Indian banks have relaxed the rules on acquiring Bitcoin and other cryptocurrencies through their channels. The action came after the Reserve Bank of India stated banks could no longer use its April 2018 circular. To advise against cryptocurrency investments after invalidated by the Supreme Court. The recent decision will aid in the growth of cryptocurrency usage in the country, which is already gaining traction.
What is Cryptocurrency?
Cryptocurrencies are binary data formatted for use as a medium of exchange. They maintain individual coin ownership records in a database as a form of a computerized ledger, encrypting their transactions. Further controlling the creation of new coins, and verifying the transfer of ownership. Cryptocurrency not issued by a central authority and does not exist in physical form (like paper money).
Indian banks have removed restrictions on the purchase of Bitcoin and other cryptocurrencies through their channels in accordance with government laws. This is a huge relief for cryptocurrency investors in the nation. The move in, Indian banks came as a result of the Reserve Bank of India’s (RBI) earlier ruling. Stating that banks may not use its April 2018 circular to advise against cryptocurrency investments and reject cryptocurrency services. The RBI issued a circular in 2018 stating that due to the dangers involved, organisations regulated by the RBI shall not deal in virtual currencies. Also, nor shall they provide services to assist anyone in dealing with or settling virtual currencies (VCs).
Above all, cryptocurrencies have the potential to make it easier to move funds between two parties. This done without the use of a trusted third party such as a bank or credit card provider. Instead, these transfers protected by the use of public and private keys. As well as other incentive systems like Proof of Work and Proof of Stake. A user’s “wallet,” or account address, in modern cryptocurrency systems, has a public key. While the private key only known to the owner and is used to sign transactions. Users can avoid the high fees charged by banks and financial institutions for wire transfers by completing fund transactions with minimal processing expenses.