The SC has allowed the usage of cryptocurrencies in trade, cancels RBI’s circular of 2018
Bengaluru: Cryptocurrencies finally got the nod of the top court in the country as it allowed its usage.
The SC observed, “Trading in cryptocurrencies will now be allowed.”
It might be recalled that, in April 2018, the RBI had issued a circular barring banking and financial services from dealing in virtual currency or cryptocurrency such as Bitcoin, most valued cryptocurrency in the world.
"Investments had stopped and start-ups were staying away from starting business in the crypto and blockchain space in India which will change now that the Supreme Court has said that the RBI circular was unconstitutional," Nischal Shetty, CEO of WazirX, an Indian cryptocurrency exchange, told news agency Reuters.
What Is Cryptocurrency?
Cryptocurrencies use cryptographic protocols, or extremely complex code systems that encrypt sensitive data transfers, to secure their units of exchange.
Cryptocurrency developers build these protocols on advanced mathematics and computer engineering principles that render them virtually impossible to break, and thus to duplicate or counterfeit the protected currencies. These protocols also mask the identities of cryptocurrency users, making transactions and fund flows difficult to attribute to specific individuals or groups.
Benefits and Drawbacks
Due to their political independence and essentially impenetrable data security, cryptocurrency users enjoy benefits not available to users of traditional fiat currencies, such as the U.S. dollar, and the financial systems that those currencies support. For instance, whereas a government can easily freeze or even seize a bank account located in its jurisdiction, it’s very difficult for it to do the same with funds held in cryptocurrency – even if the holder is a citizen or legal resident.
On the other hand, cryptocurrencies come with a host of risks and drawbacks, such as illiquidity and value volatility, that don’t affect many fiat currencies. Additionally, cryptocurrencies are frequently used to facilitate gray and black market transactions, so many countries view them with distrust or outright animosity. And while some proponents tout cryptocurrencies as potentially lucrative alternative investments, few (if any) serious financial professionals view them as suitable for anything other than pure speculation.
The above information was taken from moneychrasher.com
Read Exclusive COVID-19 Coronavirus News updates, at MyNation.
Last Updated Mar 4, 2020, 1:33 PM IST