Blockchain Gets New Boost In Budget 2018, Cryptocurrency Not A Legal Tender

The government has made it clear that cryptocurrencies were not a legal tender in India. At the same time, the Union Budget 2018 had recognised blockchain technology and said that it allowed the organisation of any chain records or transactions, without the need of any intermediaries.

“Distributed ledger system or the blockchain technology allows the organisation of any chain of records or transactions, without the need of intermediaries. The government will explore the use of blockchain technology proactively for ushering in a digital economy,” said Finance minister Arun Jaitley during the budget speech.

As per the report by LiveMint, companies engaged in bitcoin exchange are not happy with the government’s approach. “There is no repercussion of the Budget announcements to what we are doing right now. Until and unless the authorities make a more concrete comment, for us, it is business as usual. They worry that the common man is going to enter it because of the price surge. But that has been the stance since December 2013 when the Reserve Bank of India (RBI) first issued cautionary notes. They should give us some more clarity,” said Jincy Samuel, chief operating officer, Coinsecure to LiveMint.

Cryptocurrency Vs Blockchain

The blockchain is the technology which enabled the existence of cryptocurrency. Bitcoin is the popular cryptocurrency. Cryptocurrency is a medium of exchange akin to US dollar, but it is digital.

Cryptocurrency stands for digital currency which uses cryptography to secure transactions and to verify transfer of assets. It is also called ‘alternative currency’ and ‘virtual currency’. Bitcoin is a type of cryptocurrency which operates using encryption technique. It does not have a legal backing from the central bank. This unregulated digital currency was created by Satoshi Nakamato in 2009. Satoshi Nakamato refers to the unknown person or people who developed bitcoin.

Countries like India, US, China, Japan, and France have raised their concern over the increasing popularity of Bitcoin. India’s central bank made it clear that cryptocurrencies can act as a channel for terrorist financing and money laundering.

In blockchain technology, transactions made in digital currencies are recorded publicly and chronologically. It is not synonymous with bitcoin, but as a technology, it supports bitcoin trading. This technique can be used for a variety of purposes like tracking ownership or the provenance of documents, digital assets, physical assets or even voting rights.

Also, read:

RBI Reiterates Warning About Using Bitcoins And Other Virtual Currencies

Bitcoin: What Is It, How It Works & What It Means For The Future Of Money