Cryptocurrency!_Blog 2_ The Way Forward...

  

Indian Finance Minister Mrs. Nirmala Sitharaman on February 1st 2022 presented annual budget 22-23 the basic framework for which has been 'Digitalization.' It emphasizes on 5G, digitalization in education and most importantly RBI's digital currency to come into picture. With 'The cryptocurrency and regulation of official digital currency bill' still pending on list of Parliament discussions, it creates state of dilemma in a country which has the highest number of Crypto owners in the world. In India about 100 million people have already invested in cryptocurrencies which is about 7.30 % of its total population, most of the investors being youths.

     In such a case it is really important for citizens to understand the system and government's stand. Cryptocurrency is just a fresher yet still it is belief of many that it would replace the fiat currency and upturn the global economy. But it is must understand the different countries worldwide are taking different stands about Crypto and nothing can be generalized.

   Where a country in Central America named El Salvador has given Bitcoin the status of legal tender, i.e., it can be used everywhere, for every transaction throughout the country. On the other hand, one of the most dominant economy worldwide China has completely banned Financial Institutions and companies from Crypto transactions and even mining.
   While the leading economy is like U.S, Japan and UK have cryptocurrencies legal but not as a legal tender. Most of the governments fear losing control over monetary policies and thus do not accept cryptocurrencies as legal tender. Also when we think about Crypto it is a complex topic and almost unaccessible to poor and not-so-well off sections of the society. In a country like India with so much poverty and illiteracy, cryptocurrencies are much a part of debate. But at the same time the fact that India's population which has the highest crypto investors across the globe, who have already invested in cryptocurrency. The government cannot think unlaterally.       
      

      The initiation goes with RBI banning cryptocurrency in 2018 stating that it would destabilized the economy, however the supreme court lifted the ban on cryptocurrency in 2020. In the year 2021 or fresh draft for regulation of cryptocurrency in India came into picture which initiated at regulating and not completely banning Crypto. Alongside the issuance of digital currency by RBI has been proposed. Moreover the government in the annual budget plan implied 30% tax on cryptocurrency.
       It is a matter to note that Indian government this year has not implied any particulars initiating cryptocurrencies. People often correlate cryptocurrency with RBI issued digital currency that is proposed in budget and would soon be coming to picture. With the basic understanding needed is that the cryptocurrency is solely a digital medium of exchange which is the decentralised and not under the control of government, but when we talk about RBI's digital currency or the digital rupee it would not fulfill the criteria. Thus, it is necessary to understand that though in India Crypto is accepted as a digital asset it is neither legal tender nor is completely banned by government. Recently the RBI government Shaktikanta Das stated that, 'Cryptocurrency has no underlying assets not even a Tulip...' and also warned people to invest at their own risk.
     

   Cryptocurrency is believed to be a way forward for a global economy  undoing all the borders. It would generate high skill employment and promote entrepreneurs. It would make the transactions transparent and if it is accepted worldwide it would no doubt upturn the entire economy.
       Flipping back the coin the value of cryptocurrencies is highly volatile and being decentralized cannot be assured of. Only the well-to-do sections of the society have the awareness and the accessibility over it. Also once in to picture it would reduce the values of national currencies demonetizing national economic and increasing income disparities.
       Hence, Cryptocurrencies are a step towards revolution which should empower democracies and not undetermine them. Regulated and stabilized cryptocurrencies would be the way forward to global economy, global trade fostering globalisation in every aspect. Different countries with different circumstances should work hand-in-hand neither banning nor completely authorising but regulating crypto, thinking of every aspect of society. Then it won't hurt much to say when asked, 'what after internet Revolution...?'  it definitely is "Cryptocurrency.."