With Bitcoin’s breath-taking popularity all over the world in the past couple of months, the government was expected to provide clarity on cryptocurrencies. India’s Finance Minister Arun Jaitley has stated in his Budget speech that,” The currency is illegal and the government was not going to recognize it. The ever-increasing liking for bitcoin- a cryptocurrency which has rocketed to shocking highs, has already come under the radar of the government. Bitcoin may be an easy method To evade taxes or traps, unsuspecting small investors in Ponzi schemes.
The government has already started to take measures to track/stop the illegal use of this unregulated virtual currency. But, Jaitley has declared that the government will adopt blockchain, the technology that supports cryptocurrencies.
The Reserve Bank of India already leans forward looking at the new era of cryptocurrency. The Bitcoin’s growth might have encouraged the central bank to consider its own cryptocurrency as it’s not comfortable with this non-fiat cryptocurrency that would become an option to the Indian rupee for electronic transactions. A group of experts at RBI is examining the chance of a fiat cryptocurrency that would become an alternative to the rupee for electronic transactions.
RBI’s cryptocurrency might be part of creating its own Blockchain, a dispersed electronic ledger, and technology that supports cryptocurrencies. State Bank of India has taken the lead in bring lenders and technology companies together for utilizing Blockchain technology to share info among banks that will ultimately assist in preventing scams and handle bad loans that are almost one 5th of banks loan book. The SBI initiative, called Bank chain, is currently in partnership with IBM, Microsoft, Skylark, KPMG and 10 commercials banks.