{"id":85303,"date":"2019-07-29T15:04:06","date_gmt":"2019-07-29T09:34:06","guid":{"rendered":"http:\/\/factly.forumias.com\/?p=8575"},"modified":"2019-07-29T15:04:06","modified_gmt":"2019-07-29T09:34:06","slug":"understanding-cryptocurrencies-whats-to-like-and-whats-to-fear","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/understanding-cryptocurrencies-whats-to-like-and-whats-to-fear\/","title":{"rendered":"Understanding cryptocurrencies: What\u2019s to like, and what\u2019s to fear"},"content":{"rendered":"\n
  1. An\ninter-ministerial committee (IMC) that was set up to assess the viability of\nvirtual currencies has recommended that India should ban private\ncryptocurrencies such as Bitcoin.<\/li>
  2. A\ncryptocurrency is a subset of virtual currencies. It is decentralised, and\nprotected by cryptography. Example: Bitcoin, Etherum, etc.<\/li>
  3. A\nvirtual currency is a digital representation of value that can be digitally\ntraded. It functions as (a) a medium of exchange, and\/ or (b) a unit of\naccount, and\/or (c) a store of value. However, unlike fiat currency like the\nrupee, it is not legal tender and does not have the backing of a government.<\/li>
  4. All\nvirtual currencies use Distributed Ledger Technology (DLT). It refers to\ntechnologies that involve the use of independent computers (also referred to as\nnodes) to record, share, and synchronise transactions in their respective\nelectronic ledgers. Unlike traditional ledger, data in DLT is not centralised.<\/li>
  5. Cryptocurrency\nlike Bitcoin uses Blockchain technology- a special kind of DLT. A Blockchain is\na digital, immutable, distributed ledger that chronologically records\ntransactions in near real time.<\/li>
  6. Internationally,\nthe application of DLT is being explored in the areas of trade finance,\nmortgage loan applications, digital identity management or KYC requirements,\ncross-border fund transfers and clearing and settlement systems.<\/li>
  7. The\ninter-ministerial committee (IMC) has recognised the potential of DLT and\nBlockchain. It has recommended the Department of Economic Affairs to take\nnecessary measures to facilitate the use of DLT in the entire financial field\nafter identifying its uses.<\/li>
  8. Further,\nit has also recommended that that regulators \u2014 RBI, SEBI, IRDA, PFRDA, and IBBI\nshould explore evolving appropriate regulations for development of DLT in their\nrespective areas.<\/li>
  9. However,\nit has called for a ban on private cryptocurrencies. It also noted that the RBI\nAct has the enabling provisions to permit the central government to approve a\n\u201cCentral Bank Digital Currency\u201d (CBDC) as legal tender in India.<\/li>
  10. The\nIMC has highlighted a number of concerns regarding private cryptocurrencies.\nThese are: a) non-official virtual currencies can be used to defraud consumers,\nb) scaling up such a currency system over a large population would exploits\nhuge levels of energy resources, c) the RBI would lose control over the\nmonetary policy and financial stability as it would not be able to keep a tab\non the money supply in the economy, d) anonymity of private digital currencies\nmake them vulnerable to money laundering and use in terrorist financing\nactivities, e) there is no grievance redressal mechanism in such a system, f) transactions\nare irreversible in such a system. <\/li><\/ol>\n","protected":false},"excerpt":{"rendered":"

    An inter-ministerial committee (IMC) that was set up to assess the viability of virtual currencies has recommended that India should ban private cryptocurrencies such as Bitcoin. A cryptocurrency is a subset of virtual currencies. It is decentralised, and protected by cryptography. Example: Bitcoin, Etherum, etc. A virtual currency is a digital representation of value that… Continue reading Understanding cryptocurrencies: What\u2019s to like, and what\u2019s to fear<\/span><\/a><\/p>\n","protected":false},"author":61,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[1738],"tags":[2498],"class_list":["post-85303","post","type-post","status-publish","format-standard","hentry","category-science-and-technology-daily-factly-articles","tag-cryptocurrency","entry"],"jetpack_featured_media_url":"","views":{"total":0,"cached_at":1700799844,"cached_date":1704892822},"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/85303","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/61"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=85303"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/85303\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=85303"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=85303"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=85303"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}