[Answered] ““By imposing a blanket ban on cryptocurrencies India may miss out on one of the biggest technology revolutions since the Internet.”. Discuss.

Demand of the question
Introduction. Introduce with cryptocurrency and blockchain.
Body. Potential benefits of blockchain technology. Conclusion. Way forward.

A cryptocurrency is a virtual currency used for financial transactions. It uses blockchain technology for various transactions. The Banning of Cryptocurrency and Regulation of Official Digital Currency Bill, 2019 has proposed stringent provisions for holding, selling or dealing in cryptocurrencies. This may lead to India missing on blockchain technology which has many potential.

Potential Applications of biotechnology:

  1. Financial Services: Blockchain is cheaper, more transparent, and more effective.
    • It can be used to expedite payment processing and money transfers.
    • Blockchain networks can be used in equity trading to validate and settle transactions quickly.
    • It simplifies the process by canceling the need for intermediaries.
    • The blockchain provides a system for risk-free management and transparency in insurance sector.
    • Blockchain can also be used to monitor supply chains.
  2. Real estate Sector: Registration can be stored on the ledger along with contractual details and access would be provided to the permitted party only. It decreases risks of fraud and benami transactions.
  3. Security: With billions of devices linked together, information security is a challenge. The blockchain technology can provide security by keeping information encrypted.
  4. Healthcare:
    • Personal health records could be encoded and stored on the blockchain with access to specific individuals.
    • It can also be used for general health care management, such as supervising drugs, regulation compliance, testing results, and managing healthcare supplies.
  5. Entertainment industry: The blockchain and smart contracts technology can solve issues of ownership rights, royalty distribution, and transparency of film makers by creating a comprehensive and accurate decentralized database.
  6. Agriculture: The blockchain provides a big database which can be used by farmers to perform precision farming.
  7. Governance:
    • The blockchain technology can expedite process of passport generation.
    • The blockchain could make record-keeping more reliable. Eg By encrypting birth and death certification and empowering citizens to access this crucial information it can reduce inefficiencies.
  8. Policy formulation and implementation:
    • Database generated by blockchain technology can be used by governments to target weaker section and implement better policies. This will reduce leakages and reduce government expenditure.
    • Blockchain can also be used to for tax compliance. For example, companies can use blockchain as a means to record their sales. This can be used as a record for their tax compliance and can be used by tax authorities to track any tax offence.

It is important to note that blockchain technology has many potential benefits which India may miss with a blanket ban. Need of the hour is to study impact of cryptocurrency on various sector and formulate a tight regulation framework to ensure its transparent use.

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