Reliance Jio Infocomm - the telecom arm of conglomerate Reliance Industries Ltd (RIL) - may launch its own cryptocurrency, according to a report in Mint which cited a person familiar with the development.
The above-mentioned person was quoted as saying that Akash Ambani, chief of strategy at Jio and the eldest son of RIL chairman Mukesh Ambani, will spearhead the project for a 'JioCoin'.
“The company plans to hire 50 young professionals with an average age of 25 years for Akash Ambani to lead," the person was quoted as saying. "The team would work on various blockchain products.”
Blockchain technology uses cryptographic tools to create an open and decentralised body of data, which can include banking transactions and the like. The data record can be verified by anyone involved in the transaction and can be tracked via a secure network.
Blockchain has been most prominently used for cryptocurrency transactions. The Indian government’s policy think tank, Niti Aayog, is also looking into employing blockchain technology in education, health and agriculture.
But the government has repeatedly warned against cryptocurrencies, citing volatility and risks including money laundering. It is still studying the issue.
There has been a cryptocurrency boom in the last year, with Bitcoin – the most prominent of these currencies – rising more than 1,000% in value in 2017.
According to a survey carried out by the Income Tax department, there are six lakh active cryptocurrency traders in India.
But Jio's proposed project isn't just limited to cryptocurrencies.
“One (application) is cryptocurrency. We can deploy smart contracts. It can be used in supply chain management logistics," the person familiar with the matter was quoted as saying. "Loyalty points could altogether be based on JioCoin,”
Jio has already disrupted the telecom market with its free voice calling and low tariffs since launching in September 2016. A JioCoin would open up a whole new world of possibilities Jio services and Jio's partner ecosystem.
Jio's services currently include Jio Money, Jio Cinema, Jio TV, Jio News, Jio Mags and Jio Cloud. The company may start accepting JioCoin from customers or reward them with loyalty points in this form.
For example, once JioCoin comes into play, Jio customers could possibly recharge their phones using the virtual currency and also recharge their existing Reliance Jio broadband and upcoming DTH platforms.
Jio, just like Airtel's Payments Bank, might allow users to recharge DTH and broadband services of other service providers if they accept virtual currencies.
Sandeep Goenka, co-founder of bitcoin exchange ZebPay, told Bitcoin.com recently that users of his app have been increasingly using the cryptocurrency to pay bills and for mobile recharges.
A JioCoin would also help the company bridge the services gap by reaching the unbanked masses, given that it is already providing connectivity in rural areas and offering a low-cost device in the form of its JioPhone.
“Reliance is one of the leading companies in many sectors including energy, telecom, retail in India. These sectors will be an ideal ground for the company to test use cases of blockchain applications for the future," Pavel Naiya, senior research analyst with Counterpoint Research, told VCCircle.
Tie-ups with other stakeholders could see services such as insurance premiums, grocery shopping, electricity recharges also coming into play. In other words, all wallet or payment app offerings we see today from Paytm, Mobikwik, Google Tez can be bundled into Jio Wallet using JioCoin.
In terms of loyalty points, Jio can ensure traction for its other apps by crediting users with currencies that they can spend on the Jio platform. For instance, if you see say 12 hours of Jio content then you get credited with 5 JioCoins that you can spend on the Ajio shopping app.
Jio sees itself going beyond these applications.
"Reliance Jio also aspires to get into Internet of Things (IoT). Blockchain technology would come in handy there,” the Mint source said.
The Internet of things (IoT) is the network of physical devices, vehicles, home appliances and other items embedded with electronics, software, sensors, actuators, and network connectivity which enables these objects to connect and exchange data.
"With deep pockets and existing business expertise, Reliance will likely get first-mover advantage in India," Naiya said.