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  • Analysis of the Cryptocurrency Industry in India

    Cryptocurrency is creating a lot of buzz these days. It is getting popular and gaining acceptance at various levels. In India, cryptocurrency cannot be labelled as completely legal or illegal. It is kind of a grey area. So, analyzing the cryptocurrency industry in India becomes crucial.

    In this article, we will discuss about cryptocurrency industry in India. We have brought you the cryptocurrency market insights, legal issues, and its future in India.

    So let’s begin…

    “Bitcoin is exciting me because it shows how cheap transactions can be” -Bill Gates

    What is Cryptocurrency?
    Analyzing the Crypto Industry in India
    Is Cryptocurrency Legal in India?
    Future of Cryptocurrency in India

    What is Cryptocurrency?

    Cryptocurrency is a decentralized digital currency based on a blockchain platform that has been named crypto as it verifies transactions through encryptions. However, it is not any normal digital currency that you may use to pay your bills.

    There are two major differences. First, it is decentralized i.e. it is not controlled by any government or third party. This means that all the transactions are made independently not relying on banks. Thus, the value of cryptocurrency does not get affected due to any geopolitical problem.

    Second, it is only available in a limited amount i.e. the amount of crypto of any particular cryptocurrency is predetermined. It will never change. For example, the limit for bitcoin is 21 million. So, there will always be only 21 million bitcoins in the world.

    Cryptocurrencies are generated through a process known as mining. Thereafter, they can be stored or spent through crypto-wallets. These wallets let you exchange crypto for any particular currency. They also allow you to make payments at places where cryptocurrency is accepted.

    Some people like Bill Gates and Elon Musk support cryptocurrency. As per them, it is much better and more secure than physical money. Also, it holds great value for the future.

    On the other hand, some people like Warren Buffett and Ajay Banga, consider it a bane to the world economy. They feel that cryptocurrency is the platform for criminal activities.

    This actually makes us think is it actually a safe platform? This is especially important when no government or bank is involved for guarantee.

    So, let’s take a look at its safety measures.

    The transfer or purchase of cryptocurrency is guarded by cryptography. This means that advanced coding is used to safeguard the storage and transaction data. Thus, it is almost impossible to hack this currency. This makes crypto quite a secure platform.

    Moreover, blockchain technology maintains distributed ledgers across a network of computers. The records of transactions are automatically updated in the systems of currency holders. This enhances traceability and visibility.

    Anyways, cryptocurrency is not a tangible asset. However, it can be called a digital asset. Its applications are still being explored and expanded in financial terms.

    Crypto charts represent the price history, volumes, and time intervals of the digital currencies, in graphical format. These are meant to help investors in making better decisions by picking equities and commodities.

    Usually, a chart known as the Japanese candlestick chart is used by crypto traders. The colour, shape, and size of the candles in the chart are used as indicators. For example, a red candle is an indicator that the closing price was lower than the starting price. Similarly, a green candle represents that the closing price was higher than the starting price. The specified time frame is demonstrated in the graph.

    Analyzing the Crypto Industry in India

    As per a report by the Economic Times almost 20 million people invested in cryptocurrency in India, in 2021. Currently, Indian investors hold cryptocurrency worth about $5.3 billion.

    The bitcoins touched their all-time highs in 2021, touching a mark of $63,729 on April 3. This has encouraged many small investors from India to focus on cryptocurrency. If the experience and sources of these investors are to be believed, the future of money lies in cryptocurrency.

    Bitcoin was the first and most popular cryptocurrency, launched in 2009. It was later followed by other cryptocurrencies named Ethereum, Solana, Dogecoin, Polygon, etc.

    In India, CoinSwitch Kuber is the biggest cryptocurrency exchange platform. It has recently touched 14 million users and registered a rise of 3500% in the transaction volume. The leading exchange apps WazirX and BitBns have also witnessed a growth of 1735% and 849%, respectively.

    This data certainly speaks a lot in itself. The popularity of cryptocurrency is rising in India and appears to keep rising in the future as well. Also, owing to more number of buyers the demand for cryptocurrency is increasing. This has led to a several-fold hike in its price.

    The cost of a bitcoin was about $0.008 – $0.08 in 2009 when it was launched. However, the present cost of a bitcoin is about $40,0000. Further, looking at the pace at which its value is increasing, more people are turning towards this form of investment.

    Bitcoin Price
    Bitcoin Price

    On April 6, 2018, RBI imposed a ban on trading in cryptocurrency. However, on March 4, 2020, Supreme Court quashed this ban. Post this decision, RBI has taken back its earlier circular and has urged the banks to follow the decision of the apex court.

    The Reserve Bank of India is responsible for managing currency and money transfers in the country. So far, the bank has supported the ban on investment in cryptocurrency. As per RBI, these investments would adversely affect macroeconomic stability.

    As per RBI Deputy Governor, T Rabi Sankar, cryptocurrencies do not pass the basic scrutiny. Therefore, it will never be legalized in India. On the question of advanced economies not banning crypto, he said, most cryptocurrencies are valued in dollars and thus, do not pose any threat to convertible currencies of these countries. However, some people refer to it as the statist approach. It is assumed that if private cryptocurrencies are launched in India, RBI would lose the hold.

    Presently, RBI is also set to launch their Central Bank Digital Currency (CBDC) in 2022-23. It will be a digital legal tender issued by the Central Bank. It will be the same as fiat currency, only in a different form. It will be exchangeable with fiat currency.

    In Union Budget, 2022, cryptocurrency was given legal sanction, virtually. While presenting the finance bill, Finance Minister Nirmala Sitharaman did not refer to crypto as a “currency”. However, she someway gave it a legal status by labelling it as “digital assets”.

    She has stated that this decision was taken in light of the phenomenal increase in the frequency and magnitude of transactions. This has ended the uncertainty over the future of cryptocurrency in India.

    A heavy tax of 30% has been imposed on the income generated through crypto transactions. Also, this tax cannot be claimed for deduction. In addition, to keep track of transactions 1% TDS will be charged on the payments made using digital assets.

    However, since this declaration, a number of questions have been raised. This is because the budget does not talk about regulations of crypto exchanges or investor protection. Also, how can government impose a tax without bringing the Cryptocurrency bill to legalize it?

    All-in-all, the government has still not cleared the legal status of cryptocurrency in India.

    Crypto Industry Market Size India
    Crypto Industry Market Size India

    Future of Cryptocurrency in India

    As per Purushottam Anand, Founder of blockchain law firm Crypto legal, “Taxing income from cryptocurrencies does not necessarily and explicitly legalize cryptocurrencies because income tax is not concerned about the manner or means of acquiring the income.” However, tax provisions for cryptocurrencies can be a step towards legalization.

    Prime Minister Modi, in his speech at the “Summit for Democracy” organized by the U.S in 2021 has stated that world leaders must jointly shape global norms for emerging technologies like social media and cryptocurrency. It would help in utilizing these to empower democracy.

    Also, while speaking at the virtually organized India-Central Asia summit, Prime Minister has urged a common approach to cryptocurrency.

    Further, the general approach of India is going with the majority. As the majority of countries especially advanced economies are favouring this innovation, it is expected that India too will legalize it in the future.

    Conclusion

    The investment in cryptocurrency has enhanced several folds in India since last year. Even though the legal status is still unclear, it appears that the investors are not bothered by it.

    Further, the cryptocurrency banning bill, due for the last winter session, has not been proposed by the government. Moreover, Finance bill-2022 has imposed a 30% tax on the income generated through crypto investment. This appears to be a good sign for the future of cryptocurrency in India.

    Overall, it can be said that although the cryptocurrency industry in India is expanding tailing uncertainties cannot be denied.

    FAQs

    Crypotuccureny is not a legal tender in India nor it is banned by the Indian government.

    Is crypto taxable in India?

    Yes, income from Crypto and NFTs are taxed at 30%.

  • Everything Marketers Should Know Before Advertising Crypto and NFT in India | Latest Government Guidelines for Crypto and NFT Advertising

    Cryptocurrency and NFT have taken the world by a storm in just a few years, people have started taking them seriously and are investing in them. They are said to be the new future of currency, Bitcoin announced its existence in the year 2009 and since then, a number of cryptocurrencies have launched. Although the future of cryptocurrency is uncertain, young people are not shying away to show their interest in them.

    At this age, there is hardly anyone who is not aware of NFTs and Cryptocurrency, they are becoming a medium of exchange and there are big companies who are accepting cryptocurrency as a form of payment.

    With so many new rules, regulations and states of NFT and Crypto, the status of them has changed. For any kind of product or service, advertising is one of the most aspects; if not the most important factors for letting the world know that they exist.

    Naturally, to make people more aware of cryptos and NFT and their features, advertisement is definitely going to be a strong need for marketing for all the business that is dealing with this industry.

    Cryptos somehow are able to get recognized and are not banned entirely in the country, but the advertisement of these products needs to follow some guidelines. In this article, we will talk about the guidelines that companies have to follow while advertising cryptos and NFT related things in India. So let’s get started.

    “A good advertisement is one which sells the product without drawing attention to itself.” –David Ogilvy

    The Advertising Standards Council of India (ASCI) as per the Government of India set some rules while advertising for Crypto and NFT related products as they are extremely risky. So people must be aware of the risks that they are going to take while investing in them.

    All these guidelines will be applicable to all the ads released on and after April 1, 2022, and not to forget ads that are not complying with the guidelines will not appear in front of the public after 15th April 2022.

    ASCI Guidelines Tweet
    ASCI Guidelines Tweet

    Some of the guidelines related to Virtual Digital Assets (VDA) are:

    • One of the disclaimers is “Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions.” It must be placed in every advertisement in such a way that it cannot be missed by anyone watching the advertisement.
    • If the advertisement is in print, then the disclaimer must be placed in a space that has to be at least one-fifth of the space in the bottom, the font has to be big and clear enough, that it can be read properly.
    • In a video ad, the disclaimer should be placed at the end and it must remain on screen for five seconds and the voiceover should be at a normal pace.
    • If the ad is an audio one, then it should be spoken at a normal pace at the end.
    • In social media advertisements, the disclaimer must be present in the caption as well as in the pictures and video attachments.
    • Several words are forbidden to be used in the advertisement of Crypto and NFT related products and services. Worlds such as, ‘Custodian’, ‘Currency’, ‘Securities’ and ‘Depositories’
    • Whatever information the advertisement of the products will provide to the consumers must not contradict the guidelines given by the Government of the country.
    • The past performance of any products shall not be included in any biased form in the advertisements.
    • The name and contact of the advertisers of VDA products and services advertisement must be clear in the advertisement so that a consumer can contact them if the need arises.
    • Advertisements must avoid making any kind of promise that states that there will be an increase in profit related to those products.
    • Minors are not allowed to be in the advertisements dealing with the products and services.
    • Ads must not be presented in such a way that it will show the consumers that while investing in them, one does not have to think twice.
    • Advertisements must not show that if anyone invests in the products, it will solve their money or personality problems.
    • Comparison with others assets must be avoided.
    • Any kind of celebrity, who is going to be present in the advertisement and endorse the products or services, must be very careful. They should avoid making any claims that can lead to a misunderstanding that may confuse the consumers.

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    Conclusion

    Cryptos and NFT related products status are quite uncertain in the country. All the guidelines by the ASCI are to protect the common people from facing any kind of uncertain future while investing in these products. By following these guidelines, the companies can advertise their products without any hindrance.

    FAQs

    Why were the guidelines released by ASCI?

    As to protect the investors from investing and losing money after watching misleading ads, ASCI released a few guidelines that every advertiser has to follow.

    Is investing in cryptos safe?

    Crypto is a highly volatile currency, so it is quite risky but it can be profitable as well.

    Can you run Facebook ads for crypto?

    You can run ads on Facebook but you have to follow the guidelines and get approval from the company.

  • Why did the Crypto Market Crash in 2021?

    We are at a time, where digital currency holds the utmost importance, in our life. Payment card, UPI, and now cryptocurrency, it seems like complete domination is inevitable.

    The digital currency has literally grasped the mind of people and the big stacks of notes may become obsolete in the future. In recent years, Cryptocurrency has somehow started gaining momentum, especially amongst the younger generation. So much is the craze that almost everyone is willing to invest some funds in them.

    Cryptocurrency at this point has been able to gather attention on itself from everyone. Some are already investing, some are speculating, and some are just watching it from the side. Whatever it is, the world’s eyes are on this, and it cannot be ignored anymore.

    The rising star suddenly got a bump in the road, this year in the month of May, Cryptos suddenly saw a great deal of decline, and the market got crashed. Again on the mid of September, the market crashed and somehow it has created tension.

    “As the value goes up, heads start to swivel and skeptics begin to soften. Starting a new currency is easy, anyone can do it. The trick is getting people to accept it because it is their use that gives the ‘money’ value.”

    – Adam B. Levine

    In this article, we will find out about the reasons for the crashing of the Crypto market. Before that, let’s find out about what Cryptocurrency is.

    What Is Cryptocurrency?
    The Reasons For Crypto Market Crash
    FAQ

    What Is Cryptocurrency?

    A cryptocurrency is a form of digital currency that is decentralized in nature, with the help of Blockchain technology that means it is not controlled by the government or any other mediator.

    It is the direct exchange of this digital currency between two people. People use this to buy goods and services but mostly they are used for investment. Most of the countries still haven’t declared it as legal tender.

    There are some common forms of cryptocurrency that are used in the world and they are:

    Cryptocurrency is readily redefining the future of finance sector in India
    Cryptocurrency or digital currency has a huge impact on Finance industry and it is helping it grow over and above. It is attracting attention all over the world
    StartupTalkyVibhavari Madki

    The Reasons For Crypto Market Crash

    As mentioned above Crypto market crash in the month of May and again in September of this year, the fluctuating nature of cryptocurrency is creating uncertainty amongst investors and others. There are a few reasons that can be identified to be the cause of the crashing of the cryptocurrency market.

    Elon Musk Denies Cryptocurrency

    In the month of March 2021, Elon Musk the CEO of Tesla, the most valuable car company announced that they are willing to accept the most popular cryptocurrency, that is Bitcoin as a payment method in the USA. With that, it was also said that they will try to introduce this payment method in other countries as well.

    The problem arises when Elon Musk declared in the month of May, that they will not allow any cryptocurrency as a method of payment, the main reason for this, they portrayed was the environmental issues. As bitcoin mining required a huge amount of electricity, it is not eco-friendly enough, this statement leading to 30% crashing of major cryptocurrencies like Bitcoin, Ethereum, and others.

    Elon Musk tweet about Tesla & Bitcoin
    Elon Musk tweet about Tesla & Bitcoin

    By the month of July, the market experienced a 50% dip, and that was quite a lot. Bitcoin faced a 35% plunge at that time.

    Bitcoin Price after Elon Musk tweet
    Bitcoin Price after Elon Musk tweet

    We can say that, although cryptos future seems great, but it not being environmentally friendly is causing it a great deal of concern. The news causes apprehension and over 8 lakh traders decimate their investment.

    China’s Ban On Cryptocurrency

    The reason for the crypto market crash in May was not only Musk’s Tesla but also China’s ban on financial and payment institutions of using cryptocurrency. All the popular ones like Ethereum, Cardano, and Dogecoin showed a dip of 15% to 20% after the major blow.

    China asked the institutions to refrain from providing services to those who are trying to get them by using cryptos and ordered banks to stop providing support to cryptocurrencies. China even instructs bitcoin has to close down its mining operation in Sichuan and like that it got shut down there.

    Even though this prevention did some damage to this digital currency market, in August the market saw a surge, and as per the report, the value rise above $2 trillion.

    The good weather didn’t stay good for a long time; China central bank permanently announced that any transaction done with cryptocurrencies is illegal and banned any type of virtual currencies use.

    As per them, it placed people’s assets in danger. China banned the trading of cryptocurrencies in 2019 but foreign exchange through online continued happening.

    This announcement of China in the month of September of 2021, put the last nail on the coffin of the crypto market in the World’s most populous country. Following this announcement bitcoin showed a 9% drop again.

    China was one of the top names in the crypto industry but this sudden move has plummeted the virtual currency business in the country, with that it has also destabilized the entire crypto market of the world.

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    Conclusion

    Although this fluctuating nature of cryptocurrency is turning people’s heads more towards into them but with industry giants like Tesla giving up and refraining from considering crypto coins as a method of payment is straining the virtual currencies presence in the market.

    Not to forget China’s ban on crypto is questioning the digital currencies’ entire authenticity because of that people are now being skeptical over-investing in them.

    FAQ

    What is cryptocurrency?

    Cryptocurrency is a digital currency that is decentralized in nature.

    Is Cryptocurrency Banned In China?

    China’s Central Bank termed all virtual currency transactions illegal, which is done by cryptocurrency from 24th September 2021.

    What is the reason for Cryptocurrency crash?

    Cryptocurrency crashed in may because Elon Musk denied purchase of tesla using bitcoins and later China banned all the cryptocurrency transactions.

  • Should You Invest In Cardano? | Cardano Investment Analysis

    Cryptocurrencies are digital currencies that are not backed by real assets. As a result, they are traded between willing parties without a middleman, and their transactions are recorded on digital ledgers.

    Investors from all over the world have equal access to the global crypto market, which is open 24 hours a day and 7 days a week. As a market that is only a decade old, it has the potential to grow by a factor of ten over the next few years. As the first blockchain platform built on peer-reviewed research and developed using evidence-based methods, Cardano is a proof-of stake platform. It combines cutting-edge technologies to provide decentralized applications, systems, and societies with unparalleled security and sustainability.

    About Cardano
    Features of Cardano
    What makes Cardano unique?
    Cardano’s Efficiency
    Cardano – Pros
    Cardano – Cons
    Should you invest in Cardano?
    Conclusion
    FAQs

    About Cardano

    About Cardano

    Cardano is a public, decentralized, and open-source blockchain platform.

    Cardano promotes peer-to-peer transactions with Ada cryptocurrency. Founded in 2015 by Ethereum co-founder Charles Hoskinson, Cardano strives to bring about a positive impact on the global world.

    The advancement of the undertaking is directed and managed by the Cardano Foundation situated in Zug, Switzerland.

    Although Etherum and Bitcoin are the dominating cryptocurrencies in the market today, Cardano has several advantages over both.

    Cardano was supported through an underlying coin offering.

    The money appeared with a market cap of $600 million. Before the finish of 2017, it had a market cap of $10 billion and arrived at a worth of $33 billion momentarily in 2018 preceding an overall fixing of the crypto market dropped its worth back to $10 billion.

    Features of Cardano

    Cardano Cryptocurrency
    Cardano Cryptocurrency

    Cardano addresses Bitcoin’s extreme energy consumption while challenging Ethereum’s fascinating smart contracts.

    Cardano plan standards planned to refine issues looked at by other digital currencies, like versatility, interoperability, and administrative compliance.

    Cardano uses a proof-of-stake convention named Ouroboros as opposed to Bitcoin and Ethereum which utilize confirmation of work protocols.

    Proof-of-stake blockchains utilize altogether less energy than evidence of work chains.

    In February 2021, Hoskinson assessed the Cardano network utilized 6 GWh yearly, under 0.01% of the 110.53 TWh utilized by the Bitcoin network as assessed by the University of Cambridge.

    Cardano is viewed as the greatest verification of stake cryptographic money in 2021.

    Inside the Cardano stage, Ada exists on the settlement layer. This layer is like Bitcoin and monitors exchanges.

    The subsequent layer is the calculation layer. This layer is like Ethereum, empowering brilliant agreements and applications to run on the platform.

    Cardano’s savvy contract language permits designers to run start to finish tests on their program without leaving the incorporated improvement climate or sending their code.

    What makes Cardano unique?

    Cardano strives to conquer the two main issues in the cryptocurrency market namely :

    1) Bitcoin is excessively lethargic and rigid.

    2) Ethereum is not secure or scalable.

    IOHK (Internet Online Hong Kong) declared an association with the Ethiopian government in 2018 to convey their innovation in an assortment of businesses all through the country.

    In April 2021, IOHK and the Ethiopia Ministry of Education reported designs to dispatch a character and record-saving framework on Cardano for the country’s 5,000,000 students.

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    Cardano’s Efficiency

    The huge edge for Cardano is its case for energy productivity.

    Cardano’s Ouroboros evidence of stake calculation is multiple times more proficient than Bitcoin’s mining framework.

    In energy utilization, Cardano’s greater rival is Ethereum.

    Ethereum isn’t fiercely energy-productive as things stand now.

    All things considered, Ethereum plans to move to a proof-of-stake calculation, like Cardano, that would immeasurably advance its position.

    Proof-of-stake sidesteps the figuring serious mining measure.

    Bitcoin and numerous other customary digital currencies utilize a proof-of-work convention.

    This is the place where miners utilize powerful design cards or trained computed gears to speculate convoluted numerical puzzles. Those with greater computing power win a greater amount of the riddles, and accordingly, get a greater amount of the mining reward.

    Rather than spending gigantic measures of processing power and natural assets to keep up the blockchain, verification of-stake conventions can utilize a digger’s tokens as the security that makes the framework work.

    Cardano’s Ouroboros was novel in being one of the primary fruitful confirmation of-stake conventions that made a practical choice to evidence of-work tokens. Evidence of stake has become so charming that even Ethereum may change to it in the coming months.

    “The client with the most marked digital currency will assemble the most blocks and get the most block award. On the off chance that they continually reinvest these rewards, they will have an always developing level of the stake and could ultimately control the whole stake,” Poston says.

    A few idealists demand that without verification of work, digital money doesn’t tackle a significant number of the decentralization issues it was expected to address.

    Be that as it may, with figures like Tesla (ticker: TSLA) CEO Elon Musk pushing energy utilization worries to the cutting edge, confirmation of stake just acquired a significant round of free exposure. What’s more, Cardano’s Ouroboros seems as though quite possibly the most convincing verification of-stake alternatives accessible.

    Cardano’s Ouroboros seems as though quite possibly the most convincing verification of-stake alternatives accessible.

    Cardano – Pros

    • Reliable team
    • Environment friendly
    • Peer-reviewed technology
    • Decentralized
    • Efficient

    Cardano – Cons

    • New crypto
    • Several competitors
    • Ambitious scope of work
    • Lack of engagement

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    Should you invest in Cardano?

    All cryptographic forms of money are profoundly unstable and speculative ventures.

    Cardano’s cost has been unstable, both this year and the prior years So potential financial investors ought to know about that and think about Cardano as a component of a more extensive broadened digital money portfolio.

    Cardano venture could bode well, as it has a genuine opportunity to remove a piece of business from Ethereum.

    Cardano may not be an overnight achievement, yet it has sufficient legitimacy to stay a top-level rival in crypto.

    Cardano has a solid group behind it and has effectively accomplished a great deal – the undertaking in Ethiopia is a noteworthy certifiable utilization of blockchain innovation.

    As we’ve seen, Cardano is more modest and more youthful than Bitcoin, which brings the two benefits and dangers.

    What’s significant is to comprehend what those are and gauge them against your requirements.

    Only put away cash you can stand to lose, and attempt to adjust the dangerous idea of the crypto venture by building a differentiated portfolio.

    Conclusion

    When it comes to cryptocurrency trading be it Cardano or any other cryptocurrency, it’s clear that it’s a speculative investment that has the potential for high returns. In its infancy, the market is still a young one. We must be prepared for ups and downs, including some dramatic swings, when investing in something new. In terms of market capitalization, Cardano is one of the top 10 most valuable cryptos, with a market capital of $84 billion today.

    FAQs

    What is Cardano?

    Cardano is a proof-of-stake blockchain platform that facilitates peer-to-peer transactions with its internal cryptocurrency.

    When was Cardano founded?

    Cardano was founded in 2015 by Charles Hoskinson.

    Is Cardano worth investing?

    Cardano being among the 10 most valuable cryptocurrencies with market value of about $84 billion is worth investing in.

  • The Story of El Salvador and Bitcoin – Why Bitcoin crashed?

    On the 7th of September, 2021 El Salvador became the first country to accept bitcoin as legal tender. The crypto could be used for all sorts of transactions in the country from buying some ice cream to paying your taxes. The brave adaptation idea was made clear by president Nayib Bukele, when he said he would be passing congress a bill that made bitcoin a legal tender in the country at the 2021 Bitcoin conference in Miami.

    El Salvador had bought 400 bitcoin worth about $20.9 million, a day before it formally adopted the currency legal tender. The government also released the Chivo digital wallet on Tuesday, which allows users to perform bitcoin transactions after signing up. The reasoning behind this move is still skeptical for world governments.

    According to president Bukele, the use of cryptocurrency is going to boost the country’s crippling economy. 70% of the population is unbanked and around 23% of the country’s GDP is from foreign remittances. Bitcoin was adapted to overcome this reducing the need for banks, improve accessibility and attract investments to the country. However, the country that abandoned its currency for the US dollar in 2001, was declined by the world bank.

    This was based on bitcoin lacking transaction transparency and concerns for its market value. The price of a commodity up for sale will remain the same regardless of the bitcoin value. This has led to a vast number of people going against the present implementation of the currency.

    History of Bitcoin in El Salvador
    The Government Implementation of Bitcoin
    The Bitcoin Crash and Why it Happened?
    FAQ

    History of Bitcoin in El Salvador

    Bitcoin isn’t something entirely new for the Latin American nation. Bukele had been tinkering with the cryptocurrency even before winning office in 2019. The lack of banking knowledge in the country means people had to rely mostly on cash. He’s also had plans for facilities and bitcoin mines that would add to such an economy in the country. The president himself has had experience with bitcoin and has assessed its potential benefits.

    Although a very small percentage of the population was aware of blockchain-based technology, El Zonte, a surfing village on the country’s pacific coast has been experimenting with it since 2019. Michael Peterson, an American who used to take family vacations to the coast from 2006, came to be the founder of the so-called Bitcoin Beach. Peterson was involved in the community’s activities and eventually started taking an interest in the economy by opening up guesthouses along the coast.

    The nation’s lack of banking capable citizens and bitcoins ‘store value’ was what prompted Peterson to start experimenting with bitcoin and the public’s reaction to it. A while after it had commenced, an anonymous American donor took interest in the project and started seeding the village.

    Although Peterson hadn’t talked to the donor in person, they’ve interacted with each other through a manager and shared similar interests to promote the growth of the village. This inspired Peterson to fully ‘Bitcoinzone’ the village and promote the various advantages of using cryptocurrencies for making purchases.

    The residents of Bitcoin Beach use the Strike app, the ATM, and peer-to-peer transactions to move money around and this seems to work fine for the most part.

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    The Government Implementation of Bitcoin

    The nation has partnered with Strike, a payments application developed by Zap Solutions, to develop the bitcoin infrastructure for the nation. The government has developed its own application Chivo, that allows users to send, receive and pay for transactions with bitcoin easily.

    El Salvador's President Nayib Bukele launching the Chivo App
    El Salvador’s President Nayib Bukele launching the Chivo App

    The application also promised users $30 worth of bitcoin in their wallet to promote its use. This was however suspended later on since the large number of transactions done by the users forced Chivo to go offline due to server overload. However, the president has promised that this issue will be resolved soon.

    Cities that previously had no banks have been provided with a Bitcoin ATM that can be used with their accounts to withdraw funds as cash. Payments have been simplified as most people have a smartphone and signing up just requires a government ID and does not require the user to have a bank account.

    The public opinion regarding the matter has been mixed. Some seem to embrace the technology and think that it’s the future of El Salvador while others resort to protests asking the government to withdraw their decision.

    “I prefer having my hard-earned money on me, it gives me a sense of satisfaction and assurance”, said one of the shopkeepers when asked about the change. Any change indeed requires some time to get used to or rather people need time to understand its benefits. The same goes for Bitcoin.

    For some poor Latin Americans, the change has been drastic and people have made small profits using the currency. Payments are easier and require much less effort compared to traditional means. This however does not patch up the volatile nature of bitcoin. It’s safe to say the value is unlikely to ever hit zero but the massive crash that occurred on Tuesday has spooked many citizens and left others concerned.

    The Bitcoin Crash and Why it Happened?

    As the nation was ready to move ahead with its adaptation of Bitcoin, on Tuesday morning the market had a massive crash, bringing the value down by 17%. Investors and market analysts may have predicted this drop well before it happened due to the president’s tweets, which expressed his idea for the legal tender.

    A large number of users performed transactions using Chivo, the government-made app on the day that bitcoin was implemented. Several users had converted almost all their money to Bitcoin in order to carry out payments and try out the new system.

    The wallet temporarily crashed due to server overload and this has been the reason for the drop in bitcoin value. The citizens were provided with multiple ways to transact but the masses had relied on Chivo. The price had dropped to around $43,100 from $52,457 earlier that day. The market is now stabilizing at $45,935.

    Bitcoin Crash
    Bitcoin Crash

    Experts say that this could possibly happen again as more users are starting to adopt bitcoin as their daily money. The use of any cryptocurrency as the general means of spending money can lead to the downfall of a nation’s economy.

    The protests continue in El Salvador while people who like the idea of a change have decided to learn more about it. Some have even become self-learned brokers using the volatile nature of Bitcoin to their advantage. The current state of things can only be looked at from an experimental perspective as of now.

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    Conclusion

    Is the implementation of Bitcoin going to be the downfall of an already economically struggling nation? It’s something we’ll have to wait and observe. The democracy has chosen this on their own and it’s safe to say they’ve done their research before doing so. The risks of such an economy are very real but as its citizens have commented so are the benefits.

    Bitcoin could be what empowers a nation that largely relies on remittances. The citizens are becoming more aware of the change and this could bring new opportunities to them, leading to a more developed and stable economy for the future El Salvadorians.

    FAQ

    When did El Salvador adopt bitcoin?

    The people in El Zonte, El Salvador started adopting Bitcoin in 2018 through the development of Bitcoin Beach.

    How much bitcoin did El Salvador buy?

    El Salvador acquired roughly $21 million worth of bitcoin, President Nayib Bukele announced.

    Yes, Bitcoin became legal tender in El Salvador on 7 September 2021, and El Salvador is the first country to have bitcoin as legal tender.

  • Bitcoin Mining: All You Need To Know About How Does Bitcoin Mining Work

    Bitcoin mining means gaining bitcoins by solving cryptographic equations and puzzles through the use of computers. Cryptocurrencies transactions are recorded in blockchains. Bitcoin mining is the key to maintain blockchains. It helps in recording transactions and keeping the bitcoin decentralised. Bitcoin mining is the process to verify transactions and add it to the digital ledger.

    What is Bitcoin Mining?
    About Bitcoin Miners
    How does Bitcoin Mining work?
    What do you need to mine Bitcoin?
    Why become a Bitcoin Miner?
    Is Bitcoin Mining Legal?
    Are there risks in Bitcoin Mining?
    FAQs

    Bitcoin Mining

    What is Bitcoin Mining?

    About Bitcoin Mining
    About Bitcoin Mining

    Bitcoin mining is the cycle by which new bitcoins are created, yet it is significant for the upkeep and improvement of the blockchain record. It is performed utilizing exceptionally modern PCs that take care of amazingly complex computational numerical questions. Bitcoin mining is an interaction of making another coin that uses algorithms to solves complex numerical calculations or problems.

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    About Bitcoin Miners

    Bitcoin is a decentralized cryptocurrency that doesn’t have a global server or a head bank or the government to supervise its management. The process of mining is solely handled by bitcoin miners.

    Miners keep the blockchain reliable, complete, and firm by over and again gathering recent exchanges into a block, which is then transmitted to the organization and checked by beneficiary nodes.

    Each block contains an SHA-256 cryptographic hash of the past block, hence connecting it to the prior block and giving the blockchain its name. However, in the case of Cryptocurrency exchange, there is always the danger that a holder could make a duplicate of the advanced token and send it to a shipper or another merchant while retaining the initial.

    The job of the miner is to check transactions to ensure that clients have not misguidedly attempted to spend the equivalent bitcoin twice. Verifying each 1MB worth of transactions makes a miner qualified to earn bitcoin. The first miner to solve the complex puzzle earns bitcoin. This is also known as “proof of work”.

    How does Bitcoin Mining work?

    Bitcoin- hexadecimal hash
    Bitcoin- hexadecimal hash

    The number above is called a hexadecimal hash. Millions of miners work on guessing a target hash. Although when you are mining bitcoin, you don’t have to ascertain the complete and exact worth of a hash. A nonce is an arbitrary number that can be used just once in cryptocurrency. The nonce is the way to creating these 64-digit hexadecimal numbers.

    Miners make speculations by arbitrarily producing as many “nonces” as could be expected, as quickly as possible. In Bitcoin mining, a nonce is 32 pieces in size—a lot more modest than the hash, which is 256 pieces. The primary miner whose nonce produces a hash that is not exactly or equivalent to the objective hash is granted credit for finishing that block and is granted the crown jewels of 6.25 BTC.

    So then how to guess the exact target hash?

    All targets start with 0s and can have any number of 0s between 8 and 63.
    Your best shot at correctly guessing the target hash is by joining a mining pool.
    This gathering of coin diggers solidifies their figuring force and split the mined bitcoin.

    The complex level of the latest block is about 17.59 trillion, implying that the possibility of some random nonce creating a hash underneath the objective is 1/17.95 million. Not incredible chances in case you’re chipping away at your own, even with an enormously amazing mining rig.

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    What do you need to mine Bitcoin?

    Consequently, Bitcoin is intended to assess and change the trouble of mining every 2,016 blocks, or generally at regular intervals. When there is registering power all in all attempting to dig for Bitcoin, the trouble level of mining expansions to keep block creation at a steady rate.

    Less processing power implies trouble level reductions. To get a feeling of exactly how much figuring power is included, when Bitcoin dispatched in 2009 the underlying trouble level was one. As of Nov. 2019, it is over 13 trillion.

    The entirety of this is to say that, to mine seriously, diggers should now put resources into incredible PC hardware like a GPU (designs handling unit).
    These can run from $500 to the many thousands. A few miners—especially Ethereum diggers—purchase singular illustration cards (GPUs) as a minimal expense approach to cobble together mining tasks.

    Why become a Bitcoin Miner?

    is Bitcoin mining profitable?
    is Bitcoin mining profitable

    A bitcoin miner earns cryptocurrency without spending any money!
    Bitcoin miners receive Bitcoin as an award every time a transaction is verified.
    In fact, as of 2021, Bitcoin mining is very profitable for people who have a knack for cryptocurrency.

    Miners receive around 6.25 bitcoins per transaction although this number may be halved in 2024 to 3.125 bitcoins since the awards for bitcoin mining are decreased considerably after 4 years. In 2020,  the cost of Bitcoin was about $17,900 per Bitcoin, which means you’d procure $111,875 (6.25 x 17,900) for finishing a block.

    Is Bitcoin Mining Legal?

    Bitcoin is fairly legal in most places across the globe although it does have its share of countries where it is illegal. The idea of Bitcoin can undermine the predominance of fiat financial standards and government command over the economic business sectors hence it is illegal in some places. Some countries like Egypt, Morocco, Nepal, Algeria, Bolivia are some places where Bitcoin is illegal.

    Risks in Bitcoin Mining

    Bitcoin mining is general is a financial risk. One could go through all the hard work of buying hundreds or thousands of dollars worth of mining gear just to have no profit from their investment. All things considered, this danger can be relieved by joining mining pools.

    If you are thinking about mining and live in a space that is banned from it you ought to rethink. It might likewise be a smart thought to explore your nation’s guidelines and generally speaking conclusion towards cryptographic money before putting resources into mining gear.

    One extra possible danger from the development of bitcoin mining (and other verification of-work frameworks also) is the expanding energy use needed by the PC frameworks running the mining calculations. While CPU proficiency has expanded drastically for ASIC chips, the development of the actual organization is dominating mechanical advancement.

    Thus, there are worries about the natural effect and carbon impression of Bitcoin mining. There are, nonetheless, endeavors to alleviate this negative externality by looking for cleaner and efficient power fuel hotspots for mining tasks, (for example, geo-warm or sunlight-based), just as using carbon counterbalance credits.
    Changing to less energy-escalated agreement systems like confirmation of-stake (PoS), which Ethereum is intending to do, is another methodology; in any case, PoS accompanies its arrangement of disadvantages and failures.

    FAQs

    Bitcoin mining is legal in many countries but illegal in some countries.

    Which are the countries where Bitcoin mining is illegal?

    Countries where Bitcoin mining is illegal are:

    • Algeria
    • Egypt
    • Morocco
    • Bolivia
    • Ecuador
    • Nepal
    • Pakistan

    Is Bitcoin mining profitable 2021?

    Bitcoin miners can expect to generate around 226% profit in a day. So, It seems to be quite profitable.

    How long does it take to mine 1 Bitcoin?

    There is currently no way to mine just one bitcoin. Instead, crypto miners will mine one block. It takes 10 minutes to mine one block.