Cryptocurrency " Present & Future " in India

 Cryptocurrency " Present & Future " in India

Definition

A cryptocurrency is a digital or virtual currency that uses cryptography for security. Cryptocurrencies use decentralized technology to let users make secure payments and store money without the need to use their name or go through a bank.

They run on a distributed public ledger called blockchain, which is a record of all transactions updated and held by currency holders. the most common cryptocurrencies are Bitcoin, Libra, Ethereum, Ripple.

BlockChain - It is a Digital Ledger. (Ledger is a book containing accounts to which debits and credits are posted from books of original entry). A blockchain is a digitized, decentralized, public ledger.

Cryptocurrency in India

In the last 1 or 2 years, the market of cryptocurrency is increased up to 500% but the share of India is approximately 0.2% and it has some reasons like:

• Circular issued by RBI in 2018, preventing all banks from dealing in cryptocurrencies. But in 2020 Supreme Court declared it unconstitutional.
• Lack of government support for Cryptocurrency
• It is not a legal tender
• Government announcement to introduce a bill; Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, to create a sovereign digital currency and simultaneously ban all private cryptocurrencies
• There is nobody or any framework for the regulation of the cryptocurrency
• Cryptocurrencies neither offer direct use value nor possess significant exchange value, can buy you very few real goods and services. like gold and silver.

These are some of the reasons because of which investors, blockchain entrepreneurs are afraid to invest in cryptocurrency and prefer to go and invest in those countries where cryptocurrency has a safe future.

But, since 2020, when the supreme court overturned an order by the Reserve Bank of India dated April 6, 2018, restricting the use of cryptocurrencies; traffic in domestic cryptocurrency exchange in India has grown manyfold. Unlike previous rallies, the current rally in bitcoin has witnessed the increasing participation of retail investors in India.

Future of Cryptocurrency in India

Yet, the future of bitcoin and other cryptocurrencies is unlikely to be as bright as many believe it to be. But still, there are chances that government will launch its own digital currency, and make it secure for people, and regulate it securely among the people of the country. Also, the government must keep in view the past mistakes, when technology was advancing all over the world in the 90s, India could not make significant improvements. But with time India has come a way forward in technological development but still, it could not match countries like USA and China. Blockchain technology has many applications which are discovered and many are yet to be discovered if India does not participate in it actively it will regret future on its decisions. Showing interest in newly discovered blockchain technology can be a step forward for India.

Issues Associated With Banning Decentralised Cryptocurrencies

• Brain-Drain
  • Ban on crypto-currencies is most likely to result in an exodus of both talent and business from India, similar to what happened after the RBI's 2018 ban,
  • Back then, Blockchain experts moved to countries where crypto was regulated, such as Switzerland, Singapore, Estonia, and the US
  • With a blanket ban, blockchain innovation, which has uses in governance, data economy, and energy, will come to halt in India.
• In Contradiction with Policies
  • Banning crypto-currency is inconsistent with the Draft National Strategy on Blockchain, 2021 of the Ministry of Electronics and IT(MeitY), which hailed blockchain technology as transparent, secure, and efficient technology that puts a layer of trust over the internet
• Will Deprive of Transformative Technology
  • A ban will deprive India, its entrepreneurs, and citizens of a transformative technology that is being rapidly adopted across the world, including by some of the largest enterprises such as Tesla and MasterCard.

Way Forward

• Regulation is the most effective solution and it should be clear, transparent, coherent, and animated by a vision of what it seeks to achieve
• Strong KYC Norms
• Ensuring Transparency
• Igniting the Entrepreneurial wave

Cryptocurrencies and Blockchain technology can reignite the entrepreneurial wave in India's startup ecosystem and create job opportunities across different levels, from blockchain developers to designers, project managers, business analysts, promoters, and marketers.