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Updated on: Monday, December 27, 2021, 01:29 PM IST

Cryptocurrency has the potential to become a legal tender of money in India, says Gaurav Sharma

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Money has always been an essential source of motivation for all, and ever since the strike of global pandemic and inflation, it has been observed that people around the world have become motivated to look for various sources to earn money.

One of the most prevalent sources people found during this period was to invest their money in ‘Cryptocurrency’. Initially, when ‘Bitcoin’ was introduced in the Indian market, the value of a single coin was 20 rupees, but with the rise in demand, and due to its number being stagnant, it can be valued today at approximately 35 lakhs.

Investing money in the financial markets was considered a rich man’s game in the masses, but after passing through the difficult phase of the COVID 19 pandemic, it has been observed that the markets have completely revolutionized as there has been a sudden rise in the number of youngsters investing in cryptocurrency like Bitcoin and Dogecoin, who otherwise did not show any interest in investing their money overall. It is believed that due to cryptocurrency having no government or financial body control, other than being a better source of investment, it helps maintain privacy as to how much funds are available with the investor.

One of the major reasons why people are investing in cryptocurrency is because it operates using a revolutionary technology called ‘blockchain’ which makes it possible to record and manage every transaction made across many computers, making it nearly impossible to commit fraud. Hence it's the security that truly maintains its validity and appeal. There is a huge possibility that soon there will be many other industries that will try and integrate blockchain into their mode of operation to make their work simpler.

When we look at cryptocurrency from a general perspective, many people have a misconception that cryptocurrency is limited to Bitcoin, Dogecoin, and a few other leading currencies which keep mentioned in the news, but statistically speaking it has been seen that there are more than 15,000 different cryptocurrencies which are traded regularly in public without even knowing about them.

There are cryptocurrencies like Flipkart’s Super Coins, Chingari app’s Gari and much such money replacing digital currency on applications where you can take any service you need by making a payment using their application-specific currency.

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When it comes to the traditional cryptocurrency we invest in and trade-in, there isn’t a definite way to be certain about the future of digital currency in India, as there have been contradictory statements made in the past from government authorities and other essential regulatory bodies. As in the year, 2018 the Reserve Bank of India had banned banks from entertaining transactions related to cryptocurrency, but in 2020 Supreme Court of India lifted the ban, and after which it was feasible for every citizen to invest their money, hold and trade in cryptocurrency.

There are many reasons which could even make people believe otherwise, like there being no stability in the amount as the currency’s value is completely dependent on how much demand it has in the public and this unconfined nature of cryptocurrency is what makes investing in them a risky business. In spite of these challenges, it has been observed that many applications are still working on developing and making it mandatory to use their own currency rather than directly opting to pay by using bank-provided services like UPI and bank transfer.

Looking at the current situation as to how various companies and brands are adapting to the use of digital currency, there has also been speculation that RBI is working on developing a wallet, through which it will be possible to save cryptocurrencies and exchange them for money when needed. If developments like these get a green signal from the government authorities, there is a huge possibility that the status of cryptocurrency will completely change in India and the prices are predicted to go to a skyrocketing high. This could make it possible to convert all the mined cryptocurrency into a legal tender of money in India.

The author of this article, Gaurav Sharma, is the founder of KCS Invest. The company, with two branches in Delhi and Mumbai, aims to showcase the true power of authentic financial investing in current times.

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Published on: Monday, December 27, 2021, 01:29 PM IST
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