What is Cryptocurrency?
The Supreme Court has lifted the ban on the use of virtual currency (cryptocurrency) and allowed its use in transactions. The Reserve Bank of India (RBI) had in April 2018 banned the trading of virtual currencies like Bitcoin. The RBI had tightened rules on Bitcoin and other virtual currencies. This time, they had banned banks and other financial institutions from providing any services, but now the ban has been lifted. But what is cryptocurrency? What is its history? Many are unaware of this. The concept of virtual currency is now almost a decade old. So most people know what a virtual currency is. Virtual currency means ‘cryptocurrency’ is a currency created based on a computer algorithm. This currency has no physical form. However, you can use it for financial transactions.
The concept of Bitcoin was born in 2009 by an engineer named Satoshi Nakamoto.
‘Bitcoin’ came into being by performing mathematical calculations in a computer program. Over the past decade, hundreds of types of cryptocurrencies have emerged in the computer world.
Financial transactions made with this type of virtual currency are highly confidential. You do not need to be affiliated with any bank for these currency transactions. Being a decentralized system, no company or country has a monopoly on this virtual currency.
The use of virtual currency has been on the rise for the last decade as there are no borders of any country and no form of tax is applicable to them. As a result, the turnover of these virtual currencies has reached billions of dollars in the last decade.
Banks, hotels, companies, websites in many countries have adopted virtual currency. Therefore, the value of this currency is increasing day by day. This is where the exchange market for these virtual currencies came from. In these markets, the value of virtual currencies around the world relative to physical currencies is determined on a daily basis.
The value of the first virtual currency, Bitcoin, is skyrocketing. In April last year (2019), the value of a bitcoin had reached around जवळपास 9,000. In terms of Indian Rupees, a bitcoin is worth around Rs 6 lakh 6,000.
Another example of the horse race of all virtual currencies like Bitcoin can be given by India itself. On April 28, 2019, the value of a bitcoin was 3 lakh 60 thousand rupees. The same price reached Rs 6 lakh 6 thousand on May 28, 2019. That is, if one sells a bitcoin bought in April in May, one can earn a whopping Rs 3 lakh in a month.
So, this is the growing empire of virtual currency. Virtual currency is still not recognized in many countries. Even today, it does not fit into the law. Yet these virtual currencies have a turnover of billions of dollars.
Naturally, Facebook realized this and decided to enter this new industry. Even ten years ago, Facebook issued a virtual currency called 'Facebook Credit'.
‘Facebook Credit’ could be used for purchases of games played on Facebook or apps used. At the time, one dollar was getting ten Facebook credits. However, ‘Facebook Credit’ has not been digested by users. There were two reasons for this. One is that Facebook was not as widespread in the world at that time as it is today, and the other is that the concept of virtual currency did not become popular until then. Today both of these obstacles have been overcome.
Government's big decision regarding cryptocurrency? Companies will have to disclose the transaction
The discussion of Kripto currency like Bitcoin is in full swing nowadays. In India too, the government is being sought to issue clear guidelines on this. Meanwhile, the government has said that companies will now have to disclose transactions in their cryptocurrency. The government has implemented stringent disclosure requirements to improve transparency.
The Ministry of Corporate Affairs has amended various rules relating to audits, auditors, and accounts in company law. Apart from the change in schedule three of the Companies Act 2013, disclosure requirements have been enhanced. It also includes details of the company's transactions in cryptocurrency.
The Ministry of Corporate Affairs implementing company law notified these changes on Wednesday. These changes were effective from April 1. A senior official said that if companies trade in cryptocurrency, there should be transparency in the matter. It should be informed how much money is made from such business activities.
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