12 Feb Cryptocurrency
What is cryptocurrency
- It is a digital currency in the form of a code, sender and receivers identity can be hidden even a probe can’t through light on identities
- Bitcoin is a cryptocurrency which is works on blockchain technology
- Blockchain technology is a decentralised distributed ledger. When anyone holding the bitcoin sells his coin to others and a new code will generate which will enter automatically to the ledger with a link to the previous code. These codes are in the form of a block, that’s why it is known as the blockchain.
Why in news
- Recently Bitcoin hit at the highest.
- The Indian government has completely banned the trading of Bitcoin in India
- Terror funding
- No authenticity (The person who made the coin still unknown to people.)
- It may crash in future which will hurt the small investors.
- Very difficult to monitor so the government loses revenue when someone gets a huge gain.
- What should be the wayforward
- Given the lure of bitcoin, it can be anticipated that in future bitcoin demand will increase, so people will trade in illegal ways.
- Rather than a blanket ban the government should regulate the trading so that terror funding can be curbed, tax can also be levied.