Not a year have passed and we have been destined to once again dip into the labyrinth of money. Can we ever forget the demonetisation which came something like a horrifying dream come true when we woke up on the morning of 8th November last year? Grace to the public awareness and the unending support of the government which helped us to sail our ship from the harrowing ocean of demonetisation. And remember we are still not a paperless economy. Indian economy now has a new challenge in the form of an opportunity or vice versa. Satoshi Nakamoto, a Japanese unknown programmers coined a new money “Bitcoin”. Thanks to the media and those agencies which are working hard day and night to make us believe that it is the “Currency of the Future” whose neither past nor present is significantly visible!
Well, we are not here to scare you. we want to present the other side of the coin for Indian policy makers who otherwise wakes up Laye as usual to face such emergencies. Amidst these confusion and mystery, The Policy Times tries to have a look on the potential policy concerns of this emerging cryptocurrencies for our policy makers –
- Bitcoins Are Not Widely Accepted: Used by just few online merchants make it unfeasible to completely rely on Bitcoin as currency.
- Wallets Can Be Lost: A corrupt hard disk or a malfunctioned program or virus is enough to make a wealthy person bankrupt in few seconds.
- Fluctuation of Bitcoin Valuation: The constant fluctuating value of Bitcoin gives birth to a large number of questions which puts a question itself on the Bitcoin.
- No Buyer Protection: The interests of the buyer are compromised due to the complex nature of Bitcoin.
- Risk of Unknown Technical Flaws: An emergence of unknown technical flaw at any stage could disrupt the whole mechanism.
- Built in Deflation:- The capping at the total number of Bitcoins will give birth to deflation
- No Physical Form: The absence of physical form of currency would force its’ transformation in a more universal form.
- No Valuation Guarantee: Absence of a central governing authority will witness major problems in its’ valuation.
- Legal Issues in Various Countries: Bitcoin is still to get legal clearance in lots of countries.
- Lack of Awareness: The lack of awareness will give birth to the exploitation.
- Limited Amount of Coins: The limited number of coins will give rise to hoarding and monopoly which in turn will disrupt the market.
- Lack of Government Intervention: The minimal role of government will give rise to criminal activities and money laundering on a major scale.
- Lack of Stability: The volatile nature of Bitcoin makes its’ almost impossible to be a stable currency.
- Threat to Existing Economy: The declining economy of various countries will find a further dip in their economy.
- Lack of Underprivileged Sections’ Participation: The mandatory use of Internet will make it an Utopian dream for the underprivileged sections of the society who have no access to the internet.
Before such a currency with endless flaws becomes very popular which is not directly going to benefit the common masses, policy makers should give a serious introspection to address them.