#FactCheck - Debunking Viral Photo: Tears of Photographer Not Linked to Ram Mandir Opening

According to Statista, the number of users in India's digital assets market is expected to reach 107.30m users by 2025 (Impacts of Inflation on Financial Markets, August 2023). India's digital asset market has been experiencing exponential growth fueled by the increased adoption of cryptocurrencies and blockchain technology. This furthers the need for its regulation. Digital assets include cryptocurrencies, NFTs, asset-backed tokens, and tokenised real estate. 

India has defined Digital Assets under Section 47(A) of the Income Tax Act, 1961. The Finance Act 2022-23 has added the word 'virtual' to make it “Virtual Digital Assets”. A “virtual digital asset” is any information or code, number, or token, created through cryptographic methods or otherwise, by any name, giving a digital representation of value exchanged with or without consideration. A VDA should contain an inherent value and represent a store of value or unit of account, functional in any financial transaction or investment. These can be stored,  transferred, or traded in electronic format. 

Digital Asset Governance: Update and Future Outlook

Indian regulators have been conservative in their approach towards digital assets, with the Reserve Bank of India first issuing directions against cryptocurrency transactions in 2018. This ban was removed by the Supreme Court through a court order in 2020. The presentation of the Cryptocurrency and Regulation of Official Digital Currency Bill of 2021 is a fairly important milestone in its attempts to lay down the framework for issuing an official digital currency by the Reserve Bank of India. While some digital assets seem to have potential, like the Central Bank Digital Currencies (CBDCs) and blockchain-based financial applications, a blanket prohibition has been enforced on private cryptocurrencies.

However, in more recent trends, the landscape is changing as the RBI's CBDC is to provide a state-backed digital alternative to cash under a more structured regulatory framework. This move seeks to balance state control with innovation on investor safety and compliance, expecting to reduce risk and enhance security for investors by enacting strict anti-money laundering and know-your-customer laws. Highlighting these developments is important to examine how global regulatory trends influence India's digital asset policies.

Impact of Global Development on India’s Approach 

Global regulatory developments have an impact on Indian policies on digital assets. The European Union's Markets in Crypto-assets (MiCA) is to introduce a comprehensive regulatory framework for cryptocurrencies that could act as an inspiration for India. MiCA regulation covers crypto-assets that are not currently regulated by existing financial services legislation. Its particular focus on consumer protection and market integrity resonates with India in terms of investigating needs related to digital assets, including fraud and price volatility. Additionally, evolving policies in the US, such as regulating crypto exchanges and classifying certain tokens as securities, could also form the basis for India's regulatory posture.

Collaboration on the international level is also a chief contributing factor. India’s regular participation in global forums like the G20, facilitates an opportunity to align its regulations on digital assets with other countries, tending toward an even more standardised and predictable framework for cross-border transactions. This can significantly help India given that the nation  has a huge diaspora providing a critical inflow of remuneration.

CyberPeace Outlook

Though digital assets offer many opportunities to India, challenges also exist. Cryptocurrency volatility affects investors, posing concerns over fraud and illicit dealings. A balance between the need for innovation and investor protection is paramount to avoid killing the growth of India's digital asset ecosystem with overly restrictive regulations.

Financial inclusion, efficient cross-border payments with low transaction costs, and the opening of investment opportunities are a few opportunities offered by digital assets. For example, the tokenisation of real estate throws open real estate investment to smaller investors. To strengthen the opportunities while addressing challenges, some policy reforms and new frameworks might prove beneficial. 

CyberPeace Policy Recommendations

• Establish a regulatory sandbox for startups working in the area of blockchain and digital assets. This would allow them to test innovative solutions in a controlled environment with regulatory oversight minimising risks.
• Clear guidelines for the taxation of digital assets should be provided as they will ensure transparency, reduce ambiguity for investors, and promote compliance with tax regulations. Specific guidelines can be drawn from the EU's MiCA regulation.  
• Workshops, online resources, and campaigns are some examples of initiatives aimed at improving consumer awareness about digital assets, benefits and associated risks that should be implemented. Partnerships with global fintech firms will provide a great opportunity  to learn best practices.

Conclusion

India is positioned at a critical juncture with respect to the debate on digital assets. The challenge which lies ahead is one of balancing innovation with effective regulation. The introduction of the Central Bank Digital Currency (CBDC) and the development of new policies signal a willingness on the part of the regulators to embrace the digital future. In contrast, issues like volatility, fraud, and regulatory compliance continue to pose hurdles. By drawing insights from global frameworks and strengthening ties through international forums, India can pave the way for a secure and dynamic digital asset ecosystem. Embracing strategic measures such as regulatory sandboxes and transparent tax guidelines will not only protect investors but also unlock the immense potential of digital assets, propelling India into a new era of financial innovation and inclusivity.

References

• https://www.weforum.org/agenda/2024/10/different-countries-navigating-uncertainty-digital-asset-regulation-election-year/ 
• https://www.acfcs.org/eu-passes-landmark-crypto-regulation 
• https://www.indiabudget.gov.in/budget2022-23/doc/Finance_Bill.pdf 
• https://www.weforum.org/agenda/2024/10/different-countries-navigating-uncertainty-digital-asset-regulation-election-year/
• https://www3.weforum.org/docs/WEF_Digital_Assets_Regulation_2024.pdf 

‍

Introduction

A hacking operation has corrupted data on Madhya Pradesh's e-Nagarpalika portal, a vital online platform for paying civic taxes that serves 413 towns and cities in the state. Due to this serious security violation, the portal has been shut down. The incident occurred in December 2023. This affects citizens' access to vital online services like possessions, water, and municipal tax payments, as well as the issuing of obituaries and certain documents offered via online portal. Ransomware which is a type of malware encodes and conceals a victim's files, and data making it inaccessible and unreachable unless the attacker is paid a ransom. When ransomware initially appeared, encryption was the main method of preventing individuals' data from such threats.

The Intrusion and Database Corruption: Exposing the Breach's Scope

The extent of the assault on the e-Nagarpalika portal was revealed by the Principal Secretary of the Urban Administration and Housing Department of Madhya Pradesh, in a startling revelation. Cybercriminals carried out a highly skilled assault that led to the total destruction of the data infrastructure covering all 413 of the towns for which the website was responsible.

This significant breach represents a thorough infiltration into the core of the electronic civic taxation system, not just an arrangement. Because of the attackers' nefarious intent, the data integrity was compromised, raising questions about the safeguarding of private citizen data. The extent of the penetration reaches vital city services, causing a reassessment of the current cybersecurity safeguards in place. 

In addition to raising concerns about the privacy of personal information, the hacked information system casts doubt on the availability of crucial municipal services. Among the vital services affected by this cyberattack are marriage licenses, birth and death documents, and the efficient handling of possessions, water, and municipal taxes.

The weaknesses of electronic systems, which are the foundation of contemporary civic services, are highlighted by this incident. Beyond the attack's immediate interruption, citizens now have to deal with concerns about the security of their information and the availability of essential services. This tragedy is a clear reminder of the urgent need for robust safety safeguards as authorities work hard to control the consequences and begin the process of restoration.

Offline Protections in Place

The concerned authority informed the general population that the offsite data, which has been stored up on recordings every three days, is secure despite the online attack. This preventive action emphasises how crucial offline restores are to lessening the effects of these kinds of cyberattacks. The choice to keep the e-Nagarpalika platform offline until a certain time highlights how serious the matter is and how urgently extensive reconstruction must be done to restore the online services offer

Effect on Civic Services

The e-Nagarpalika website is crucial to providing online municipal services, serving as an invaluable resource for citizens to obtain necessary paperwork and carry out diverse transactions. Civic organisations have been told to function offline while the portal remains unavailable until the infrastructure is fully operational. This interruption prompts worries about possible delays and obstacles citizens face when getting basic amenities during this time.

Examination and Quality Control

Information technology specialists are working diligently to look into the computer virus and recover the website, in coordination with the Madhya Pradesh State Electronic Development Corporation Limited, the state's cyber police, and the Indian Computer Emergency Response Team (CERT-In). Reassuringly for impacted citizens, authorities note that there is currently no proof of data leaks arising from the hack.

Conclusion

The computerised attack on the e-Nagarpalika portal in Madhya Pradesh exposes the weakness of computer networks. It has affected the essential services to public services offered via online portal. The hack, which exposed citizen data and interfered with vital services, emphasises how urgently strong safety precautions are needed. The tragedy is a clear reminder of the need to strengthen technology as authorities investigate and attempt to restore the system. One bright spot is that the offline defenses in place highlight the significance of backup plans in reducing the impact of cyberattacks. The ongoing reconstruction activities demonstrate the commitment to protecting public data and maintaining the confidentiality of essential city operations.

References

• https://government.economictimes.indiatimes.com/tag/cyber+attack
• https://www.techtarget.com/searchsecurity/definition/ransomware#:~:text=Ransomware%20is%20a%20type%20of,accessing%20their%20files%20and%20systems.
• https://www.business-standard.com/india-news/mp-s-e-nagarpalika-portal-suffers-cyber-attack-data-corrupted-officials-123122300519_1.html
• https://www.freepressjournal.in/bhopal/mp-govts-e-nagar-palika-portal-hacked-data-of-over-400-cities-leaked

There has been a struggle to create legal frameworks that can define where free speech ends and harmful misinformation begins, specifically in democratic societies where the right to free expression is a fundamental value.  Platforms like YouTube, Wikipedia, and Facebook have gained a huge consumer base by focusing on hosting user-generated content. This content includes anything a visitor puts on a website or social media pages. 

The legal and ethical landscape surrounding misinformation is dependent on creating a fine balance between freedom of speech and expression while protecting public interests, such as truthfulness and social stability. This blog is focused on examining the legal risks of misinformation, specifically user-generated content, and the accountability of platforms in moderating and addressing it.

The Rise of Misinformation and Platform Dynamics

Misinformation content is amplified by using algorithmic recommendations and social sharing mechanisms. The intent of spreading false information is closely interwoven with the assessment of user data to identify target groups necessary to place targeted political advertising. The disseminators of fake news have benefited from social networks to reach more people, and from the technology that enables faster distribution and can make it more difficult to distinguish fake from hard news.

Multiple challenges emerge that are unique to social media platforms regulating misinformation while balancing freedom of speech and expression and user engagement. The scale at which content is created and published, the different regulatory standards, and moderating misinformation without infringing on freedom of expression complicate moderation policies and practices.

The impacts of misinformation on social, political, and economic consequences, influencing public opinion, electoral outcomes, and market behaviours underscore the urgent  need for effective regulation, as the consequences of inaction can be profound and far-reaching.

Legal Frameworks and Evolving Accountability Standards

Safe harbour principles allow for the functioning of a free, open and borderless internet. This principle is embodied under the US Communications Decency Act and the Information Technology Act in Sections 230 and 79 respectively.  They play a pivotal role in facilitating the growth and development of the Internet. The legal framework governing misinformation around the world is still in nascent stages. Section 230 of the CDA protects platforms from legal liability relating to harmful content posted on their sites by third parties. It further allows platforms to police their sites for harmful content and protects them from liability if they choose not to.

By granting exemptions to intermediaries, these safe harbour provisions help nurture an online environment that fosters free speech and enables users to freely express themselves without arbitrary intrusions.

A shift in regulations has been observed in recent times. An example is the enactment of the Digital Services Act of 2022 in the European Union.  The Act requires companies having at least 45 million monthly users to create systems to control the spread of misinformation, hate speech and terrorist propaganda, among other things. If not followed through, they risk penalties of up to 6% of the global annual revenue or even a ban in EU countries.

Challenges and Risks for Platforms

There are multiple challenges and risks faced by platforms that surround user-generated misinformation. 

• Moderating user-generated misinformation is a big challenge, primarily because of the quantity of data in question and the speed at which it is generated. It further leads to legal liabilities, operational costs and reputational risks.   
• Platforms can face potential backlash, both in instances of over-moderation or under-moderation. It can be considered as censorship, often overburdening. It can also be considered as insufficient governance in cases where the level of moderation is not protecting the privacy rights of users. 
• Another challenge is more in the technical realm, including the  limitations of AI and algorithmic moderation in detecting nuanced misinformation. It holds out to the need for human oversight to sift through the misinformation that is created by AI-generated content.  

Policy Approaches: Tackling Misinformation through Accountability and Future Outlook

Regulatory approaches to misinformation each present distinct strengths and weaknesses. Government-led regulation establishes clear standards but may risk censorship, while self-regulation offers flexibility yet often lacks accountability. The Indian framework, including the IT Act and the Digital Personal Data Protection Act of 2023, aims to enhance data-sharing oversight and strengthen accountability. Establishing clear definitions of misinformation and fostering collaborative oversight involving government and independent bodies can balance platform autonomy with transparency. Additionally, promoting international collaborations and innovative AI moderation solutions is essential for effectively addressing misinformation, especially given its cross-border nature and the evolving expectations of users in today’s digital landscape.

Conclusion

A balance between protecting free speech and safeguarding public interest is needed to navigate the legal risks of user-generated misinformation poses. As digital platforms like YouTube, Facebook, and Wikipedia continue to host vast amounts of user content, accountability measures are essential to mitigate the harms of misinformation. Establishing clear definitions and collaborative oversight can enhance transparency and build public trust. Furthermore, embracing innovative moderation technologies and fostering international partnerships will be vital in addressing this cross-border challenge. As we advance, the commitment to creating a responsible digital environment must remain a priority to ensure the integrity of information in our increasingly interconnected world.

References

• https://www.thehindu.com/opinion/op-ed/should-digital-platform-owners-be-held-liable-for-user-generated-content/article68609693.ece
• https://www.thehindu.com/opinion/op-ed/should-digital-platform-owners-be-held-liable-for-user-generated-content/article68609693.ece 
• https://hbr.org/2021/08/its-time-to-update-section-230 
• https://www.cnbctv18.com/information-technology/deepfakes-digital-india-act-safe-harbour-protection-information-technology-act-sajan-poovayya-19255261.htm 

‍