progress.While there is no universally accepted definition yet for Web3, the emphasis is on blockchain-based technologies, machine learning and artificial intelligence to make intelligent, adaptive and decentralised applications.
What is a Regulatory Sandbox?
A Regulatory Sandbox refers to live testing of new products or services in a controlled and/or test regulatory environment. Regulators may permit certain regulatory relaxations for the limited purpose of the testing. It allows the regulator, innovators, and service/product providers to conduct field tests, collect evidence on benefits and risks of new innovations and ideas. These will be monitored and the risks contained. Banking and insurance sectors have been using this channel to scout innovations.
How it helps:
“The Web 3.0 Regulatory Sandbox is a great initiative by the Government of Telangana. Having worked with the Telangana Government previously, most recently for the India Blockchain Accelerator, we have witnessed the progress by the State to foster Web 3.0 development and support startups with new and innovative solutions,” said Kaavya Prasad, Founder, Lumos Labs, a Singapore-based innovation management firm that runs technology open innovation programmes.
“Through the Sandbox, startups will be able to present their solutions in a secure space and receive the right regulatory support and guidance, which will be a big push to the Indian and global Web3 industry.
Given the current ambiguous regulatory environment, this initiative can encourage pioneering decentralised solutions that pass the regulatory checks and are open and secure,” she said.
This will open doors for more discussion by regulatory bodies as they will be able to identify the barriers to innovation. They can also have feedback on the current innovation ecosystem and make the required changes.
“There have been instances of legal experts providing guidance and raising awareness regarding the Web3 regulatory aspects. India is active in discussing and navigating the legal ramifications of decentralised and other emerging technology with experts. Yet, Telangana’s Web3.Regulatory Sandbox will be the first-of-its-kind where a Government is taking active steps towards providing right guidance to budding startups. It is also open to incorporate the feedback into future State policies,” she said.
What changes can happen:
“We expect good changes coming the Web3 way. Through this initiative, we are one step further into fostering innovation and working with the Web3 ecosystem to bring about a change in the current ambiguous Indian Web3 legal sector. Through the Sandbox, the Web3 startups can move ahead with their solutions or make the required changes to be legally compliant at an early stage itself, preventing permanent losses. We can track how the industry is progressing and how global and Indian Web3 ecosystems are increasing their offerings. Through this, we get valuable data that helps in creating regulations that foster innovations,” she said.
Last week, Telangana signed a Memorandum of Understanding with Coinbase Inc, a Web 3.0 giant, to collaborate towards building a strong Web 3.0 community in Telangana. It will be a technical advisor for Web3 related initiatives implemented by Telangana and also work on the Regulatory Sandbox.
