Blockchain Technology: Prospects and Challenges

In news: Crypto Awareness Campaign


From UPSC perspective, the following things are important :

Prelims level: Cryptocurrency

Mains level: Issues with Cryptocurrency


The Investor Education and Protection Fund (IEPF) will launch an outreach programme soon to create awareness of cryptocurrencies.

What is Cryptocurrency?

  • A cryptocurrency is a digital asset stored on computerised databases.
  • These digital coins are recorded in digital ledgers using strong cryptography to keep them secure.
  • The ledgers are distributed globally, and each transaction made using cryptocurrencies are codified as blocks.
  • And multiple blocks linking each other forms a blockchain on the distributed ledger.
  • There are estimated to be more than 47 million cryptocurrency users around the world.
  • These cryptocurrencies are created through a process called mining.

Investor Education and Protection Fund (IEPF)

  • The Investor Education and Protection Fund (IEPF) is managed by the IEPF Authority, which was set up in 2016 under the provisions of Section 125 of the Companies Act, 2013.
  • The Authority is entrusted with promoting awareness among investors, makes refunds of shares, unclaimed dividends, matured deposits and debentures and so on to rightful claimants.
  • As for investment education, the idea is to reach out to household investors, housewives and professionals alike in rural and urban areas and teach them the basics.
  • Focus areas include primary and secondary capital markets, various saving instruments, the instruments for investment, making investors aware of dubious Ponzi and chit fund schemes and existing grievance redressal mechanisms, among other things.
  • Until the end of October, it had conducted more than 65,000 awareness programmes covering 30 lakh citizens.

Why is there a concern about cryptocurrency?

  • RBI caution: The Reserve Bank of India (RBI) has recommended framing legislation on the sector. It is of the view that cryptocurrencies should be prohibited.
  • Fiscal stability at stake: The crypto dilemma stems from concerns about the unregulated currency having a destabilising effect on the monetary and fiscal stability of a country.
  • Involved in unlawful activities: Further, crypto exchanges in India are being investigated for their alleged involvement in unlawful practices such as drug trafficking, money laundering, violating foreign exchange legislation and evasion of GST.
  • High volatility: Cryptocurrency investing can be a complex and risky endeavour as the category is extremely volatile and works round the clock.

Will an outreach programme help?

  • Regulation is must: Apart from the outreach programme, there has to be a regulatory mechanism for the crypto sector.
  • Messaging has to be right: If the government takes a heavy-handed approach and starts saying things like virtual currency is not legal in India that will not be entirely true.

Present regulation in India

  • RBI has banned banks and other regulated entities from supporting crypto transactions.
  • The Government has confirmed that expenditure incurred in mining cryptocurrency is considered capital expenditure and not a cost of acquisition.
  • Cryptocurrency and Regulation of Official Digital Currency Bill, 2021 was introduced by the Centre.

Way forward

  • Crypto assets are borderless and therefore, any legislation (for regulation or for banning) would require international collaboration to prevent regulatory arbitrage.
  • The collaboration must entail an evaluation of risks and benefits and the evolution of common taxonomy and standards.


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1 year ago

poloniex trade bot is one of the most popular American crypto exchanges. It offers a number of different trading options, including margin trading. You can also use the website’s trading bots to automate your trades. These systems allow you to trade crypto without having to manually enter orders.

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1 year ago

As the world of cryptocurrency continues to grow, so does the need for education and awareness. This is why many companies are launching crypto awareness campaigns to help individuals understand the potential benefits and risks of investing in cryptocurrencies.
One aspect of crypto trading that many people may not be aware of is automated trading. Automated trading involves using computer algorithms to buy and sell cryptocurrencies based on predetermined conditions. Trading systems analyze market data and make trades automatically, without the need for human intervention.
Automated trading can be a great option for those who are new to the market or those who don’t have the time to monitor the market 24/7. It can also help to eliminate emotion from trading decisions, which can sometimes lead to poor decision-making.
If you’re interested in learning more about automated trading in cryptocurrency, check out the link below. The article explains how automated trading systems work and the potential benefits and risks of using them. Here is the link


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