Blockchain Technology: Prospects and Challenges

Blockchain Technology: Prospects and Challenges

Carbon footprint of Bitcoins


From UPSC perspective, the following things are important :

Prelims level : Bitcoins

Mains level : Feasiblity of Bitcoins as currency

At a time when investors around the world are scrambling to follow the newest financial trend, very few are bothered about the carbon footprint that the cryptocurrency is leaving behind.

If Bitcoin were a country, it would consume more electricity than Austria or Bangladesh!

Footprint of Bitcoins

  • T A recent study by Alex de Vries, a Dutch economist, has shown that Bitcoins leave behind a carbon footprint of 38.10 Mt a year.
  • The annual carbon footprint of Bitcoins is almost equivalent to that of Mumbai, or to put it to a global perspective, as high as the carbon footprint of Slovakia.
  • A recent study has shown that Bitcoins leave behind a carbon footprint of 38.10 Mt a year.
  • According to a study titled ‘CO2 Emissions from Fuel Combustion (Highlights) 2017’, Mumbai’s yearly carbon footprint stands at 32 Mt, while Bangalore’s is at 21.60 Mt.
  • Vries has been able to create a Bitcoin Energy Consumption Index, one of the first systematic attempts to estimate the energy use of the bitcoin network.

Relation between creating bitcoins and electricity required

  • Bitcoins are created by “mining” coins, for which high-tech computers are used for long hours to do complex calculations.
  • The more coins there are in the market, the longer it takes to “mine” a new one and in the process, more electricity is consumed.
  • As mining provides a solid source of revenue, people are willing to run power-hungry machines for hours to get a piece.
  • In 2017, the Bitcoin network consumed 30 terawatt-hours (TWh) of electricity a year.
  • As such, each bitcoin transaction roughly requires an average of 300kg of carbon dioxide – which is equivalent to the carbon footprint produced by 750,000 credit cards swiped.

Calculating the carbon footprint

  • The major problem with mining Bitcoin is not its massive energy-consumption nature; it is the fact that most of the mining facilities are located in regions that rely heavily on coal-based power.
  • Earlier, determining the carbon impact of the Bitcoin network was difficult as tracking down miners was never easy.
  • As per the estimates of De Vries, roughly 60% of the costs of bitcoin mining is the price of the electricity used.
  • The price of a Bitcoin stood at $42,000 and at this rate; miners would be earning around $15 billion annually.

Other impacts of Bitcoin mining

  • The effects of cryptocurrency mining often spill over to other parts of the economy.
  • With miners using high-tech computers for hours to formulate new blockchains, these machines do not last long.
  • Manufacturers of Bitcoin mining devices need a substantial number of chips to produce these machines and recently, during the Covid-19 crisis, the world had witnessed a shortage of these chips.
  • This shortage, now, in turn, started affecting the production of electric vehicles around the world.

What can be done to control the carbon footprint?

  • The Dutch economist asks policymakers to follow the path shown by Québec in Canada, where a moratorium on new mining operations has been imposed.
  • Although Bitcoin might be a decentralized currency, many aspects of the ecosystem surrounding it are not.
  • Large-scale miners can easily be targeted with higher electricity rates, moratoria, or, in the most extreme case, confiscation of the equipment used.
  • Governments can also ban cryptocurrencies from digital asset marketplaces as it will affect the prices of a digital currency.

India and the cryptocurrency

  • The country, at present, has around 75 lakh cryptocurrency investors who have together pooled over Rs 10,000 crore into Bitcoins and other such digital currencies.
  • The prices have surged by over 900%, courtesy of the worldwide boom – a single bitcoin that used to cost around Rs 4 lakh in 2020 now costs somewhere around Rs 41 lakh now.
  • FM Nirmala Sitharaman has said that the Centre will take a “calibrated approach” and leave a window open for experiments with blockchain technology.

By Explains

Explain the News

Blockchain Technology: Prospects and Challenges

Regulate but do no ban Bitcoin


From UPSC perspective, the following things are important :

Prelims level : Blockchain

Mains level : Paper 3- Implications of banning blockchain technology

The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021 seeks to ban cryptocurrencies. Banning cryptocurrencies would have several implications for India. This article deals with this issue.

Soaring value of Bitcoin

  • Recently, Tesla announced that it will soon accept cryptocurrency as legitimate payment for its cars.
  • Mastercard followed by announcing that it will incorporate ‘select cryptocurrencies’ on its global payment network.
  • BNY Mellon, incidentally the US’s oldest bank, announced holding and transferring digital currencies for asset management clients.
  • JP Morgan and Goldman Sachs announced executive positions to look at cryptocurrencies.
  • All of this resulted in a soaring value of Bitcoin, and its younger sibling, Ethereum.

India’s governments stand on cryptocurrencies

  • India’s government sought to ban cryptocurrency through a proposed legislation, the Cryptocurrency and Regulation of Official Digital Currency Bill, 2021.
  • The Bill also provides to also set up a legal structure for an “official digital currency”.
  • The Bill promises to “allow for certain exceptions to promote the underlying technology of cryptocurrency (blockchain) and its uses.”
  • The way the technology is built, an ownerless, consensus-driven, distributed ledger like a blockchain needs cryptocurrency to grease its wheels.
  • India tried to ban cryptocurrency once before, in 2018, before it was reversed by the Supreme Court.

Implications of banning cryptocurrencies

  • The banning will kill innovation.
  • India has more than 30,000 blockchain innovators and practitioners.
  • These innovators will now be looking at moving out to friendlier regimes like the US, Switzerland, Singapore and Estonia.
  • International tech companies will freeze blockchain and crypto-exchange investments in India and the step will undermine India’s reputation as a technology hub.
  • India is the second-largest Bitcoin trading nation in Asia, and all those trades will move to overseas exchanges.
  • China has large crypto trading and mining operations, and an Indian ban on Bitcoin will leave that space open for it.

Consider the question “What is cryptocurrency? What would be the implications of banning it?”


No doubt, there are many problems with cryptocurrency—it is volatile, sucks energy, and is often abused by criminals. But the answer is not to ban it, but regulate it.


By Explains

Explain the News

Blockchain Technology: Prospects and Challenges

Cryptocurrency and Regulation of Official Digital Currency Bill, 2021


From UPSC perspective, the following things are important :

Prelims level : Cryptocurrency, Blockchain technology

Mains level : Digital Currency

With the likely scenario of India’s government banning private cryptocurrencies, the Reserve Bank of India (RBI) is planning to introduce an official digital currency for the country.

What is the news?

  • An earlier government bill on cryptocurrency in 2019 reportedly sought to ban cryptocurrency and criminalise its possession in India. However, it was not introduced in Parliament.
  • The detailed text of the bill has not been released in the public domain so far.
  • The bill also says that there will be a regulation to help RBI create its own CBDC (central bank digital currency).

What are Cryptocurrencies?

  • A cryptocurrency is a digital asset designed to work as a medium of exchange wherein individual coin ownership records are stored in a ledger existing in a form of a computerized database.
  • It uses strong cryptography to secure transaction records, to control the creation of additional coins, and to verify the transfer of coin ownership.
  • It typically does not exist in physical form (like paper money) and is typically not issued by a central authority.
  • Cryptocurrencies typically use decentralized control as opposed to centralized digital currency and central banking systems.

Hues over the Bill

  • The past year has seen a surge in the number of cryptocurrency investors in India and in trading volumes.
  • Cryptocurrency exchanges such as CoinDCX and Coinswitch Kuber have also raised early-stage funding for their operations.
  • The bill may spark an end to the nascent cryptocurrency industry in the country.

What were the provisions of 2019 Bill?

Definition of cryptocurrencies:

  • The 2019 Bill defined cryptocurrency as any information, code, number or token, generated through cryptographic means or otherwise, which has a digital representation of value and has utility in business activity, or acts as a store of value or a unit of account.


  • The 2019 Bill bans the use of cryptocurrency as legal tender or currency.
  • It also prohibits mining, buying, holding, selling, dealing in, issuance, disposal or use of cryptocurrency.
  • Mining is an activity aimed at creating a cryptocurrency and/or validating cryptocurrency transactions between a buyer and a seller.

In particular, the use of cryptocurrency was prohibited for:

  1. use as a medium of exchange, store of value or unit of account,
  2. use as a payment system,
  3. providing services such as registering, trading, selling or clearing of cryptocurrency to individuals,
  4. trading it with other currencies,
  5. issuing financial products related to it,
  6. using it as a basis of credit,
  7. issuing it as a means of raising funds, and
  8. issuing it as a means for investment.

Why the govt wants to ban cryptocurrencies?

Sovereign guarantee

  • Cryptocurrencies pose risks to consumers.  They do not have any sovereign guarantee and hence are not legal tender.

Market volatility

  • Their speculative nature also makes them highly volatile.  For instance, the value of Bitcoin fell from USD 20,000 in December 2017 to USD 3,800 in November 2018.

Risk in security

  • A user loses access to their cryptocurrency if they lose their private key (unlike traditional digital banking accounts, this password cannot be reset).

Malware threats

  • In some cases, these private keys are stored by technical service providers (cryptocurrency exchanges or wallets), which are prone to malware or hacking.

Money laundering

  • Cryptocurrencies are more vulnerable to criminal activity and money laundering.  They provide greater anonymity than other payment methods since the public keys engaging in a transaction cannot be directly linked to an individual.

Regulatory bypass

  • A central bank cannot regulate the supply of cryptocurrencies in the economy.  This could pose a risk to the financial stability of the country if their use becomes widespread.

Power consumption

  • Since validating transactions is energy-intensive, it may have adverse consequences for the country’s energy security (the total electricity use of bitcoin mining, in 2018, was equivalent to that of mid-sized economies such as Switzerland).

By Explains

Explain the News

Blockchain Technology: Prospects and Challenges

Private: Use Blockchain Technology to improve governance

In India, present administrative affairs grapple with leakages in public delivery of welfare and development goals on account one critical problem- manual processes that can be very easily manipulated. These are often so complex and laborious that even a well-intentioned public servant is chary of implementing beneficial decisions. Technology can cut through much of these daunting processes.

What is Blockchain Technology?

  • Blockchain technology is a structure that stores transactional records (known as the block) of the public in several databases (known as the chain) in a network connectedthrough peer-to-peer nodes. This storage is referred to as a digital ledger.
  • The three key principles of blockchain technology are transparency, decentralisation and accountability.

How can India utilize Blockchain Technology?

  • In the next decade, the business of Indian government is going to experience massive disruptions. This comes on the back of technological enhancements that reduce the need for intermediaries and ensure that the sanctity of process remains unimpeachable.
  • NITI Aayog identified use-cases where the technology can potentially improve governance ranging from tracing of drugs in the pharmaceutical supply chain to verification of education certificates.
  • One of the most productive areas of intervention for blockchain technology would be in land records.
  • A vast developing country like India, with its diverse land tenure systems, is bound to have major problems in this area.  The system is riddled with inefficiencies that reduce trust in the government.
  • Currently the United Nations Development Programme is involved in Proof of Concept pilots across India. Through this technology;
    • create an immutable history of transactional records that helps in checking authenticity;
    • create a tamper-proof system to avoid forgery;
    • create a distributed ledger so that all stakeholders see the same information and set up a secure encrypted environment, where updates are available in near real time.
  • The NITI Aayog notes that, in order to ensure that transactions are not fraudulent, the physical presence of witnesses is mandated at the time of sales deed registry.
  • Deployment of blockchain would potentially eliminate the need of these processes while maintaining the sanctity of the transaction.
  • Blockchain helps create a tamper-proof audit trail that allows for tracking decision-making and ensures that such decisions are in accordance with anti-corruption principles.
  • It addresses concerns around cyber security that come with any effort towards digitisation. Currently there are interesting pilots being conducted across the world, where deployment of blockchain is being tested for public procurement.
  • From the perspective of Internal Controls and Governance (Vigilance), blockchain is strongly recommended to employ a five-part test while assessing such deviations from process:
    1. Whether the issue being pursued has corruption connotations;
    2. The general reputation of the employee involved;
    3. Whether better options were available and ignored without valid reasoning;
    4. Whether the situation inhibited the selection of any other option but the one finally chosen;
    5. Whether the larger interest of the organisation was safeguarded.
  • However, a significant factor in blockchain’s success will be the ability to develop/reform laws and building robust data protection and maintenance regimes.
  • The general environment now is in favour of a regime which ensures that companies not only do profitable business but do so in an ethical manner.

Government Efforts:

  • The enactment of the Public Procurement Bill, Lokpal Act incorporating, inter alia, the disclosure of assets by public servants and reforms in higher judicial appointments to name a few.
  • The government launched the Government e-Marketplace (GeM) in 2016 for goods and services required by central and state governments, and public sector undertakings.
  • The price reduction of approximately 56% of goods and services coupled with demand aggregation has led to savings of ₹40,000 crores annually.
  • The government made a significant change to the Prevention of Corruption Act in 2018. In the earlier regime, even honest public officials were harassed if a decision provided pecuniary advantage to a person without any public interest.
  • The element of intention has been added under the definition of criminal misconduct. Similarly, broadening the definition of “unfair advantage” and the introduction of corporate criminal liability will go a long way in apprehending or deterring those indulging in bribery.
  • United Nations Convention against Corruption ratified by India in 2011 as well as the anti-corruption principles of the Organization for Economic Cooperation & Development (OECD) cover a wide swathe of vulnerable areas and aspects of business operations including anti-bribery, public procurement and conflict of interest.


  • The problem of corruption in the social and political spheres has often come in for strident criticism.
  • It can be argued that corruption in public life, directly or indirectly, adversely affects the achievement of United Nation (UN)’s sustainable development goals (SDGs).
  • Governments are expectedly risk-averse in dealing with both public policies and public money while enterprises thrive on risk-taking. This often hobbles the entrepreneurial spirit in the public sector.
  • The public procurement economy in India constitutes about 20% of the Gross Domestic Product (GDP), it is imperative to build on this initiative with a view to onboard as many goods and services as possible.


  • In the recent discourse on procurement methods, transparency of policy, procedure and practices is increasingly being seen as an imperative when utilising public money.
  • However, transparency is not an end in itself. The whole process must be open to public scrutiny.
  • It is important to institutionalise a system where compliance and established processes can be routinely checked and quantified.
  • A metrics-based system for oversight in governmental processes will bring about transparency, build trust with citizens and spur further digital innovation to make any administration more robust.
  • It is only through robust yet streamlined procedures that a bureaucrat can achieve the intended outcome and avoid unintended consequences.
  • India must focus on the well-intentioned public servant who finds the processes leading to greater transparency and ensuring value for taxpayers’ money cumbersome.


Blockchain is likely to have a significant impact in creating an integrity-first governance ecosystem. India needs to review existing legal frameworks to address issues around, inter alia, data security, corrupt practices and corporate governance with a view to address anti-corruption objectives.

By Explains

Explain the News

Blockchain Technology: Prospects and Challenges

Private: Blockchain Technology and COVID-19


The coronavirus has impacted countries, communities and individuals in countless ways, from school closures to health-care insurance issues, not to undermine loss of lives. As governments scramble to address these problems, different solutions based on blockchain technologies have sprung up to help deal with the worldwide crisis.


What is Blockchain Technology?

Simply, blockchain is decentralized, distributed and public digital ledger.  Blockchains is a new type of network infrastructure (a way to organize how information and value move around on the internet) that create ‘trust’ in networks by introducing distributed verifiability, auditability, and consensus.

Blockchains create trust by acting as a shared database, distributed across vast peer-to-peer networks that have no single point of failure and no single source of truth, implying that no individual entity can own a blockchain network, and no single entity can modify the data stored on it unilaterally without the consensus of its peers.

New data can be added to a blockchain only through agreement between the various nodes of the network, a mechanism known as distributed consensus. Each node of the network keeps its own copy of blockchain’s data and keeps the other nodes honest – if one node changes its local copy, the other nodes can reject it.

imagine a blockchain as a ledger—because that’s essentially how most blockchains function. Each block of data represents some new transaction on the ledger, whether that means a contract or a sale or whatever else you’d use a ledger for.

Interestingly, blockchains leverage techniques from a field of mathematics and computer science, known as cryptography, to sign every transaction (e.g. the transfer of assets from one person to another) with a unique digital signature belonging to the user who initiated the transaction.

Blockchains and Cryptocurrency – How it all began?

A cryptocurrency is a digital or virtual currency that uses cryptography for security.  The Bitcoin protocol is built on the blockchain.

  • Bitcoin is an example of electronic or digital currency that works on a peer-to-peer basis.
  • Bitcoins can be sent digitally to anyone who has a bitcoin address anywhere in the globe. One person could have multiple addresses for different purposes – personal, business and the like.
  • A bitcoin is not printed currency but is a non-repudiable record of every transaction that it has been through. All this is part of a huge ledger called the blockchain.

There’s also a new cryptocurrency called Libra rolled out by Facebook.

  • Initially, blockchain technology was linked to cryptocurrency only but today it’s application are widespread.

Various uses of Blockchain in fighting COVID-19

Blockchain could be used to improve a variety of healthcare-related processes, including record management, healthcare surveillance, tracking disease outbreaks, management crisis situations and many more.

1) Tracking Infectious Disease Outbreaks

  • Blockchain can be used for tracking public health data surveillance, particularly for infectious disease outbreaks such as COVID-19.
  • With increased blockchain transparency, it will result in more accurate reporting and efficient responses.
  • Blockchain can help develop treatments swiftly as they would allow for rapid processing of data, thus enabling early detection of symptoms before they spread to the level of epidemics.

2) Donations Tracking

  • As trust is one of the major issues in donations, Blockchain has a solution for this issue.
  • There has been a concern that the millions of dollars being donated for the public are not being put to use where needed.
  • With the help of blockchain capabilities, donors can see where funds are most urgently required and can track their donations until they are provided with verification that their contributions have been received to the victims.

3) Crisis Management

  • Blockchain could also manage a crisis situation. It could instantly alert the public about the Coronavirus by global institutes like the WHO using smart contractsconcept.
  • Not only it can alert, but Blockchain could also enable to provide governments with recommendations about how to contain the virus.
  • It could offer a secure platform where all the concerning authorities such as governments, medical professionals, media, health organizations, media, and others can update each other about the situation and prevent it from worsening further.

4) Securing Medical Supply Chains

  • Blockchain has already proven its success stories as a supply chain management tool in various industries; similarly, it could also be beneficial in tracking and tracing medical supply chains.
  • Blockchain-based platforms can be useful in reviewing, recording, and tracking of demand, supplies, and logistics of epidemic prevention materials.
  • As supply chains involve multiple parties, the entire process of record and verification is tamper-proof by every party, while also allowing anyone to track the process.

6) Education

  • ‘Certificates’ are a means of verifying the credentials of individuals across domains and geographies. A paper-based certification is fallible to manipulation and susceptible to fraud.
  • The blockchain-based SuperCert promises anti-fraud identity intelligence blockchain solution for educational certificates.
  • The immutability feature of blockchain ensures that tampering of certificate is not feasible – both the content of the certificate and the identity of the certificate holder.

7) Finance

  • Blockchain integration in financial transactions will not only save time and money, but it will also make the transaction processing and authentication process much more seamless.
  • Furthermore, Blockchain can be an excellent tool to monitor money laundering and black money accumulation – since all transactions are permanently stored on the Blockchain network, every transaction is accountable.
  • Blockchain is also capable of dealing with issues like double spending and unauthorized spending.
  • With Covid panic on use of cash currency, here one may find alternatives too.

Various Challenges in adopting Blockchains

Any transformative technology, in its initial stages of development, as it moves out of the research/development phase to first few applications to large scale deployment, faces several challenges.

  • There is no confidence in the technology: It is still an innovation. Building trust in the network represents a challenge for blockchain.
  • High costs and complexity of blockchain.
  • Lack of understanding comes next as many executives have a vague understanding of blockchain and the changes it will bring. Many still connect it only with cryptocurrencies management.
  • A general lack of standards is also a problem. Blockchain-specific vocabulary is insufficient; its terminology is both scarce and new.
  • A lack of general regulation is a problem. The Supreme Court of India has ruled against a decision imposed by the country’s central bank nearly two years ago that stifled crypto trading in Asia’s third-largest economy.
  • Vague data regulation in countries due to poor laws and policy is one more issue.
  • Lack of blockchain talent: Whenever a groundbreaking technology emerges, the developer community needs time and resources to accommodate the new demand.
  • Energy consumption The majority of blockchains present in the market consume a high amount of energy. It requires high amounts of computation power to solve a complex mathematical problem to verify and process transactions and to secure the network. Add to this the energy needed to cool down the computers, and the costs increase exponentially.

Blockchain: the India imperative

India has a unique strategy for the Government to take the lead in creating public digital infrastructure and allowing private sector innovation to leverage Blockchain for further development.

NITI Aayog has released recommendations to establish India as a vibrant blockchain ecosystem. The suggested recommendations include:

  • Regulatory and policy considerations for evolving a vibrant blockchain ecosystem
  • IndiaChain: Creation of a national infrastructure for the deployment of blockchain solutions with inbuilt fabric, identity platform and incentive platform
  • India as blockchain hub: promotion of research and development in blockchain, in addition, to focus on skilling of workforce and students
  • Procurement process for government agencies to adopt blockchain solutions
  • Cryptocurrencies for India: Pegged stable coin for Indian Rupee for seamless exchange for blockchain solutions. This may be in conjunction with the need for re-evaluating cryptocurrencies.

Way Forward

  • Although India is still at the nascent stage in exploring Blockchain technology, it holds is immense potential for Blockchain applications.
  • The key lies in overcoming the challenges faced during the early adoption phase – if we can get past the obstacles in the initial stage, Blockchain tech can be put to good use to strengthen the Indian economy.
  • The days of blockchain application have just begun and as with any new technology, blockchain will hit a few roadblocks especially with the government’s regulators across the globe.
  • As the true essence of blockchain application is to take the power away from the hands of the powerful by decentralizing information and handing it over to the people- democracy in true sense.
  • Nonetheless as with any movement, if people see the value the technology brings into their lives they will rally behind it and blockchain application will become mainstream in most industries in the coming years.


By providing help in the COVID-19 crisis and recovery, blockchain can play a pivotal role in accelerating post-crisis digital transformation initiatives and solving those problems highlighted in the current system.

However, at the present moment, blockchain is not the panacea of all the problems. While the promise and potential of blockchain are undoubtedly transformative, it is still in the nascence of its evolution.

Keeping a tab on this technology and our capacities is the right direction we can head towards.

By Explains

Explain the News

Blockchain Technology: Prospects and Challenges

E-Renminbi: China’s Official Digital Currency


From UPSC perspective, the following things are important :

Prelims level : e-RMB

Mains level : Cryptocurrency and its feasiblity

China in a significant move has launched a trial of digital yuan in four urban centres of the country for specific services even as the world grapples with the containment of Covid.

What is a cryptocurrency? Discuss how a vibrant cryptocurrency segment could add value to India’s financial sector. (250 W)

Prelims Perspective:-

1. Subtle differences btn digital and virtual currency – e.g. Regulatory issues

2. Which countries have official virtual currency – e.g. Petro of Venezuela


  • It will be the electronic form of the renminbi, with a value equivalent to the paper notes and coins in circulation.
  • The People’s Bank of China, the country’s central bank, will be the sole issuer of the digital yuan, initially offering the digital money to commercial banks and other operators.
  • It will be launched in major cities of Shenzhen, Suzhou and Chengdu, as well as the Xiong’an New Area.
  • It aims to change the financial system in big ways — by cutting costs and making transactions easier, more convenient and more transparent.
  • The public would be able to convert money in their bank accounts to the digital version and make deposits via electronic wallets.

Back2Basics: Cryptocurrency

  • A Cryptocurrency is an internet-based medium of exchange which uses cryptographical functions to conduct financial transactions.
  • It leverages blockchain technology to gain decentralization, transparency, and immutability.
  • The most important feature of a cryptocurrency is that it is not controlled by any central authority: the decentralized nature of the blockchain makes cryptocurrencies theoretically immune to the old ways of government control and interference.
  • It can be sent directly between two parties via the use of private and public keys.
  • Unlike decentralized cryptocurrencies, such as bitcoin, that allow users to transfer value with no central authority or third party involved, the government-backed digital currency is preferred.

What are Blockchains?

  • Blockchain, sometimes referred to as Distributed Ledger Technology (DLT), makes the history of any digital asset unalterable and transparent through the use of decentralization and cryptographic hashing.
  • Blockchain consists of three important concepts: blocks, nodes and miners.
  • Nodes can be any kind of electronic device that maintains copies of the blockchain and keeps the network functioning.
  • Miners create new blocks on the chain through a process called mining.

By Explains

Explain the News

Blockchain Technology: Prospects and Challenges

India can use Yes Bank debacle to chase China in Crypto


From UPSC perspective, the following things are important :

Prelims level : Not much.

Mains level : Paper 3- Is cryptocurrency solution to bad governance in the banking system in India?


There’s an opportunity to stabilize the financial system and prevent a rival power from widening its lead.

The backdrop of YES bank failure time for cryptocurrency

  • Perfect time for cryptocurrency: Confidence in the Indian financial system has been breaking down for some time. Instead of trying to restore trust, it may be time to require less of it — with the help of an official rupee cryptocurrency.
  • The last straw: The collapse of corporate lender Yes Bank Ltd. was the last straw, which failed in slow motion in full view of authorities.
    • Depositors have been assured that their $20 billion-plus in stuck funds will be released after a rescue by the government-controlled State Bank of India.
    • What could be the impact on the sentiment of the people? While that may help prevent widespread panic, even temporarily stopping people from accessing their funds would mean that from now on, not all savings and current accounts will be treated by individuals and businesses as a perfect substitute for cash.

Why it would be costly and difficult to revive the public faith?

  • It will be both difficult and costly to revive the public’s dwindling faith.
  • Nationalisation not an option: A nuclear option is to nationalize the banks and non-bank finance firms that provide $1.75 trillion in annual funding. Doing so would be a doomed throwback to the late 1960s when India lurched toward stultifying socialist-style state controls.
  • Corruption in banking won’t go away: Similarly, it would be unrealistic to assume that the Yes Bank embarrassment would trigger an improvement in the status quo.
    • Deep crony-capital relationship: The crony-capital relationships between financiers and borrowers in India are steeped in its colonial history.
    • Basel III won’t solve the problem: Putting on the gloss of Basel III capital requirements, which are supposed to make lenders less prone to failure, doesn’t make corruption in banking go away.

Can cryptocurrency be an answer?

  • It offers hope: Blockchain technology, which the Indian establishment is trying to snuff out in finance, offers hope. Government should consider official crypto to obviate the need for trusted intermediaries, which are in short supply, anyway.
  • China expected to launch digital currency: Before the coronavirus outbreak, China was widely expected to start its own central bank digital currency this year.
    • But India’s need is greater, and its motivation very different from Beijing’s desire to shake the hegemony of the dollar.
  • After the Yes Bank debacle and botched rescue, deposits in India will probably gravitate toward four or five large lenders, whose managers may be emboldened to make risky bets with other people’s money. The remaining banks will struggle for liquidity. A perennially unstable credit delivery network will always be one misstep away from the next blowup. While every country has its share of manias, panics and crashes, to be gripped by absolute financial mistrust every few years is not an environment where growth can flourish.
  • Opportunity to think afresh: Earlier this month, India’s highest court set aside the Reserve Bank of India’s directive that asked banks to not offer services to cryptocurrency traders and exchanges.
    • A legal defeat has provided the opportunity to think afresh.
    • But in parallel, the government is considering a blanket ban on private virtual tokens. The crypto activity could get slammed again.
  • Possibility of misuse: To be sure, one popular use of technology is money laundering.
    • But to kill the industry and send practitioners packing would be to lose out on a valuable innovation at a time when India needs to build on the globally recognized successes of its digital payments industry, which has gained users’ trust just as banks and shadow banks have lost it.

Implications for deposit in the aftermath of Yes bank debacle

  • Deposits may gravitate towards big banks: After the Yes Bank debacle and botched rescue, deposits in India will probably gravitate toward four or five large lenders, whose managers may be emboldened to make risky bets with other people’s money.
    • The remaining banks will struggle for liquidity.
  • Next blowup: A perennially unstable credit delivery network will always be one misstep away from the next blowup.
  • Impact on growth: While every country has its share of manias, panics and crashes, to be gripped by absolute financial mistrust every few years is not an environment where growth can flourish.

Possible pathways for central banks digital currency

  • Pathways suggested by BIS: After surveying 17 projects around the world — from Norway and Sweden to China, Cambodia and South Africa — the Bank for International Settlements (BIS) has identified four possible pathways for a central bank digital currency.
  • Starting point- Rupee token: Of the pathways suggested by the BIS, a rupee token that doesn’t require the holder to have an account with anyone but has value guaranteed by the Reserve Bank of India could be a starting point.
  • Who should enable the fund transfer? Cryptography (“I know a secret, therefore I own the funds”) rather than an account relationship (“I am who I say I am, therefore I own the funds”) would be used to enable transfers.
    • Later, the RBI can open up the validation of transactions to authorized parties on distributed ledgers.
  • What is the current system and issues with it? Currently, a deposit holder has to rely on everyone from the bank’s management and board to the auditors, the rating firms and the regulator to do their jobs.
    • When they all fail, as in the case of Yes, the bank’s chequebook, ATM card, and online banking password cease to generate liquidity.
    • Deposits stop being the same as cash, even if the state guarantees their safety.
    • It would be far less painful if deposit owners only had to trust the RBI, not as a banking regulator but as a money-printing authority that could never run out of resources to settle its IOUs.


  • China’s ambition challenge dollars position as a reserve currency: China wants the yuan to take over from the dollar as the world’s reserve currency. A tech-enabled global alternative to the greenback — of the kind that Facebook Inc.’s proposed Libra had threatened to be — would have been an obstacle. Hence, Beijing accelerated its tokenized currency initiative.
  • India should jump the bandwagon: India needs to jump on the bandwagon for self-preservation. If the RBI doesn’t make easy-to-transact digital rupees available and leaves ordinary folks at the mercy of poorly run and supervised banks like Yes, people would rather store their wealth in Silicon Valley-sponsored tokenized money — or Beijing’s digital yuan — whenever they arrive.

By Explains

Explain the News

Blockchain Technology: Prospects and Challenges

Supreme Court ruling on Virtual Currency


From UPSC perspective, the following things are important :

Prelims level : Virtual Currency, Cryptocurrency

Mains level : Issues with Blockchain Technology

The Supreme Court in a significant move has set aside a ban by the Reserve Bank of India (RBI) on banks and financial institutions from dealing with virtual currency holders and exchanges.

Why did the Supreme Court ban virtual currencies?

  • In a circular in 2018, the RBI had banned banks from dealing with virtual currency exchanges and individual holders on the grounds that these currencies had no underlying fiat.
  • RBI held that it was necessary for the larger public interest to stop banks from providing any services related to these.

Why was the ban unjustified?

  • The court held that the ban did not pass the “proportionality” test.
  • The test of proportionality of any action by the government, the court held, must pass the test of Article 19(1) (g) which states that all citizens of the country will have the right to practise any profession, or carry on any occupation or trade and business.

What are virtual currencies?

  • There is no globally accepted definition of what exactly is virtual currency.
  • Some agencies have called it a method of exchange of value; others have labelled it a goods item, product or commodity.
  • In its judgment the apex Court observed- Every court which attempted to fix the identity of virtual currencies, merely acted as the 4 blind men in the Anekantavada philosophy of Jainism, who attempt to describe an elephant but end up describing only one physical feature of the elephant.

Similarities with Bitcoin

  • Satoshi Nakamoto widely regarded as the founder of the modern virtual currency bitcoin and the underlying technology called blockchain defined bitcoins as “a new electronic cash system that’s fully peer-to-peer, with no trusted third party”.
  • This essentially meant there would be no central regulator for virtual currencies as they would be placed in a globally visible ledger, accessible to all the users of the technology.
  • All users of such virtual currencies would be able to see and keep track of the transactions taking place.

Are they different from cryptocurrencies?

  • Virtual currency is the larger umbrella term for all forms of non-fiat currency being traded online. Virtual currencies are mostly created, distributed and accepted in local virtual networks.
  • Cryptocurrencies, on the other hand, have an extra layer of security, in the form of encryption algorithms.
  • Cryptographic methods are used to make the currency as well as the network on which they are being traded, secure.
  • Most cryptocurrencies now operate on the blockchain or distributed ledger technology, which allows everyone on the network to keep track of the transactions occurring globally.

Are cryptocurrencies dangerous?

  • The jury is out on that. Organisations across the globe have called for caution while dealing with virtual currencies.
  • A blanket ban of any sort could push the entire system underground, which in turn would mean no regulation.
  • In June 2013, the RBI had for the first time warned users, holders and traders of virtual currencies about the potential financial, operational, legal and customer protection and security-related risks that they were exposing themselves to.
  • The following year, the FATF came out with a report that highlighted both legitimate uses and potential risks associated with virtual currencies.
  • In a different report, it again said the use of such virtual currencies was growing among terror financing groups.

Why did the RBI ban virtual currencies?

  • Owing to the lack of any underlying fiat, episodes of excessive volatility in their value, and their anonymous nature which goes against global money-laundering rules, the RBI initially flagged its concerns on trade and use of the currency.
  • Risks and concerns about data security and consumer protection on the one hand, and far-reaching potential impact on the effectiveness of monetary policy itself on the other hand, also had the RBI worried about virtual currencies.
  • In its arguments, RBI said it did not want these virtual currencies spreading like a contagion, and had, therefore, in the larger public interest, asked banks not to deal with people or exchanges dealing in these non-fiat currencies.
  • The RBI perceived significant spurt in the valuation of many virtual currencies and rapid growth in initial coin offerings as a risk.

Proponent’s stance

  • They said the RBI action was outside its purview as the non-fiat currency was not a currency as such.
  • They also argued that the action was too harsh and there had been no studies conducted either by the RBI or by the central government.
  • Arguing that the ban was solely on “moral grounds”, the petitioners said the RBI should have adopted a wait-and-watch approach, as taken by other regulators such as SEBI.

Faring the Proportionality test

  • In its judgment, the Supreme Court held that the RBI directive came up short on the five-prong test to check proportionality.

It includes:

  • the direct and immediate impact upon fundamental rights
  • the larger public interest sought to be ensured; a necessity to restrict citizens’ freedom
  • inherent pernicious nature of the act prohibited or its capacity or tendency to be harmful to the general public
  • the possibility of achieving the same object by imposing a less drastic restraint

Way Forward

  • The Supreme Court’s judgment could lead to the RBI rethinking its policies surrounding virtual currencies.
  • It is expected that the RBI will reconsider its approach to cryptocurrency and come up with a new, calibrated framework or regulation that deals with the reality of these technological advancements.
  • The decision will help those investors who had used legitimate money through banking channels.

By Explains

Explain the News

Blockchain Technology: Prospects and Challenges

[op-ed snap] The IMF should take over Libra and make the most of the idea


From UPSC perspective, the following things are important :

Prelims level : Libra

Mains level : A new currency system


The Libra Association is fragmenting. Visa, Mastercard, PayPal, Stripe, Mercado Pago and eBay have abandoned the Facebook-led corporate alliance underpinning Libra.


  • It is the asset-backed cryptocurrency meant to revolutionize international money.
  • Anyone with a mobile phone would be able to buy Libra tokens with domestic currency by standard methods such as debit cards and online banking. 
  • Those tokens could then be used to make payments to other Libra users, whether to purchase goods and services or repay debts. 
  • To ensure full transparency, all transactions would be handled by blockchain technology. 
  • In sharp contrast to Bitcoin, Libra tokens would be fully backed by copper-bottomed assets.

Financial mechanism 

  • To anchor Libra to tangible assets, the association backing it promised to use its revenues, along with the seed capital contributed by its member companies to buy highly liquid, highly rated financial assets. 

Challenges with Libra

  • Privatising – Humanity would have suffered if Facebook is allowed to use Libra to privatize the international payments system. The sole beneficiary would be the Libra Association, which would collect tremendous interest income on the assets from around the world using the large portion of global savings on its platform. 
  • Too big – Libra association would soon advance credit to individuals and corporations, graduating from a payments system to a global bank that no government could ever bail out, regulate or resolve.
  • Out of financial system – 2.4 billion monthly active Facebook users would suddenly have a new currency allowing them to transact with one another and bypass the rest of the financial system.
  • Criminal misuse – There is every possibility for high potential criminal uses of Libra. 
  • Volatility issues – Countries have invested a lot in minimizing the volatility of the purchasing power of domestic money. As a result of those efforts, 100 euros or dollars buy today more or less the same goods that they will buy next month. But the same could not be said of 100 euros or dollars converted into Libra.
  • Business cycles – Since the 2008 financial crash, authorities have struggled to manage inflation, employment and investment with the fiscal and monetary levers. Libra would further diminish states’ capacity to smoothen the business cycle. 
  • Fiscal policy challenge – Fiscal policy’s efficacy would suffer as the tax base shrinks with every payment shifting to a global payments system residing within Facebook. 
  • Impact on monetary policy – Central banks manage the quantity and flow of money by withdrawing or adding paper assets to the stock held by private banks. The more successful Libra becomes, the more money people will transfer from their bank account to their Libra wallet and the less able central banks will be to stabilize the economy.

Potential of Libra – to the IMF

  • The core concept of Libra can be handed over to the International Monetary Fund (IMF).
  • It can be used to reduce global trade imbalances and rebalance financial flows. 
  • A Libra-like cryptocurrency could help the IMF fulfil its original purpose.
  • Entrust implementation of the idea to the IMF to reinvent the international monetary system in a manner reflecting John Maynard Keynes’ rejected proposal at the 1944 Bretton Woods Conference for an International Clearing Union.
  • IMF would issue a blockchain-based, Libra-like token, say Kosmos, whose exchange rate with domestic currencies floats freely. 
  • People continue to use their domestic currency, but all cross-border trade and capital transfers are denominated in Kosmos and pass through their central bank’s account held at the IMF. 
  • Trade deficits and surpluses incur a trade-imbalance levy, while private financial institutions pay a fee in proportion to any surge of outward capital flows. 
  • All international transactions become frictionless and fully transparent.
  • Small but significant penalties keep trade and capital imbalances in check and fund green investment and remedial North-South wealth redistribution.

By Explains

Explain the News

Blockchain Technology: Prospects and Challenges

[op-ed snap] Cryptocurrencies could constrain a country’s choices


From UPSC perspective, the following things are important :

Prelims level : Bitcoins

Mains level : Libra; cryptocurrency and impact on monetary policies


Facebook announced launching a cryptocurrency called Libra, designed to appeal to its global user base of over 2 billion. 


  • It will be backed by a basket of fiat currencies. 
  • It is supported by a consortium of large-scale corporate houses, financial services firms, and venture capitalists. 
  • Millennials have little patience for expensive traditional banking methods for cash transactions. They would likely flock to alternatives like Libra.

Impossible trinity

  • It is the “trilemma” of monetary policy. It states that it is impossible to have all three of the following conditions fulfilled at the same time: 
    1. a fixed foreign exchange rate
    2. free capital movement
    3. an independent monetary policy 
  • Even before cryptocurrencies, governments looking to control the monetary aspects of their economies have been subject to this trilemma, and have been forced to implement only two of the three conditions.
  • If you want control over both your exchange rate and monetary policy, you would have to impose controls on free capital movement. 
  • Hence the existence of capital controls such as India’s Foreign Exchange Management Act.
  • The trilemma is a theory based on the “uncovered interest rate parity condition”.
  • It is supported by evidence-based studies where governments that have tried to simultaneously pursue all three goals have failed. 
  • Uncovered interest rate parity condition means that if a dollar can only fetch a 1% rate of return in the US, but 6% in India, investors are bound to move from dollars to rupees. The reason they don’t is that the differential of 5% will likely reduce to zero as a result of a slide in the rupee’s value to the extent of its current interest differential against the dollar.
  • Strong capital controls have meant that other means of payment have been in use before, such as the infamous “hawala” system. 
  • The ease of use and the scope of new Big-Tech cryptocurrencies are about to create global currencies of a completely different class. 
  • Economists argue that such currencies will affect the exchange rates and monetary policies of traditional currencies. This is because the introduction of a global digital currency removes the capital control levers that sovereign nations have today.

A case

  • If we assume a two-country system, both using their own national currencies as well as a global cryptocurrency.
  • Assuming markets are efficient and complete, and that the global cryptocurrency is freely used in both countries, they show that the interest rates in both countries must necessarily be equal, and the exchange rate between the two countries becomes a “martingale” – the best predictor of tomorrow’s value is today’s value.
  • This adds a further restriction to the impossible trinity, making it a dilemma. 


Thus the advent of Big Tech cryptocurrencies means that countries would have one less lever to pull.



Blockchain Technology and Bitcoins

By Explains

Explain the News

Blockchain Technology: Prospects and Challenges

[op-ed snap] Ban or regulate? — On India’s policy on cryptocurrencies


From UPSC perspective, the following things are important :

Prelims level : Nothing Much

Mains level : Regulation of cryptocurrencies


The recommendation of an inter-ministerial committee that India should ban all private cryptocurrencies, that is, Bitcoin and others like it, hardly comes as a surprise.


  • Indian policymakers and administrators have time and again made clear their distaste for them, their existence owed almost entirely to advanced encryption technologies
  • In his Budget speech in 2018, Finance Minister Arun Jaitley said the government doesn’t consider them legal tender.
  • The Reserve Bank of India has repeatedly warned the public of the risks associated with dealing with cryptocurrencies.
  • Bitcoin, the most prominent among them, has yo-yoed wildly in value, even over short periods of time.

Concerns with cryptocurrencies

  • A May 2019 article by Bloomberg, citing data from blockchain analysis firm Chainalysis, said “speculation remains Bitcoin’s primary use case”.
  • Its use in illegal online marketplaces that deal with drugs and child pornography is well-documented.
  • There have been cases of consumers being defrauded, including in India.
  • Given all this, it is understandable that the committee, under the chairmanship of Subhash Chandra Garg, the former Economic Affairs Secretary, has come across as being wary of private cryptocurrencies even while advocating a central bank-issued cryptocurrency.

No central authority to regulate 

  • Governments and economic regulators across the world are wary of private cryptocurrencies.
  • As they need neither a central issuing authority nor a central validating agency for transactions, these currencies can exist and thrive outside the realm of authority and regulation.
  • They are even deemed a threat to the official currency and monetary system. The question then is whether banning cryptocurrencies is the most effective way to respond.

Drafting a law

  • The inter-ministerial committee believes it is, going so far as to draft a law that mandates a fine and imprisonment of up to 10 years for the offences of mining, generating, holding, selling, dealing in, transferring, disposing of, or issuing cryptocurrencies.
  • But six of the seven jurisdictions that its report cites have not banned cryptocurrencies outright.
  • Many of them, including Canada, Thailand, Russia and Japan, seem to be moving on the path of regulation, so that transactions are within the purview of anti-money laundering and prevention of terror laws.
  • China, which India has taken a cue from, has gone for an outright ban.


  • Even there, the report says, “owing to the network-based nature of cryptocurrencies, after banning domestic crypto exchanges, many traders turned to overseas platforms to continue participating in crypto transactions.”
  • Trading in China is now low but not non-existent.
  • But why would an outright ban be a superior choice to regulation, especially in a field driven by fast-paced technological innovations?
  • The report, unfortunately, doesn’t clarify that point.

By Explains

Explain the News

Blockchain Technology: Prospects and Challenges

Cryptocurrency panel for ban on private digital currencies


From UPSC perspective, the following things are important :

Prelims level : Blockchain, Distributed ledger technology (DLT)

Mains level : Cryptocurrencies regulation in India

  • The committee set up to look into the legality of cryptocurrencies and blockchain has submitted its report to the Finance Ministry and recommended that private cryptocurrencies be banned completely in India.

Committee on cryptocurrencies

  • The government had constituted an Inter-Ministerial Committee in November 2017, under the Chairmanship of Economic Affairs Secretary Subhash Chandra Garg and comprising senior officials of the MEITY, SEBI and the RBI.
  • The committee notes with serious concern mushrooming of cryptocurrencies almost invariably issued abroad and numerous people in India investing in these.
  • The Committee, however, leaves the door open for the central bank issued cryptocurrencies, adding that it endorsed the RBI’s stance of banning any sort of interface of cryptocurrencies with the banking system in India.
  • The Committee recommends that all private cryptocurrencies, except any cryptocurrency issued by the state, be banned in India.
  • It endorses the stand taken by the RBI to eliminate the interface of institutions regulated by the RBI from cryptocurrencies.
  • However, the report goes on to say that it would be advisable to “have an open mind” regarding the introduction of an official, government-backed cryptocurrency in India.
  • But it also added that it is currently unclear what the advantages of such a currency in India would be.

Banning of Cryptocurrency & Regulation of Official Digital Currency Bill, 2019

  • The committee has drafted a law which mandates a fine and imprisonment of up to 10 years for offences.
  • The draft law says that anybody who mines, generates, holds, sells, deals in, transfers, disposes of or issues cryptocurrencies with will face a fine and/or jail time of between 1 and 10 years.
  • The fine has been set at the either three times the loss or harm caused by a person, or three times the gain made by the person, whichever is higher.

Why ban cryptocurrencies?

  • All the cryptocurrencies have been created by non-sovereigns.
  • They do not have any intrinsic value of their own and lack any of the attributes of a currency.
  • That is, they neither act as a store of value nor are they a medium of exchange in themselves.
  • These cryptocurrencies cannot serve the purpose of a currency.
  • The private cryptocurrencies are inconsistent with the essential functions of money/currency, hence private cryptocurrencies cannot replace fiat currencies.

More focus on the use of distributed ledger technology (DLT) and blockchain

  • Distributed ledger technology (DLT) is a digital system for recording the transaction of assets in which the transactions and their details are recorded in multiple places at the same time.
  • Unlike traditional databases, distributed ledgers have no central data store or administration functionality.
  • While the committee has taken a strong stance against cryptocurrencies, it has highlighted the benefits of the underlying technology—the distributed ledger technology (DLT) and blockchain.
  • The Committee recommends that blockchain based systems may be considered by MEITY for building a low-cost KYC system that reduces the need for duplication of KYC requirements for individuals.
  • Further, the report said that DLT-based systems can be used by banks and other financial firms for loan tracking, collateral management, fraud detection, claims management in insurance etc.
  • Similarly, DLT can be beneficial for removing errors and frauds in land markets if the technology is implemented for maintaining land records.
  • The Committee therefore recommends that various state governments may examine the feasibility of using DLT for land-records management.



  • Blockchain/ DLT are the building block of “internet of value,” and enable recording of interactions and transfer “value” peer-to-peer, without a need for a centrally coordinating entity.
  • “Value” refers to any record of ownership of asset — for example, money, securities, land titles — and also ownership of specific information like identity, health information and other personal data.
  • Blockchain is one type of a distributed ledger.

By Explains

Explain the News

Blockchain Technology: Prospects and Challenges

Facebook’s cryptocurrency ‘Libra’


From UPSC perspective, the following things are important :

Prelims level : Libra, Calibra

Mains level : Blockchain technology

  • There’s a new cryptocurrency called Libra to be rolled out by Facebook by 2020.
  • Facebook also announced a dedicated wallet app called Calibra, which will be built into WhatsApp and Messenger as well, to let users store and use these Libra coins.

What is Libra?

  • Libra is a cryptocurrency built on a blockchain network, though Facebook was quick to insist that it will respect user privacy and transactions will in no way to be linked to the user’s real world identity.
  • Libra is like any other cryptocurrency powered by blockchain technology.
  • It wants to be a ‘global currency’, one that can be used to transfer money anywhere in the world without any transaction fees.
  • The claim is that Libra will be accessible to anyone with a smartphone, even a low-cost budget phone, and a network connection.
  • Of course, there are several mobile payment services already offering seamless payments, though with real-money.

Calibra Wallet

  • Calibra is the digital wallet from Facebook to let users store these Libra coins.
  • Facebook says this is a separate company, and data will not be shared with them and it will respect user privacy.
  • Calibra will have a dedicated team of experts in risk management to prevent fraudulent use.
  • Also if someone loses their Libra coins from the Calibra wallet, they will refund users. Libra will also work with other third-party wallets.
  • Calibra will also be added to WhatsApp and Messenger.

How will Libra blockchain work?

  • Libra is also being governed by the independent Libra Association, which is not what you see in typical cryptocurrency.
  • A new programming language is also being built for Libra called Move, which the organisation claims is more secure and private.
  • The Libra Blockchain will record the history of transactions and states over time, rather than the typical blockchain where each transaction is added a new block.

Buying Libras

  • The network is still far from ready. The Libra blockchain will be tested over the coming months.
  • While there’s no word on exactly how someone will buy Libra, the Calibra wallet from Facebook will probably be one way.
  • To purchase Libra, user will have to pay in their local currency, provided the laws allow it.

Its uniqueness

  • Libra will also be backed by a reserve of assets designed in order to “give it intrinsic value” and ensure stability, which is not seen in typical cryptocurrencies.
  • These assets includes securities and fiat currencies (like dollar, pound) etc as part of this reserve.
  • The website says Libra will be backed by “short-term government securities in currencies from stable and reputable central banks.”
  • Still the “value of the one Libra in any local currency may fluctuate,” cautions the page.
  • The idea is to ensure Libra is stable to give more users confidence in this, while ensuring that currency does not fluctuate wildly like other cryptocurrencies such as Bitcoin which had at point had reached a high of $20,000.

Is Facebook the sole company involved in Libra?

  • Facebook is not the only company, though it has leadership role for all of 2019, which means it will have a significant role in deciding the direction for Libra at least for this year.
  • Facebook’s teams have also helped build the technology for the currency.

Will Libra work in India?

  • Cryptocurrency is illegal in India and the draft bill right now is recommending a maximum of 10 year punishment for those who mine, trade, buy or sell these.
  • In India, if the bill passes, trading in cryptocurrency could result in hard punishment.
  • So one of the biggest markets, which is India, will not be able to use Libra, which could limit its potential.
  • The Supreme Court of India is hearing a matter regarding regulation of Bitcoin in India and the matter will now be heard on July 23, 2019.


Blockchain Technology and Bitcoins

By Explains

Explain the News

By Explains

Explain the News

Notify of
1 Comment
Newest Most Voted
Inline Feedbacks
View all comments
emma johnson
emma johnson
3 months ago was created for the bitcoin mixer community with three things in mind, trust, speed, and security.
We understand that using a bitcoin mixer for the first time can be uncomfortable so we recommend splitting larger transactions into multiple ones until you’re comfortable with the process.