In more ways than one, the cryptocurrency boom across the world and India especially is very much like the IT boom of the 1990s, both characterized by an increase in usage by the general public and the potential to affect and considerably change the face of finance in the country.
Many businesses are already figuring out how decentralized technology like crypto and blockchain can benefit them. Moreover, the key benefit of cryptocurrency is that it enables many people to participate in the burgeoning economy.
A bit about bitcoins
What is a cryptocurrency, one may ask? In quite simple terms, a cryptocurrency is a tradable form of digital currency that can purchase goods and services online. It has no existence in the material realm, requiring only a transaction performed over the internet through this can later be converted into fiat currency through a legal process in a bank.
Bitcoin was the first cryptocurrency to be introduced as open-source software in 2009 and since then, there have been many other cryptocurrencies following it.
Initially regarded with skepticism in the world of international finance, crypto has been a tremendous success looking at the fact that 1 Bitcoin is equivalent to $48719.56 as of right now. Imagine its value in a country like India.
Crypto currency is a good option for those who have just set up businesses or are considering investing in startups since the transactions therein are more transparent and accessible than the usual, orthodox means.
Where earlier one had to wait for days to secure a transfer of funds from one country to another, the blockchain technology now ensures transfer within minutes utilizing end to end encryption. Countries like Singapore and China are even developing faster, more efficient ways of settling and clearing payments in a matter of seconds.
Take all that vast potential and use it on the macro level. Two countries with a positive attitude towards cryptocurrency can easily conduct trade rather than wade through a long, exhaustive process of bureaucratic red-tape, delays and eventual diplomatic frustration. And this extends to all the aspects of trade between two countries.
Lawmakers in India are still debating whether to accept crypto as either legal tender or at least allow it some sort of legal status to be used in the place of fiat currency for select transactions.
To be fair, there needs to be a strict set of rules and regulations to prevent malpractices while fostering a friendly environment for it to thrive properly.
Recently there have been many positive signs which show that the Indian government is moving away from placing an outright ban on cryptocurrency to a more cooperative approach with the major stakeholders in the ecosystem.
A number of homegrown crypto trading platforms are available nowadays, like CoinDCX Go and Coinswitch Kuber, where anyone can set up a profile and buy and sell several types of crypto. These new apps are laced with features that make it easy for any interested customer to buy crypto within the first five minutes of downloading it.
The major source of revenue for a crypto trading platform is the commission on each trade. As such, the revenue being raked in every month by our own companies is massive. WazirX, another Indian platform, reported recently that it had recorded a trading volume of over $28 billion in 2021.