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Bitcoin traders boom in India as bitcoin economy surges up

The bitcoin economy has recovered from the recent Tether hack. Bitcoin traders and investors are happy.

by Kaustav Roy

Bitcoin prices are highly volatile. In the  last month prices fluctuated below $5,000 as the open-source community behind it was divided behind the usage of various forks or modification branches like Bitcoin Cash which provided investors opportunities to invest outside Bitcoin Core.

There were a host of other factors like the recent hack of Bitcoin’s rival cryptocurrency, Tether, which brought down Bitcoin’s valuation by almost 6 percent.

Yadunandan Batchu, a Blockchain developer with the Bangalore-based bitcoin trader, Unocoin saidthe bitcoin prices are supposed to be volatile at its early stages of development.

He also added that the bitcoin investment is not like normal investment but requires technical understanding of how the bitcoin economy works.

Bitcoin is a cryptocurrency  based on a peer-to-peer based blockchain technologywhich every connected computer acts a part of a large distributed system.

IA set of people called miners in the community blockchain all transactions in the system by investing their computing powers,keeping the system free from fraud or double transactions. They also receive remuneration in bitcoins for their contribution in validating every transaction.

Somrik Banerjee,a machine learning researcher said that Bitcoin is mainly popularly in the DarkNet, the non-indexed part of the World Wide Web where most users  participate  for the sake of privacy and security.

Subhash Prajati, a Global Expansion Leader with  USI-Tech said that the company gets around 200 Indian customers on a monthly basis and the individual investments are on a rise ever since the market price of the cryptocurrency skyrocketed earlier this year.

Gawrav Mehta, Director of Blockright said that the RBI has clarified that cryptocurrencies like bitcoin can not be used as  a legal tender or mode of payment in India. However, the country has more than threemillion crypto enthusiasts holding more than two million wallets and are witnessing a growth of around 200 percent per month.”

Muhammad Danish, a Bangalore-based stock exchange trader said investment in bitcoin is a growing trend in India and in the city. However, traditional traders and investors still prefer to invest in hard markets like BSE, NYSE as they know the technical know-how of the markets.

Bitcoins maybe have been on the rise for the past few years but cryptocurrencies are not fool-proof security and can be hacked. Cryptocurrencies like Bitcoin and Thether have been hacked in the past which then negatively affected the market prices of the overall cryptocurrency ecosystem.

The bitcoin economy is based on pure speculation and the recent crash was a result of it. There are too many factors which can happen internationally that can affect the prices, said Yadunandan.

However, some believe the investment can be made in the Bitcoin market based on traditional stock market technical know-how. Danish added that old school technical analysis still works as a handy tool when it comes to studying and investing in the Bitcoin economy.

Yadunandan said the problem with this system in India is that it can possibly encourage anonymous transactions and off-shore tax evasions. Therefore, traders must have a Know Your Customer (KYC) system which registers the details of the customer. However, he said that there is a lack of regulation regarding the outflow and inflow of Bitcoin in India.

This month, the Supreme Court responding to a PIL filed by Delhi-based lawyer Dwaipayan Bhowmick asking for the regulation of Bitcoin, notified the central government and other government agencies to come up with a framework to regulate the flow of Bitcoin in the country.

But, the government has been already concerned about money laundering and illicit activities with cryptocurrencies like bitcoin in the aftermath of the Wannacry attacks in the country and the Securities and Exchange Board of India (SEBI) is working on a regulatory framework for businesses engaged in bitcoin trading, said Gawrav.

He added that there are firms in India which are working on blockchain forensics  which can help the government or other regulatory agencies to track the movement in public ledger of Bitcoin.

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