Born in 2008, with the bitcoin being the first open-source and widely popular cryptocurrency, the fad associated with them seems to have died down. Theirs is a story similar to that of the California Gold Rush of 1840s when three lakh people from all over the United States of America gathered in California to mine newly discovered gold. Regulations for cryptocurrency in India grew harsher last year when the Reserve Bank of India banned the banks and all other regulated financial institutions from dealing with or settling transactions using virtual currencies like the bitcoin. This move was a major setback for the cryptocurrency players in India like Unocoin and Belfrics.
The critical behavior of the Government of India towards these digital assets is purportedly because of fear. Fear that stems from a limited or improper understanding of the latest technology because many nations around the world like the United States, Canada, and the European Union have legalized cryptocurrency and they have formulated relevant rules and regulations. India had acted indiscriminately in this regard. An outright ban neither resonates with the passionate and strong community of crypto dealers nor does it seem to stop or control it absolutely.
It is a misbelief that the ban would completely thwart Indians from dealing in virtual currencies and allay the purported fears of the Indian government. Indian authorities cannot understand that a ban only makes cryptocurrency punishable, with all the technical know-how, lucrative gains and the dexterity achieved by the crypto miners, and the decentralized nature of cryptocurrency, it cannot be eradicated, at least from the grey market. Miscreants would benefit from the ban as the dark heaven created after the ban would become their stage and the people they fraud would have nowhere to go in the absence of legal remedies. It is a consensus that cryptocurrency should be legalized with strong rules. California Gold Rush had brought doom for the native Indians as people brought deadly diseases and caused great conflicts.
Major players from the virtual currency market in India have changed their business model for survival. The cryptocurrency exchanges like Zebpay, WazirX, and Koinex have started crypto-to-crypto trade and customers now trade one digital currency for another at predetermined rates, the bourses get commissions from these transactions as their source of revenue. They deal with a shrunk customer pool but nonetheless continue to remain afloat in the choppy waters.
Cloud mining is another option being exploited by the miners. In cloud mining, the computing power of remote servers is used to mine the cryptocurrency. It is a very convenient option for miners especially in India because they eliminate the need to maintain any costly hardware or be wary of the looming regulation of the Reserve Bank of India. The hardware is a headache of the cloud mining service provider, they house the mining rigs, and take care of all the associated risks and doubts. A customer is required to register with the cloud mining company and purchase the mining contracts or shares. The prices of cloud mining seem expensive to some and they feel discouraged to avail the service not realizing that the cost of cloud mining may result in lower returns according to the miner, but there will still be returns in a hassle-free environment and at a greater level of personal comfort. Cloud mining gives miners the option to choose a physical or a virtual private server. Some companies offer hashing power in GigaHash per second.
Although mining isn’t the only way to earn cryptocurrency, it is the most feasible, and rewarding method. One can use fiat money (Rupees, Dollars, Euros, etc.) to buy cryptocurrency, post a blog on a platform that pays in cryptocurrency or play a video game to earn it. Relating the life story of the cryptocurrency to the California Gold Rush, it’s time to point out the positive impact the gold rush had on the state- with the great influx of labor; agriculture developed and became a majorly profitable enterprise in California! Cryptocurrency is here to stay, it is better that the Government of India educates itself, allay its fears, and deals with the matter in a more prudent manner because technophobia is not a solution in the modern times.