cryptocurrency

What is Crypto Currency?

Crypto currency is a type of digital currency which uses secure communication called cryptography and verifies the transactions by a decentralized system. Crypto currencies are digital assets that don’t have any regulating authority. However, the decentralized system records all crypto money transactions and issues new units.

Crypto Currency and The Information Age

Due to the old trickery of events, individuals are usually seen accepting the old tricks and concepts as simply “the way things are.” However, the same individuals, in the changing world order, use their prerequisite knowledge to reach certain explanations of the theories that are new and interesting to delve into.

Take the financial sector and crypto currencies for example. Rarely is an individual seen questioning the genesis of money and the banking system? However, in contrast to such arcane behavior, we now witness a radical shift toward questioning the cryptocurrency legitimacy or digital currency. With the dissemination of data that has readily become decentralized, the internet has been seen as ushering in a revolution, which can be seen as radically democratizing information. 

If crypto currencies were invented in the previous decade, chances are that people might have abstained from its use and might have loathed the newer entry into the market. But with the rise of the information age and the increasing need for autonomy, digital currencies have been deciphered as a friend rather than a foe. What entices the audience about crypto money is the fact that Crypto can automatically and instantaneously share your data’s value with you, unlike the arcane financial system that didn’t recognize an individual as a partner but as a product.

The genesis crypto currency

With the rise of the information age, we witness that the financial system remains stubbornly stuck in an industrial age. Such an industrialized notion of functioning is based on the fact that the financial systems presume that the needs of oil-based manufacturing are paramount. However, this no longer stands true. Experts and academia have testified to the fact that the World’s Most Valuable Resource is empathically and effectively no longer Oil, but rather it is Data. 

Even though we discredit the industrialized age, we cannot help but deny the fact that the information age to has been disastrous in itself. With the power of data, the information age has led the existing economic system to hoard and extract vast amounts of wealth for a few in one place. A very glaring example of the same is Silicon Valley.

It is to be noted here that information is finding its way wherever the value is being generated by that information. Thus, information finds its way to all the social networks which make huge amounts of money.

How the crypto currency seeps in?

It is not news that individuals or the public realize the importance of the decentralized world. Thus, it is quite a collory to state that the same individuals will also value crypto currency highly. But why is it so? It is to be noted that crypto currency has immense potential to offer a set of Information Age economic tools that can efficiently and effectively increase the efficiency of how money travels around various sectors.

On top of the dismantling of information, it also takes into consideration how value is distributed amongst these sectors. With the invention of UPI, payments have suddenly been made instantaneously. With the help of technological advancement, stimulus payments, welfare checks, etc. can be all distributed and collected instantaneously. Crypto currency through its decentralized state can help transactions and capital to flow between parties without the meddling of all the costly intermediaries which persistently and arduously slow the financial system down.

Much of this advantage is being reaped by a number of crypto billionaires and as the billionaires climb, so will the number of nonprofits which will start accepting these decentralized, contentious digital assets. This will highly bring about integration in the technology and the crypto sectors.

On top of the decentralized financial sector, the crypto currency also offers a more fair and efficient distribution of wealth itself which was a major problem in the industrialized world. This can be explained by the mechanism that as enormous new amounts of wealth and value are being generated by this information economy, information age economic tools emphatically a rightly have the power and immense ability to distribute that wealth and value amongst the masses as quickly.

In a contrast to the game where Facebook takes all of your data and sells it making humungous profits for itself, crypto can automatically share your data’s value with you. This is due to the fact that crypto offers you the power to become a partner and not a product. This crypto currency can rightfully be stated as the currency of the information age.

With much-needed integration, wealth would effectively flow just as information does. It won’t be concentrated at a singular point where it’s hoarded by a small class of billionaires but would rather be seen flowing in every way. This might be a long short to state but with the flowing of information and crypto currency around the globe, it can also create the opportunity to eliminate poverty worldwide.

This model of universal income can be realized by imagining every person as an endless and regenerative source of value. With all the information that is needed which effectively at the moment makes a few people extraordinarily wealthy, can now provide the same luxury to all around the globe.

Thus, decentralized crypto currency has much potential to eliminate global poverty but it needs to be accepted worldwide, unlike some nations that have an antagonistic and aversive stance against it. With a dream of an egalitarian world, perhaps the policymakers will be able to use the information technology more sagaciously. The threat is not of disapproval, but rather that of negligence and underutilization of the potential that has the power to alter the world wealth scenario.

Cryptocurrency Regulation Laws Around the World

It is no news that the cryptocurrency community around the world and especially in India is ever increasing. One might call it enticement of humungous profits or rather no relations, but one cannot deny the fact that the contentious asset’s admirers community is here to stay.

But with the governments around the world trying to regulate digital assets, the community is every now and then seen sweltering with tension whenever there is the mere mention of regulation.

Recently, in India, whenever Parliament has been in session, the cryptocurrency community has been abuzz with nervousness and anxiety.

The anxiety is due to the pressing questions that lie will the law on cryptocurrencies be finally passed? If yes, will it ban the private currencies in India?

While there are few chances that one can exactly pinpoint when such laws will be passed in the parliament, there are even little chances to assume that will the crypto law in India will be passed in Parliament.

What especially incites the anxiety of an investor is the fact that it is unclear what form the regulation will ultimately take place in India?

Quite interestingly, India is not the only country that is in the race to regulate contentious digital assets. Given the difference in policymaking in different countries, the groupings emphatically have their own ways of regulating cryptocurrencies.

But it is safe to say that India has so far been among the most closed to cryptocurrencies. Going by the media reports, there is little reason to believe that the cryptocurrency will not be tabled in the parliament in India.

Amongst various other countries, the United Kingdom does not effectively have comprehensive legislation on cryptocurrency regulation. Under the current regulatory system, the Financial Conduct Authority effectively grants licenses to authorized cryptocurrency-related businesses.

It is to be noted that all the cryptocurrency-related businesses that seek a license from the FCA, have to stringently comply with the strategic set of rules that have been laid out.

In fact, it is to be noted that the rules are all the more stringent for those companies that emphatically and effectively deal with crypto futures and options trading.

It is worthy of mentioning here that the UK is also concerned with its crypto taxation policy. All the businesses that effectively engage in crypto trading or crypto exchanges fall under corporate tax rules.

Thus, it can be argued that the UK taxes gains from cryptocurrency trading are treated equally as any gains from any other currency trading.

Unlike the UK, US and India, have a dual legislative system. Here the central government, as well as the State Governments, have the effective powers to legislate.

Thus, due to the dual legislative attribute, the regulations regarding cryptocurrencies usually vary across States. This is especially true for the US. But looking at the bigger picture, the country, overall, has been increasingly in favor of allowing all cryptocurrency activities.

New York, in recent times, is increasingly becoming the poster child for a favorable legislative environment. It was in 2016 when New York had effectively and emphatically launched a framework for licensing cryptocurrency business. Under the recent system, companies that are strategically looking forward to transmitting, or selling, or holding cryptocurrencies need to obtain a license from the New York State Department of Financial Services.

Having talked about the US and the UK, it would be a gross error to not indulge in the subject of crypto regulations in the European Union. In comparison to the UK and the US, Legislation in the European Union is a complicated matter. This is due to the fact that some topics are being dealt with by the Union and some by the member states.

As a matter of fact, cryptocurrencies have been regulated by each country in the EU. Most opted for the framework for the regulation of the cryptocurrency that has come to the fore is the soft-touch regulatory framework.

Though a consolidated framework is on the way, for a while soft touch, the bifurcated regulatory framework is at play.
China, on the other hand, has held a long grudge against the cryptocurrency holders and the ones dealing with cryptocurrencies. One can state that cryptocurrency has been such a roller-coaster ride.

Whereat first, it was witnessed that the Chinese government was quite welcoming but in recent times, it has effectively become the most restricted crypto-markets in the world. Given the fact that China constitutes about 75% of all crypto-mining in the world, such an antagonistic stance gains importance for crypto regulators around the world.

In June 2021, the crypto regulators saw the banning of the mining of cryptocurrencies. This effectively led to about a 40% fall in global mining operations.

Talking about India, the spectators have usually witnessed India’s conservative approach towards cryptocurrencies, with high chances of banning the private contentious digital asset.

With glaring news of the RBI trying to ban the cryptocurrency, the private investors might witness a change from private crypto trading to regulated CBDC trading in the country.

It is to be noted that the Cryptocurrency and Regulation of Official Digital Currency Bill, 2021 is effectively listed for introduction in Parliament’s Winter Session.

The bill effectively seeks to create a facilitative framework for the creation of the offline digital currency to be issued by the apex bank of India.

Given the RBI’s antagonistic attitude towards cryptocurrency, the Indian government is trying to follow the dual path of looking to strictly control or even ban cryptocurrencies.

On the other hand, it is also trying to encourage the use of blockchain technologies which have immense potential for the economy.

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