Is cryptocurrency going to ban in India: The central government is not in a mood to completely ban cryptocurrencies i.e. digital currency. The government will make new rules for the use of cryptocurrencies in the country. For this, the government can constitute a new panel of experts. Even before this, the government had constituted an expert panel. This panel has given its recommendations to the government. Let us tell you what is cryptocurrency and what are the rules and regulations regarding it in the country right now.
What are the recommendations of the Expert Committee?
The Central Government had constituted an expert committee under the chairmanship of former Finance Secretary Subhash Garg regarding cryptocurrencies. This committee in its recommendations in 2019 called for a complete ban on cryptocurrencies. The government believes that the recommendations of the committee headed by Subhash Garg have become obsolete. Now instead of a complete ban on cryptocurrencies, there is a need to make new rules.
What will the new committee do?
The new committee will explore the possibilities of increasing the technology of blockchain to be used in cryptocurrencies. Also, the committee will suggest ways to regulate crypto as a digital asset instead of a currency. This committee can also be asked to study the modalities of operation of the proposed digital rupee of the Reserve Bank of India (RBI). However, the proposal for the formation of a new committee is in the preliminary stage and a final decision has not been taken on it.
What are the preparations of the Finance Ministry?
The Finance Ministry is monitoring the growing number of cryptocurrency trading in the country. The Ministry is in touch with all stakeholders regarding the potential risks associated with cryptocurrencies. Recently, Minister of State for Finance Anurag Thakur had a meeting with people associated with the crypto and banking industry. Anurag Thakur had said that the names of the people to be included in the committee are being considered. The committee may also include representatives of opposition parties. His team can inform Finance Minister Nirmala Sitharaman about the development regarding cryptocurrency by the end of this month.
Government’s preparation for digital currency?
In order to make rules related to cryptocurrencies in the country, the government has prepared the Cryptocurrency and Regulation of Official Digital Currency Bill 2021. This bill was to be introduced in the budget session of Parliament, but due to some reasons, it has not been introduced yet. It is expected that this bill can be introduced in the upcoming monsoon session of Parliament. This draft bill has been prepared on the basis of the recommendations of the Garg Committee. The current bill makes it criminal to hold cryptocurrency assets in the country.
RBI’s preparation for digital currency?
On January 25 this year, RBI had issued a booklet regarding the payment system. It said that the RBI will explore the possibility of granting cryptocurrency status to the new digital currency or the digital version of the rupee. In the same year, it was said in the Lok Sabha Bulletin that the Cryptocurrency and Regulation of Official Digital Currency Bill 2021 would pave the way for India’s official digital currency. RBI will prepare the framework for this.
What is cryptocurrency?
Cryptocurrency is a type of virtual currency. It is also called digital currency. Transactions can also be done with cryptocurrencies like currencies like the dollar or rupee. There are currently more than 4 thousand cryptocurrencies in circulation in the world. Bitcoin is the most popular cryptocurrency among them. Every bitcoin transaction is recorded on a public list via the blockchain. Which is a record maintenance system done by different users in a decentralized manner.
Cryptocurrency rules in India
The circulation of cryptocurrencies in the country has increased rapidly, but there is no law or guidelines in the country regarding this. In 2018, RBI issued a circular regarding cryptocurrencies. In this, RBI had banned all financial institutions from providing services related to cryptocurrency. In February last year, the Supreme Court had set aside the ban imposed by the RBI. After the decision of the Supreme Court, trading in cryptocurrencies is happening in India. The government had also prepared a bill in 2019 to ban cryptocurrencies and make it criminal. However, this bill could not be introduced in Parliament.
History of cryptocurrency
- In 1983, American cryptographer David Cham was the first to create cryptographic electronic money called e-cash.
- It was implemented in 1995 through Digicash.
- A software was required to withdraw this first cryptographic electronic money in the form of notes from a bank. This software was completely encrypted. Encrypted-key means a special type of key was given to the recipient of cryptographic electronic money through software.
- Using this software, the issuing bank, government, or another third party could not track the transaction.
- In 1996, the US National Security Agency published a paper describing the cryptocurrency system.
- In 2009 a virtual creator named Satoshi Nakamoto created a cryptocurrency called bitcoin. It was only after this that cryptocurrencies gained popularity around the world.
How to buy cryptocurrency?
These can be purchased through the cryptocurrency exchange website. For this, one has to first register on the exchange. You can then buy units of cryptocurrency by paying through a bank account or credit card. The customer has to keep in mind the rules and regulations of his country. Different exchanges charge something in the form of commission. Customers can keep cryptocurrencies in an online wallet.
How is a cryptocurrency created?
Cryptocurrencies are created through mining. it is virtual mining wherein a totally complicated virtual puzzle needs to be solved to get cryptocurrency. fixing this puzzle requires your own algorithm (programming code) as well as a variety of computing power. So in idea, it could be said that each person can make cryptocurrency, but in exercise, it’s far very difficult to make it.
Famous cryptocurrencies apart from bitcoin
Ether: it is the second most popular cryptocurrency in the world. It became produced by way of Vitalik Buterin in 2015. He developed the blockchain platform called Ethereum. The platform isn’t always constrained to only virtual foreign money called Ether, however, others also can use it to create their very own applications that use Ethereum’s blockchain system.
Ripple: Ripple turned into evolved in 2021 with the aim of simplifying the procedure of transacting cash across the world. money transfer thru Ripple could be very rapid and its price is likewise very low. Ripple is controlled by means of an organization known as Ripple Labs, which owns 1/2 of all Ripple’s currencies.
Litecoin: Former Google employee Charlie Lee created Litecoin in 2011. The blockchain platform of Bitcoin itself was used in this work. The aim changed to create a lightweight currency, eliminating the substantial strength and complexity that goes into constructing and preserving bitcoin.
Neo: is a Chinese language-made cryptocurrency, created by using Da Hongfei in 2014. to start with it become named Entshares which turned into changed to Neo in June 2017. it is also known as ‘Chinese Ethereum’ because of its similarity to Ethereum.