Cryptocurrency is a digital currency created and managed via online mode by a process called mining. Mining is a process that requires powerful computers to solve complex algorithms and crunch numbers. It mainly works on blockchain technology which keeps all transactions secure and safe. This form of currency is stored in a digital wallet online, on computers or other software.
Since cryptocurrencies are decentralized, they are not regulated by any government or central bank. It can neither be created nor destroyed by any government. Blockchain technology governs the whole transaction and each user is guaranteed high levels of security. No one has the authority to freeze, charge or demand your currency. So, there is no third-party interference.
Cryptocurrencies cannot be stolen, and the government cannot seize them in any condition. It is feasible to send to any nation on the planet and, like the email and internet, has no geographic limitations. It facilitates people to send and receive digital money anytime from anywhere and with no restrictions protecting its users' rights. Many countries around the world approve of cryptocurrencies as legal ones. The right to make payment is the most significant benefit cryptocurrency investors gain from participating in the trading market.
On the other hand, cryptocurrency prices are highly volatile, rising and falling at rapid rates. It has cybersecurity issues too. Speculators want to profit from it, but genuine investors see it as dangerous. That is the major issue with cryptocurrency. One of the most considerable drawbacks of investing in cryptocurrencies is the lack of regulatory oversight. Cryptocurrency laws and taxes differ from country to country and are often ambiguous. A lack of regulations, unfortunately, can lead to scams. Even though it has some imperfections, it will become our future.
At present, the Central government is working towards introducing the Cryptocurrency and Regulation of Official Digital Currency Bill, 2021. The RBI has been given the green signal to use cryptocurrency's underlying technology to issue digital currency. By implementing specific alterations, cryptocurrency can become the new conventional financial system in the future.
