India on Cryptocurrency !! Right to Expression Thought Of the Day

Many of the people across the globe are now familiar with the term "Bitcoin" even if some of those people may not know what actually "Bitcoin" is. Well, when something gets popular, they get recognized by their name, not by their "Type". e.g. Still many people ask for "Colgate", not a "Toothpaste" in the shops, If you know what I mean😜. Likewise, people want to invest in Bitcoin being unaware of the "Altcoins", which are also "Crypto currencies". It means the term "Bitcoin" brings the term "Crypto currency" into the light. So, who wouldn't be curious to know about such things, when you get to know from someone that your money gets double or triple within a very short span of time compared to the money kept in your bank account?😊

What is Cryptocurrency?

A Crypto currency is a form of digital money that has been designed to make safe and secure transaction keeping the transactors' identity anonymous. It is a medium of exchange that uses cryptography to secure its transactions, to control the creation of additional units and verify the transfer of assets. They are of mainly 3 types - Digital Crypto currency, Alternative Crypto currency and Virtual Crypto currency. Crypto currencies use "Decentralized" system. All the transactions made through Crypto currencies are recorded in a digital Ledger, chronologically and publicly, which is known as "Blockchain".

Bitcoin is the first decentralized Crypto currency introduced in the year 2009. All the other coins except Bitcoin are called "Altcoins".

Centralization & Decentralization

"Centralization" means "The concentration of control of an activity or Organization under a single authority".

"Decentralization" means " The movement of departments of a large organization away from a single administrative center to other locations".

In simple words, In Centralized system, The Government controls everything and it works as the center of all the activities; whereas in Decentralized system liberty and the flexibility of any activity is permissible, an activity can be done by anybody from anywhere at any time.

Crypto currency in India

Legality of Crypto currencies is still a Big NO-NO in many countries including India, whereas Bitcoin is legal in countries like United states, Canada and Mexico. The biggest reason of Crypto currencies being restricted to be circulated legally in some particular nations is that, They can not be traced at all since the anonymity of the transactors are kept intact and They may be used for promoting illegal activities like cyber crime.

However, renowned companies like Microsoft, IBM and Toyota have invested in Blockchain and looking at their potential applications.

Finance Minister of India, Mr. Arun jaitley once said in the parliament that " Bitcoin is not a Legal tender and that's why Government can not take any responsibility of protection of any crypto currency transactions". Since the topic of "Crypto currency" is now being contemplated across the globe, there is no such statement that has been made by any govt. official where ban on crypto currencies were discussed, though Mr. jaitley said they are not legal tender.

On 2oth february this year, a cabinet meeting was held, in which Finance Minister Mr. Arun Jaitley and Prime Minister Mr. Narendra modi took part and passed a bill against all the ponzi schemes which are making transactions using crypto currencies. Now a days, many of the MLM companies are accepting Cryptos as joining fee and paying the joinees through Cryptos, which is illegal according to the bill passed recently and such activities found in operation will be penalised by upto Rs.50 crores fine and 5 -10 years of jail term. Moreover, many of the ICOs (Initial Coin Offering) are also found to be fake i.e BitConnect, Confido, REcoin, PlexCoin etc. China has banned ICOs along with exchanges where coins are traded.

Even if it has been said that the Cryptos are not legal tender in India, govt has levied a certain amount of tax on the transaction of cryptos . Taxation have been made as such -

* Bitcoins earned through mining : No taxes (tentative)

* Bitcoins purchased from Bitcoin exchange : taxable

Long term (more than 3 years) : flat 20% tax
Short term (less than 3 years) : according to individual tax slab rate (applicable on income)

* Bitcoins received in return for sale of goods or services : taxable according to individual tax slab rate ( applicable on income)

While many of the countries are ok with cryptos being legitimate to use, why countries like India and China are so fearful about it ? Do Cryptos have any potential to make a country's economy grow being decentralized ? How can this virtual currency be used for only good purposes? Please do comment your views and suggestions below-