Initially, on raising a family, a father and a mother grew up in a different environment. So with the mindset of raising a family, they got involved in daily affairs of bringing up their child. During their time it’s cash everywhere, so they bought a physical asset like land by converting the currency at hand. Digital currency tends to change these phenomena.
The head of the family works hard to earn every penny. Eventually, they raised their kids and got old fashioned to attach with their physical assets of properties like land. These were referred to as mortgages. Most securing their earning by investment on mortgages. Some also obtained loan from banks to have a home on their own. Later which paid with the additional interest on the amount.
But for banks to lend money what is their source of income?
Central banks like RBI carry out activities of printing currency. It is supplied to end-user by intermediaries like banks. The entire logistics of handling cash becomes a long driven process. Any interventions minimizing this task considered to be established as an innovation in the financial industry.
Managing fiat currency:
As the kid grows up, there were inventions of plastic money in the form of electronic numbers. It makes a smooth transition of allaying initial fears of a new kind of currency. It enables individuals to switch between hard cash in hand to plastic cards in their wallets. Moreover, the invention of ATM reduces piling up of cash under the roof of banks. Then it is put to use for daily transactions.
Later, the digital revolution enables financial transactions to happen through the internet. Many private enterprises started exploring these changes in the currency market to offer payment services. It offers multiple choices to the users by providing various payment platforms like
Such changes in the money market clearly showed that the essential nature of money is to be a liquid asset. Thus cash or money can be converted into any form in this physical world. It enables people to use the money for buying and selling activities of goods as well as services.
- Debit or credit card
- Netbanking
- Mobile wallets.
- Cash on delivery
As soon as crypto becomes a worldwide phenomenon, the fatherly attitude caught up in every government. A father being head of the family got more attached to his earned assets rather knowing changes in the market. He hardly got adapted to various modern payment platforms.
Every father is the head of the family and owns the responsibility of protecting one’s family. Similarly, the government in the name of protecting its own people did not want to lose control of their hard-earned assets.
So the government could not able to find essential attributes in the normal fiat currency to cryptocurrency. It is none other than a mindset issue for those holding the big fat chair of authority.
Virtual currency and cryptocurrency:
Moreover, the ban in India has also been accrued to reasons for rising trade across borders using cryptocurrency. While every government grapples with their protective mindset, as they tend to lose their share of the pie in such a growing market. Many developed countries like the U.S and Europe started claiming tax on the wealth earned out of virtual currency.
It is marked by the social media giants entry into the cryptocurrency market. Facebook unveils its new digital currency named libra. It is a realized fact that going after the digital economy eventually paves the way for virtual currency.
This next-gen platform tends to be highly liquid and easily convertible. As we all know Rome is not built in a day, the statistics align in favor of this modern mode of transactions.
The digital currency tends to solve the mystery of why a central authority cannot decide on putting money in one’s own pocket.
Digital Currency:
The inter-ministerial panel although proposes a ban of cryptocurrency, it also recommends keeping an open mind about digital currency. It recommends RBI to examine the utility of Distributed Ledger Technology (DLT). This clearly shows the potential of virtual currency over fiat currency.
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