Bitcoin was once again in the news after Tesla invested $1.5 billion in it and signaled its intent to begin accepting the cryptocurrency as a form of payment, sending prices to a new record after the vote of confidence. The leading electric-car maker's embrace of Bitcoin lends increased legitimacy to electronic currencies, which have become more of a mainstream asset in recent years.
1. First launched in 2009, Bitcoin is a kind of cryptocurrency or digital currency that exists completely online.
2. By its very nature, the currency is decentralized without a single central bank to administer it and the currency is stored in digital wallets.
3. These wallets are backed by private and public keys for security, and the public key is what lets users transact with each other.
4. All transactions are verified and recorded in a public ledger called the blockchain with complete transparency ensuring that the system cannot be cheated.
5. Because of its decentralized nature and the anonymity associated with it, the currency can be easily traded across users and countries without identifying the person who holds the bitcoin.
6. The popularity of bitcoin has spurred a range of alternate crypto currency including Etherium, Dogecoin and Binance.
7. In India, Bitcoin stands in a grey area of legality. As of now, it is not illegal to trade bitcoin, however, the Cryptocurrency and regulation of Official Digital Currency Bill aims to ban bitcoin.
8. Instead, the Indian government seeks to create its own national cryptocurrency.
9. India temporarily banned crypto transactions in 2018, however, the bill was overturned by the Supreme Court after cryptocurrency exchanges filed a lawsuit.
10. With the growing global acceptance of the digital fiat as legal tender, it remains to be seen exactly how the Indian government will proceed with its draft regulation.