Site Loader

ABSTRACTThe first search result that poppedup when we typed ‘bitcoin’ in Google’s search bar was a currency conversiontool showing the Indian Rupees equivalent of the value of bitcoin in real time.Clearly, this is what majority of people are searching for right now. One mighthave thought that the first search result would be a description of thecryptocurrency and its history but that is old hat now.

Finance minister ArunJaitley and the Reserve Bank of India might be advising people to avoid thisnew entrant but people are clearly not listening. Something that most peoplehad not even heard about till say two years ago is now a chart buster – thefastest growing ‘startup’ of all. Here is another interesting trend. Accordingto Google Trends, number of searches for ‘bitcoin investing’ had overtaken’stock investing’ between November 26 and December 2. INTRODUCTION WHAT IS BITCOIN?Bitcoin is acryptocurrency which can also becalled as a type of digital currency. It was founded in the year 2009 by”Satoshi Nakamoto”whose real identity is still a mystery. There are Bitcoinwallets available on Internet just like Paytm wallet and other wallets that weuse online. Although no cryptocurrency has any physical presence still Bitcoinscan be used to buy items online on websites that accept cryptocurrency as apayment method.

Best services for writing your paper according to Trustpilot

Premium Partner
From $18.00 per page
4,8 / 5
4,80
Writers Experience
4,80
Delivery
4,90
Support
4,70
Price
Recommended Service
From $13.90 per page
4,6 / 5
4,70
Writers Experience
4,70
Delivery
4,60
Support
4,60
Price
From $20.00 per page
4,5 / 5
4,80
Writers Experience
4,50
Delivery
4,40
Support
4,10
Price
* All Partners were chosen among 50+ writing services by our Customer Satisfaction Team

Even big companies like Dell and Microsoft accept bitcoins. Onecan install the Bitcoin wallets on mobile or computer, the wallet will generatean address that can be used for receiving bitcoins from anyone on theInternet                                                                            BUZZWORDS IN BITCOINWORLD CRYPTOCURRENCY:         A digital currency that relies oncryptography to validate and secure transactions. There are different types ofcryptocurrencies.

Bitcoin and ethereum are among the best known.BLOCKCHAIN:                     Also  known as distributed ledger technology (DLT),it is a shared record of information that is maintained and updated by anetwork of computers rather than a central authority.                                                                                MINING:                                  The processthrough which transactions are verified and added to the blockchain and newbitcoins are created.                                                     PUBLIC LEDGER:                  A distributed ledger that isopen to everyone on the internet. Bitcoin’s blockchain is a public ledger.                                                          PERMISSIONED LEDGER:    A   distributed ledger that needspermission to access. It is maintained only by a limited number of parties.

This is the kind of blockchain tech that large corporations, such as banks mayuse due to data privacy needs.                                                ALTCOIN:                                   Analternative cryptocurrency to Bitcoin.DIGITALWALLET:                 Software that allows users tomake electronic payments, purchases and store their cryptocurrencies online.

PRIVATEKEYS:                        A form of cryptographythat allows users to access their cryptocurrency and is an essential part ofits security. SMARTCONTRACTS:            Software that runs on blockchaintechnology and can automatically enforce the terms of an agreement. A “smartbond,” for example, would automatically make interest payments to investors.ICO:                                           Initial  Coin Offering, or a tokensale.

This is the process or event in which funds are raised for a newcryptocurrency venture and contributors receive tokens in return.HARDWARESECURITY MODULES (HSM):  It is a device that secures data such asdigital private keys in a very secure fashion. Sources: Investopedia,Blockgeeks, Blockchaintechonologies.comETHEREUM:                         It is Bitcoin’s top rival. Both the blockchains differ primarily inpurpose and capability.

While Bitcoin blockchain is used to track ownership ofdigital currency Bitcoin, Ethereum blockchain can be used to build apps.BITCOINCASH:                      An alt-coin clone of bitcoin that was created in August 2017 when agroup of Chinese miners initiated a fork of bitcoin’s blockchain.HASHRATE:                            The speed of a bitcoin transaction.                                                                                                                                                       BITCOIN TRANSACTIONS Oneinteresting fact about Bitcoin is that no single entity or government controlsbitcoins. One can buy or sell even sub-units of bitcoin, 1 Bitcoin is equal to1,000,000 bits, bit is a subunit ofBitcoin.Now, youmust be wondering how the records of the bitcoin transactions are kept to checkif there is any fraud or anything else.

Bitcoin works on the blockchain technology which is a publicledger. Any bitcoin transactions done by users on the internet gets recordedinto this public ledger. For the maintenance of this ledger, mining is done inwhich users provide the energy of their supercomputers which helps in doingcalculations for this ledger. These users get bitcoins for providing computers.

The only information anyone will see in the public ledger is user’s Bitcoinwallet address. This ensures anonymity of the user. One negative of bitcoin isthat its transactions can’t be refunded.                                                                                                              HOW TO GET BITCOINS?One can buy Bitcoin usingthe ‘real money’. Bitcoin price is about $10,000 right now.

Another method ofgetting Bitcoin is let people pay you in form of Bitcoins for any service orproduct online. The third way of getting Bitcoins is giving your supercomputerfor mining.RBI REITERATESWARNING ABOUT USING BITCOINS AND OTHER VIRTUAL CURRENCIESThe ReserveBank of India has reiterated caution against the use of virtual currencies likeBitcoins. On Tuesday, 5 December in a press releasethey emphasized the risks again for the third time. The ReserveBank of India warned the users, holders and traders of Bitcoins and otherVirtual currencies like litecoins, bbqcoins, dogecoins etc. first on 24December, 2013 when virtual currencies were still a growing community.

The RBI haddeclared that it gives no regulatory approvals, registration or authorisationto the Virtual Currency system. The persons using VCs are vulnerable tofinancial, operational, legal, customer protection and security related risks.In the press releaseof 1 February, 2017, RBI repeated the caution referring to the previous one. Recentlythere has been a “wake of significant spurt in the valuation of many VCs andrapid growth in Initial Coin Offerings (ICOs)”, where Bitcoin soared up to arecord high of $11,800 on 3rd in this month . RBI mentioned by Jose J.Kattoor, the Chief General Manager that the current situation calls for areiteration of the warnings.

CONCERNS RELATED TO BITCOINS?       As the Bitcoins are storeddigitally, the wallet is subject to losses arising out of hacking, loss of password,compromise of access credentials, malware attack, and since there is noregulatory authority present, loss of the wallet for any reason, could bepermanent and irretrievableForthe same reason of absent central authority, customer problems and disputeswill be unresolved, leading to probable loss of wealth.?       Volatility in value could harm theusers’ interests.?       Lastly, there is the threat ofviolation of Anti Money Laundering and Combating The Financing of Terrorism.Media reports say that illicit activities are funded by the Bitcoins, and inthat case, some users could unknowingly get involved.However, the central bank is currently studying the usage ofvirtual currencies under the extant legal and regulatory framework inIndia, including Foreign Exchange and Payment Systems laws and regulations.

BLOCKCHAINFOUNDATION OF INDIA  After themassive surge in its price, Bitcoin is becoming mainstream in India. Eventhough financial industry regulator Reserve Bank of India (RBI) has issued several warningsabout the cryptocurrency, that doesn’t mean that it is not catching the fancyof investors in India. And courtesy that, a new initiative has been launched inthe country called the Blockchain Foundation of India (BFI). It is a community effort to promote the growth ofblockchain-based initiatives in India. According to the organisation, the aim of BFI is to connect allblockchain-based startups, tThe executive members of BFI are a blockchainstartup named Velix.ID, Bitcoin exchange in India called CoinSecure, and astartup working to promote the startup culture in India, OneCo.Work.  Members of BFI are Vishnu Chandra – deputy director general with NationalInformatics Centre, Padmaja Ruparel – president of Indian Angel Network,Himanshu Bindal – founder of OneCo.

Work, Mohit Kalra – CEO at CoinSecure, ManavSinghal – co-founder at Velix.ID, Arun Mittal – director at Exide Industries,Nilesh Gopali – country head for Cloudbuy, Ashutosh Chadha – group director at Microsoft India, Kunal Patel – advisor at YesBank, Satendra Singh – head of strategy and business development at Nokia, Dipankar Chakrabarti – executivedirector at PwC. Commenting on the launch, Manav Singhal from Velix.ID said, “Blockchain isthe future of technology itself. We have a lot of talent working withblockchain in India; what we truly needed was a platform to collaborate andencourage.

Through the BFI platform, we will be able to accelerate the growthof blockchain technology in India remarkably.” According to the company the goal of BFI is three-fold: Firstly, to createawareness about the blockchain technology in a more Indian context. Secondly,to build a unified community to advocate for improved blockchain reception inIndia. And lastly, to accelerate Blockchain growth by making innovations in theblockchain sphere. heir CXOs, blockchain enthusiasts and government bodies at aone platform to collaborate.

BITCOIN SCAM ININDIA Gang ofcrooks floated a fictitious cryptocurrency, put up a website and duped severalpeople in Delhi and other parts of the countrybefore crime branch got on their trail and arrested a key player. The accused,Narendra Dahiya, hails from Sonipat. Eight other members of the gang have beenidentified and raids are being conducted to nab them. Joint commissioner (crime) Alok Kumar said more arrests were likely in thecoming days.

Explaining their modus operandi, Kumar said the gang had named the”currency” Kashhcoins and put them up for sale on its website —Kashhcoin.net. They devised a unique combination of cryptocurrency andmulti-level marketing to make huge profits. They asked each buyer to add theirfamilies, relatives and friends in the chain to earn profits. For every newmember added, they were promised incentives over and above their profit.On their website, the companyclaimed to provide “all residents of earth” with sufficient number ofcoins to achieve independence from other money. “There is a finite numberof KASHH Coins. The maximum amount of KASHH Coin is 2,515,020,000 and, unlikemoney issued by government, KASHH Coin can’t be affected by inflation and areimpossible to counterfeit (sic),” the website says.

 The website also had a disclaimer for indemnity and used complex legallanguage. The gang promised a return of 10% for five years to their buyers,apart from the “shooting rate” of the cryptocurrency, which theyclaimed would soon cross the rate of Bitcoin. The initial price of eachKashhcoin was Rs 3.5. Cryptocurrencies sold by the gang were valued at Rs 50 crore.

One of the buyers, Arun Chauhan, smelled a rat and tipped off Delhi Police’scrime branch. Chauhan was duped of Rs 14 lakh, he claimed. Cops filed an FIR inAugust and raids were conducted in Maharashtra and Gujarat to nab the suspects.During this time, more complainants poured in. A team, led by ACP Sandeep Lambaand inspector Sandeep Malhotra, managed to track down Dahiya in north Delhi.BITCOIN HITSALL-TIME HIGH NEAR $8000 Bitcoin hit an all-time high just below$8,000 on Friday; on talk that software upgrade whose suspension sent the cryptocurrency into a tailspin at the end of last week was, after all,going ahead within hours. Talk that the upgrade – which could split or “fork” bitcoin into twoversions – would go ahead was driven by a statement on the website of Coinbase, the world’s largest bitcoin company with operations in 32countries. “The Bitcoin Segwit2x fork is expected to occur in the next sixhours,” it said in a statement published at 1004 GMT.

If a bitcoin clone were created, any holders would also in theory instantlybecome owners of the new spin-off. Bitcoin, generally highly volatile, has been on a particularly wild ride,sliding at the end of last week to as low as $5,555 after plans for Segwit2xwere suspended, before bouncing more than 40% since Sunday. It reached as high as $7,997 in early Asian trading on the Luxembourg-basedBitstamp exchange, before easing back a touch to trade broadly flat by 1115 GMTat $7,863. Market-watchers said speculation about the fork was driving bitcoin higher. Ifit went ahead as expected, holders of the cryptocurrency would be able to sellthe spin-off at a profit if the market were to assign it any value. But in a post on the Medium blogging platform, the company’s communicationsdirector David Farmer said Coinbase did not expect thefork to successfully split bitcoin in two, as it lacked the necessary supportfrom the network to do so.

“Whenever people hear ‘fork’nowadays the price jumps, as people hope to get the free dividend,” said Charles Hayter, founder ofcryptocurrency data analysis site Cryptocompare. “There is also a resulting spike in demand for people entering bitcoin”from other cryptocurrencies. Farmer said the company was actively monitoring the situation and that allfunds stored in Coinbase wallets remained safe. All bitcoin buying and sellingwould be suspended on Coinbase in the hour prior to the fork, which is expectedbetween 1400 and 1600 GMT.

Bitcoin ison track for its best week since July. For the year, it is up more than 700%.BITCOIN ON TRACK TOHIT HIGHEST VALUE OF $10,000 With the cryptocurrency soaring toanother record high just a few percent away from $10,000 after gaining morethan a fifth in value .The digital currency has seen an eye-watering tenfoldincrease in its value since the start of the year and has more than doubled invalue since the beginning of October, lifted by the prospect of crossing overinto the financial mainstream, amid a flurry of crypto-hedge fund launches. It surged as much as 4.5% on Monday to trade at $9,721 on the Luxembourg-basedBitstamp exchange, before easing back to around $9,600 by 1155 GMT. Data compiled by Alistair Milne, the Monaco-based manager of the Altana Digital Currency Fund, showed U.S.

bitcoin wallet provider Coinbase added 300,000 users betweenWednesday and Sunday, during the U.S. Thanksgiving holiday. The total number ofCoinbase users globally now stands at 13.3 million. “The Coinbase data is evidence that adoption is not slowing down,”Milne told Reuters. “Breaking $10,000 seems inevitable following therecent price action.” Bitcoin’s price has been helped in recent months by the announcement that theworld’s biggest derivatives exchange operator CME Group would start offeringbitcoin futures.

The company said last week the futures would launch by the endof the year though no precise date had been set. So far, institutional investors have largely stayed away from the market,viewing it as too volatile, too risky and too complex to invest other people’smoney into. But some say the launch of the CME futures could lure in moremainstream investors. “Promises of bitcoin futures opening the door to institutional money aresupercharging the price,” said Charles Hayter, founder of cryptocurrencydata analysis website Cryptocompare.

BIGGERTHAN WAL-MART The latest price surge broughtbitcoin’s “market cap” – its price multiplied by the number of coinsthat have been released into the system – to more than $163 billion, accordingto industry website Coinmarketcap. The market cap of all cryptocurrencies, meanwhile, topped $300 billion for thefirst time, the site said, making their estimated market value greater thanthat of Wal-Mart. The staggering price increases seen in the crypto-market have led to multiplewarnings from central bankers, investment bankers and other investors that ithas reached bubble territory.

Some say that this could prompt regulators in the West to crack down on themarket in a similar fashion to China, where bitcoin exchanges were shut downearlier this year. “Regulators know the rewards of cryptocurrency and blockchain could behuge but (they) have more than one eye on the catastrophic ramifications if goodgovernance, stability and control are not preserved,” said David Futter, afintech partner at law firm Ashurst, in London. “If the carrot ofself-regulation proves insufficient, the regulators will not hesitate to usetheir stick.” Bitcoin’s biggest rival, ether – sometimes referred to as Ethereum, the namefor the project behind it – has seen even more stratospheric gains this year,up more than 6000%. It hit an all-time high just below $500 on Monday, with itsmarket cap nearing $50 billion.BITCOIN BLOWS PAST$16,000, ALARM BELLS RING LOUDER Bitcoin rocketed to a lifetime high wellabove $16,000 on Thursday after climbing some 67 percent over one week,intensifying the debate about whether the cryptocurrency is in a bubble aboutto burst.

The largest US cryptocurrency exchange struggled to keep up with record trafficas the price surged, with an upcoming launch of the first bitcoin futurescontract further fueling investor interest. Proponents say bitcoin is a good medium of exchange and a way to store value,much like a precious metal. They also argue it is preferable to traditionalcurrencies because it is not subject to central bank manipulation. The supply of bitcoin will eventually be capped at 21 million, and some 16.7million have already been released .But critics say that the price run-up is abubble that has been driven mostly by speculation, leaving bitcoin vulnerableto a sharp reversal. JPMorgan Chase & Co Chief Executive Jamie Dimon famously called bitcoin a fraud inSeptember. “Bitcoin remains a major gamble as it is very much an asset that remainsin uncharted waters, we’ve simply not experienced this before,” said NigelGreen, founder and chief executive of deVere Group.

“Also, an asset that goes almost vertically up should typically raisealarm bells for investors,” he added. The world’s biggest cryptocurrency has surged seventeen-fold in value so far thisyear. The latest move brought its so-called market cap, its price multiplied by thenumber of bitcoins in circulation, to nearly $305 billion, according toCoinmarketcap, a trade website.

By comparison, the market value of Wal-MartStores Inc is around $288 billion. Analysts said the launch slated for this weekend of bitcoin futures by CboeGlobal Markets Inc’s Cboe Futures Exchange, one of the world’s biggestderivatives exchanges, was helping drive up the price on expectations it woulddraw more investors to the market. The CME Group will launch bitcoin futures one week later, while Nasdaq Incplans to get into the mix next year.

It is not clear to what extent big U.S. banks will participate in the newbitcoin-related activity. Goldman Sachs Group Inc will clear bitcoinfutures for certain clients when they go live, a spokeswoman said on Thursday. The bank is “evaluating the specifications and risk attributes for thebitcoin futures contracts as part of our standard due diligence process,”spokeswoman Tiffany Galvin said. Bitcoin climbed as high as $16,615.62 on the Luxembourg-based Bitstampexchange, up nearly 22 percent on the day.

It was last at $16,607.14. Coinbase, the largest U.S. platform for buying and selling cryptocurrencies,said on Thursday on Twitter that it had experienced an outage due to recordtraffic.

The venue was last up and running. Some investors said they still see scope for bitcoin to soar even higher. “It will hit potentially $20,000 because so much capital is coming in andit’s the most liquid secure coin out there,” said David Drake, founder and chairman of DLJCapital, a family office in New York. Other trading venues showed different prices for bitcoin, which trades in morethan 100 cryptocurrency exchanges that are not accountable to any centralauthority.

For instance, at institutional trading platform GDAX, bitcoin topped$19,000, while it hit above $16,000 at its Bit. BITCOIN SURGES ABOVE $15,000: RBI HAS 6 WARNINGS FOR YOURBI has not given any licence/authorisation to anyentity/company to deal with Bitcoin or any other virtual currencyBitcoin is prone to hacking and malware attacksNo legal recourse in case of Bitcoin fraudBitcoin value is based on ‘speculations’Bitcoin exchange platforms are set up in jurisdictions whoselegal status is unclearBitcoins are used for illegal and terrorism activities RBI hasconstituted a group to look at the possibility of having a government-backedcryptocurrencyCONCLUSIONThe rising craze for bitcoin, acryptocurrency that has rocketed to shocking highs, has come under thegovernment’s lens. The government has begun a crackdown on illegal uses of thisunregulated virtual currency. Widening its probe into bitcoin investments andtrade, the Income Tax (IT) department is set to issue notices to 4 to 5 lakhhigh networth individuals (HNI) across the country .In addition to financialrisks the value of bitcoins has seen huge falls within hours the regulators areworried about their use for illicit and illegal activities, subjecting theusers to an unintentional breach of laws against money laundering and terrorfinance. The jury is still out on whether such virtual currencies should beallowed as legal payment tender or investments, though there are alsosuggestions from some quarters for allowing them with necessary checks andbalances.

  

Post Author: admin

x

Hi!
I'm Dora!

Would you like to get a custom essay? How about receiving a customized one?

Check it out