What Is Private Cryptocurrency In India?
From what we have all heard, the Indian government is working on the Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, which is to be presented in the upcoming Winter session of Parliament. It aims to ban all private cryptocurrencies in India. So, let us take a look at what these private cryptocurrencies are.
Private Cryptocurrency — In Terms of the Bill
The government hasn’t yet defined what it means when they say private cryptocurrency. We know that Bitcoin, Ethereum, and the like are built on public blockchain networks, which means that anyone can view the transactions on them while still giving the users the benefit of being anonymous.
The central bank has stated that private cryptocurrencies are a matter of serious concern and they are planning to launch their own digital currency soon. There has been a mention that the government will allow for exceptions to the private crypto ban, but we can only confirm things once the bill gets passed. All news until then remains tentative.
Public and private cryptocurrencies now have more technical definitions in the world of crypto. It is unlikely that the government meant private cryptocurrency pertaining to those definitions, but we’ll nevertheless take a look at them. What seems likely is that by private cryptocurrency, the government meant any privately held cryptocurrency and so public cryptocurrencies might mean the ones owned by the state.
Public Cryptocurrency vs. Private Cryptocurrency
With public cryptocurrencies, users can use pseudonyms to hide their actual identity, but the transaction data is openly available for anyone to view. Examples of these are Bitcoin and Ethereum.
In the case of private cryptocurrency, the wallet addresses and transaction data are hidden. The users here have a sense of privacy compared to public cryptos. Some examples of private cryptocurrencies are Zcash, Monero, and DASH.
Final Thoughts
There is speculation about what actually defines the term private cryptocurrency in the bill, but things will get cleared up only after the bill gets passed. Until then, the doors are open for the assumption.
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