Essay On Cryptocurrency In India In 250+ Words
Essay On Cryptocurrency In India
Introduction | What is Cryptocurrency
Cryptocurrency use Distributed ledger system (DLS), It’s also known as block-chain analysis, to keep the transaction of cryptocurrency safe, secure, as well as anonymous.
There are so many forms of cryptocurrency in the market such as Libra, Bitcoin, Ethereum, Litecoin, and Ripple, but “Bitcoin” is one of the most famous cryptocurrencies founded by Mr. Satoshi Nakamoto in the year of 2009.
History of Cryptocurrency
Former Finance Minister, Mr. Arun Jaitley said in the budget speech of 2018 that the government doesn’t consider cryptocurrencies as a legal tender.
In 2018, RBI banned all the functions and entities which is related to the sale and purchase of cryptocurrencies. In July 2019, the Inter-ministerial panel recommends completing the ban on all cryptocurrencies. and also said to implement new rules to fines and punishments for violation of its.
As per the Cryptocurrency and Regulation of the official Digital Currency Bill, 2021, the Indian Government wants to create an official digital currency to be issued by the reserve banks of India and it also prohibits all the other private cryptocurrencies in India.
Advantages Of Cryptocurrency
- As compared to our conventional currencies, the transactions of cryptocurrency are quicker, safer as well as cost-effective.
- The technology that is used in cryptocurrencies is fully encrypted, which makes the personal data of its users anonymous. and It also protects the user from cybercrime and fraud along with maintaining privacy.
- There are low transaction fees because miners of cryptocurrency are simply rewarded some amount of cryptocurrency from the network itself. so there are no fees or typically little fees for core transactions.
- You can only access your own part of the cryptocurrency via a digital key.
- Cryptocurrency is used as a Free flow and Global reach-Cross border Accessibility.
- The Counterfeiting of Cryptocurrency is also very tough.
- Cryptocurrency can be used as a key technology to strengthen the financial system.
- It’s also helpful for a country that has a weak economy.
Disadvantages of Cryptocurrency
- As the transactions are anonymous, some persons may be used cryptocurrencies for illegal activities like selling drugs, weapons, child pornography, etc.
- There is no central agency for regulating the transactions of Cryptocurrency, So, it makes it harder for RBI as well as the government to manage the monetary policy.
- Transaction of cryptocurrency can be done only through the internet. But uneducated people and people who do not have proper internet facilities will not be able to take advantage of it.
- The rates of Cryptocurrency are very volatile, which can cause huge losses or benefits in a very short time. Due to this, speculation or betting can also be promoted.
- Cryptocurrency can also prove to be a threat to official currency and monetary systems.
- People can also use cryptocurrency to Avoidance of Tax compliances.
Future Of Cryptocurrency
- If work is done to overcome the shortcomings of cryptocurrency, hence, it can complete in the banking sector.
- Many people are investing in cryptocurrencies to become rich- not for the intended purpose of easier money transactions -As a result, it may disappear after some time.
- Blockchain technology – every transaction is connected – can take steps on money laundering by implementing it in the banking sector.
What are the uses of Cryptocurrency?
- Purchase of products and services which accept cryptocurrencies for transactions.
- For Money Transfers without any charges
- Get paid in cryptocurrency
- Investment opportunities
Conclusion (Essay On Cryptocurrency)
Despite all the risks, the encrypted technology in cryptocurrency can prove to be an asset for the financial marketplace. Most countries are opting for a regulation on cryptocurrency rather than banning it.
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