Published: Thu, February 01, 2018
Finance | By Claude Patterson

Govt To Adopt Blockchain Technology Popularised By Cryptocurrency

Govt To Adopt Blockchain Technology Popularised By Cryptocurrency

This is despite repeated warnings from the country's central bank, the Reserve Bank of India (RBI), about the risks of trading in cryptocurrencies. It was also said that the Indian government will look into the utilization of the blockchain technology.

Recently, a hacker stole more than $150,000 in etherum, another popular cryptocurrency, by tricking people to participate in a cryptocurrency Initial Coin Offering (ICO) pre-sale.

Commenting on the budget, Praveen Kumar Vijayakumar, Chairman and CEO Belfrics Global stated, "As expected, the government has not changed its stance on the trade of cryptocurrencies in India".

Last month, India's income tax authorities said they sent notices to tens of thousands of people dealing in cryptocurrency such as Bitcoin after a nationwide survey revealed transactions of more than $3.5 billion over a 17-month period. "The price of bitcoin and other VCs therefore is entirely a matter of mere speculation resulting in spurt and volatility in their prices", the finance ministry said last month.

At the same time, Jaitley indicated that the government has a different attitude toward the blockchain technology that underpins cryptocurrencies and can be used for a variety of other purposes.

He basically reiterated what the Government said earlier. In addition, the government has recognized the viability of block chain technology that powers cryptocurrency. At the time, rumours were circulating about a possible government panel preventing the use of digital currencies in India.

The central bank, which is apparently uncomfortable with the non-fiat nature of the conventional virtual currencies, is already said to be looking at the possibility of a fiat cryptocurrency that can become the digital counterpart of the Indian rupee.

DD Mishra, research director at Gartner, says that the government should regularise the cryptocurrencies.

"The announcement on the crypto currency by the FM should not be misinterpreted to mean the cryptocurrency is going to be discouraged by the government. The intention is more likely to regulate the circulation to avoid its use for illegal transactions", Rashmi Deshpande, associate partner, Khaitan & Co, told IBTimes India, in an email statement. Bitcoin is one of the most popular cryptocurrencies. It also states that it will crack down on individuals and bodies which might use crypto for illegitimate activities (like terrorist funding).

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