Cryptocurrencies, also known as digital or cryptocurrencies, are a globally decentralized payment platform used by each user. The Finance minister also said that new rules were in place, including fines and penalties for violating him.
According to the cryptocurrencies and regulations of the Official Digital Currency Bill of 2021, the Government of India wants to create an official digital currency issued by the Reserve Bank of India and also bans all other private cryptocurrencies in India to buy crypto with credit card
Benefits of cryptocurrencies
Cryptocurrencies are faster, safer, and more profitable than our traditional currencies. The technology used in cryptocurrencies is fully encrypted and your data is anonymous. It also protects users from cybercrime, fraud, and maintains privacy. Cryptocurrency miners only receive a certain amount of cryptocurrency from the network itself, so transaction fees are low. Therefore, there are no fees for large transactions. There is usually a small fee. You can only access your part of the cryptocurrency through a digital key. Cryptocurrencies are used for global reach, free flow and cross-border accessibility. Forgery of cryptocurrencies is also very difficult. Cryptocurrencies can be used as an important technology to strengthen the financial system. It is also useful for countries with weak economies. Disadvantages of cryptocurrencies
Because transactions are anonymous, some people use cryptocurrencies for illegal activities such as selling drugs, weapons, and child pornography. The lack of a central authority to regulate cryptocurrency transactions makes it more difficult for RBIs and governments to control monetary policy. Cryptocurrency transactions can only be performed via the internet. However, those who are not educated or who do not have the proper internet facilities cannot benefit from it. Cryptocurrency rates are very volatile and can lead to huge losses or profits in a very short amount of time. As a result, speculation and gambling can also be promoted. Cryptocurrencies can also pose a threat to official currencies and monetary systems. People can also use cryptocurrencies to circumvent tax compliance. The future of cryptocurrencies
If you work to overcome the shortcomings of cryptocurrencies, cryptocurrencies are encrypted digital currencies that are processed and verified by data mining. The term has gained a lot of popularity lately and is stronger at 400% of its initial value.
The process of using cryptocurrencies for transactions is complex. There is no third party involved between the two people doing the transaction. Once the request is generated, minors need to resolve complex issues. The transaction is then approved and kept in the public ledger. A public ledger is like a repository that holds all confirmed transactions. The identity of the individual is kept secret.
Recently, the RBI issued guidelines for banks and non-bank financial institutions (NBFI), stating that all entities that trade cryptocurrencies should be removed. This may allow funds to be directed to fraudulent activities such as terrorist activity and money laundering. However, the RBI did not completely ban cryptocurrencies.
Despite all the risks, cryptocurrency cryptography can become an asset in financial markets. Most countries choose to regulate cryptocurrencies rather than ban them.
If India also regulates these cryptocurrencies and invests in DLS technology, it will prove good in the future. “Digital Rupee” (INR) may be the solution for the future.