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Essay on Cryptocurrency in India
Cryptocurrency Meaning
A Cryptocurrency is a virtual/digital currency. Cryptocurrency transactions are verified and its records are managed and maintained by a decentralised authority also known as blockchain technology. And it uses cryptography technology.
Cryptocurrency is based on blockchain technology. Distributed Ledger System (D.L.S) technology is used in Cryptocurrency transactions which makes it encrypted, safe, secure and anonymous.
There are a lot of Cryptocurrencies in the market.
Some popular Cryptocurrencies are ;
Bitcoin, Libra, Litecoin, Ripple, Iota, Cardano, Dogecoin, etc. But Bitcoin outstands them all.
Bitcoin is the first Cryptocurrency. It was launched on 3 January, 2009 by unknown man, men by the pseudonym "Satoshi Nakamoto" As of January 202, there are 18.89 million Bitcoins in the market worth 670.96 B USD (mkt cap).
Now let's discuss,
Advantages and disadvantages of Cryptocurrency
Advantages of Cryptocurrency
- Decentralised: Cryptocurrencies are decentralised. It means no body controls Cryptocurrencies. Cryptocurrency transactions are secure and fully encrypted.
- Cheap and quick: Cryptocurrency transactions are cheaper, safe and cost effective than traditional currencies.
- Cross-border Transactions: National borders are not a barrier to Cryptocurrency transactions. We can transfer coins to anyone anywhere in the world without any problem.
- No Transaction Fee: Since miners of Cryptocurrencies are given some share of Cryptocurrency commission from the network itself, we do not need pay transaction fee in such virtual currencies.
- Digital Wallet: Cryptocurrency wallet is accessible only via Private Digital Key. And it makes it secure, encrypted, and private.
- No Duplication: Cryptocurrencies can not be counterfeited.
Disadvantages of Cryptocurrency
- Since the Cryptocurrency transactions are end to end encrypted and anonymous, some individuals may use it for illegal purposes, such as gambling, buying weapons, drugs, buying illegal things, trading illegally, etc.
- As a virtual currency, such currencies will be subject to cybersecurity issues. Cryptocurrencies may fall into the hands of hackers.
- Price volatility of Cryptocurrency is a major drawback of it. Its value may go up or down anytime. That is why Warren Buffett, one of richest persons in the world, referred the Cryptocurrency ecosystem as bubble.
- Cryptocurrency ecosystems lacks the system of regulations and control.
Uses of Cryptocurrency
- Cryptocurrency is used as a medium of payment. Unlike conventional currencies, Cryptocurrency transactions can be done via online.
- Another use of Cryptocurrency is opportunity for investment. Many people are investing their money in different Cryptocurrencies especially in the Bitcoin.
- Cryptocurrency can be used to make purchases. Since it is in its initial phase, it is not quite popular method of payment yet.
- Cryptocurrency may replace current monetary system in future.
Cryptocurrency Future in India
- The advancement and evolution of new financial and crypto technologies are expanding dramatically. It may transform the way we make transactions and buy stuff in future.
- Avivah Litan, one of the famous analysts, predicted that Cryptocurrencies will be used for retail payments in upcoming years.
- The central government of India is planning to pass a bill to ban all private Cryptocurrencies. But it also revealed that it is going to launch its own official digital Cryptocurrency.
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Essay on Cryptocurrency in India, Pros and Cons of Cryptocurrency Essay
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