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India must regulate cryptocurrencies in consumer interest: Report

Over the previous five years, the Indian crypto asset business has grown at an exponential rate. Presently, more than 15 million Indians hold digital currencies. Thus, experts argue cryptocurrencies, like any other financial asset, require regulation to safeguard consumers while also encouraging innovation.

India must regulate cryptocurrencies in consumer interest : report

According to the Esya Centre and Observer Research Foundation’s research ‘Regulating Crypto Assets in India’. There are huge speculations for Crypto assets to constitute the foundation of future forms of the internet. The report examines the world of cryptocurrencies in India. One of the world’s fastest-growing economies, and comes as New Delhi prepares to propose legislation to govern the commodity.

Crypto-assets are not only likely to provide the foundation for future forms of the internet. But India is well-positioned to profit from this due to its burgeoning private crypto market, according to the analysis. Given this, industry experts argue that banning private crypto assets would be imprudent. Because it would result in huge income loss for the government and force emerging firms to operate illegally. Instead, the research recommends a balanced regulatory strategy that balances concerns about fiscal stability, money laundering, investor protection, and regulatory certainty with the preservation of innovation.

India must regulate crypto currencies

Most regulatory equations essential to address policy problems connected to crypto-assets, such as investor protection, foreign exchange management, money-laundering, and tax evasion, already exist in financial legislation, says one of the authors, Meghna Bal. They only need some adjustments to fit into a new technological paradigm.”

Experts in India believe that defining cryptocurrency as a security, product, or capital asset could result in unforeseen investment limits or regulatory gaps in crucial policy areas. According to the report, a unique crypto framework that incorporates the intricacies of the crypto business would be more relevant and in line with global trends.

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Want to invest in cryptocurrency? Here is all you need to know

For a long time, cryptocurrency has been a source of contention. Investing in it is usually frowned upon by investors. Cryptocurrency investors should have a high-risk tolerance because it is a volatile asset class.

all you need to know about cryptocurrency

For instance, in April 2021, the world’s largest cryptocurrency, Bitcoin, hit an almost four-month low. Bitcoin has already plunged 50% from its record high of $64,895 to $30,066. During the same month, Ethereum had also plunged over 57% to $1,850.

In this class of assets, there have always been a lot of unknowns. Indians, on the other hand, have not shied away from investing in this asset. However, one should not enter it unprepared. Before you jump in, do some research on the asset class.

“Do the work – research – learn everything you can about the sector, the currencies, the projects, the innovation,” says Darshan Bathija, CEO and Co-Founder of Vault. Don’t take everything you see on social media at face value.”

“We’ve all heard about someone who invested in a cryptocurrency and received a significant return on investment,” he continues. Don’t waste your money on something you don’t understand.”

Before diving into the crypto world, determine what type of investor are you and which investments are your best fit. It’s worth noting that the recent volatility in the cryptocurrency market has acquired a lot of press. “Understanding your aim with digital asset investments that suit your risk appetite,” Bathija continues, “is one of the most crucial steps you should sketch out before leaping.”

What is the best way to invest in cryptocurrencies?

Create a strategy for your bitcoin assets, such as establishing limit orders on trades and selecting an exchange. Experts advise that users check that the exchange they choose has a high level of liquidity, a diverse range of crypto assets, and a user-friendly interface.

cryptocurrency investments

“What needs to be taken into account is the project’s stability,” Bathija says, even if investing in the correct digital asset might be tricky at times. Look at the collective trust that a coin’s community has in the project when it comes to digital assets.”

Transaction cost, transaction speed, and divisibility are all things to consider. As a result, before you decide to acquire an altcoin, do your homework on all of these topics. Also, be aware of the project’s existing limits, and double-check credible sources to determine that the project is real and functional.

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Cryptocurrency regulation work nearly complete: FM Sitharaman

Finance Minister Nirmala Sitharam come forward to tell that the Union Government is not against cryptocurrency regulation. Instead, the government is looking into various ways to help the country’s fintech sector. According to Sitharaman, cryptocurrency is a huge potential sector with a lot of global advances going on.

She added, “We can’t keep going as if this isn’t a problem. We’re not going to say no to cryptocurrencies. We’re implying that we’ll have to explore how this technology can assist fintech in realizing its full potential. But I’d like to collaborate with the RBI on how sophisticated regulation can be”. The finance minister also stated that the work was almost complete and that the cabinet needed to make a decision right away.

What are the speculations related to the cryptocurrency bill?

cryptocurrency regulation

The proposed bill for cryptocurrency regulation narrowly left from its introduction during the Parliament’s Monsoon Session. According to the Lok Sabha Secretariat’s bulletin for the Budget Session; the main goal of the cryptocurrency bill will be to create the official digital currency issued by the Reserve Bank of India. The measure seeks to restrict all private cryptocurrencies in India. However, it would allow limited exclusions to encourage the underlying technology of cryptocurrency and its uses.

According to a survey by Analytics Insight, Indians had spent roughly $ 6.6 billion in cryptocurrencies through May 2021. This represents a 600% increase from $923 million in April 2020. It is estimated that around 1.5 crore Indians have invested in cryptocurrency. In the blockchain and cryptocurrency field, there are currently over 350 firms. Owing to the high level of investor interest and the quickly growing cryptocurrency industry. The government is taking a cautious approach to cryptocurrencies.

For more such updates, keep watching this space!

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Bitcoin crashes on Elon Musk U-turn citing energy consumption

Cryptocurrency fans have counted Tesla boss, Elon Musk as among their championships. Bitcoin, cryptocurrency investors have risen more in this pandemic. In his recent tweet, he said, “it is high time there was a carbon tax!”. If we look at the decision from the environmental point of view, this may be the best decision. But on the other hand, this has created a huge mess in the stock market.

Tesla proposed purchasing a vehicle through bitcoin currency recently. And now we see a tweet about the carbon emission which is increasing due to bitcoin mining. He suspended vehicle purchases using Bitcoin. He has also mentioned that we are concerned about the environment. For Bitcoin mining and transactions, fossil fuels are used especially coal, and it has the worst emissions of any fuel. Due to this change in the stock market cryptocurrency’s value gone down 15% to a two-and-a-half-month low.

Bitcoin and Energy consumption

Bitcoin Power Consumption

Obtaining bitcoin is an energy-intensive endeavor. The chart shows the evolution of power usage, rising constantly from the year 2016 and increasing sharply in 2020.

On an annualized basis, it hit its current level of 149 terawatt-hours, an all-time high. The data if we compare to Google’s entire energy usage of 12.2 TWh, and approximately 200 TWh used by all data centers in the world. One more interesting fact is that if Bitcoin were a country, it would use around the same amount of electricity a year to mine as Switzerland does in total.

According to the IEA prediction, the situation could worsen, if miners used the most energy-intensive equipment, their consumption could rise to 500 TWh.

For more updates like these, keep watching this space!