The Concept of Cryptocurrencies

History is debatable but it is believed that more than 2500 years ago, the first coins were introduced and about 1400 years back, the Chinese were the first to use paper bills (mostly in the form of privately issued bills of credit or exchange notes). Some of the early forms of ancient coins were minted by merchants as tokens for use in trade transactions. Although it may have taken centuries for coins and paper notes to establish its roots across the world its commercial utility was so impactful that even today our interpretation of money heavily relies on it.

Fast-forward to the 21st century and what we are staring at is cryptocurrencies and with much enthusiasm, at the technology behind it — the blockchain technology. This article is only an attempt to understand some of the probable reasons behind the growing popularity of cryptocurrencies in India and to highlight the emerging recognition of blockchain technology.

In the last few years, the concept of cryptocurrencies has garnered significant global attention something that India has been closely watching. It may not be very hard to believe that such a period of observation might have served as a head start for many fintech enthusiasts in India. The novelty factor further sustained the interest and curiosity in cryptocurrencies.

Anticipating profitable returns from an investment is the natural tendency of an investor. The mind-boggling surges in the prices of some of the most popular cryptocurrencies over a very short period of time may have appeared to be very luring from a returns perspective but the high prices of these popular cryptocurrencies also make them unaffordable to the small investors and one of the probable outcome of which is that it could drive these small investors to explore other cryptocurrencies with the anticipation of similar levels of returns as with the popular cryptocurrencies.

However, return on investment is only one of the many factors for evaluating and examining an investment option. Other factors like exercising prudence and assessing the prospects of a project for which investment is sought are also very important.

Another factor for the buoyancy in cryptocurrency trading in India could be the profile of the small trader — young, tech-savvy and compliant — a phenomenon emanating from favourable demographics.

According to a media report, Reliance Jio Infocomm Ltd is mulling to create its own cryptocurrency, JioCoin and is also planning to build a team of young professionals to work on blockchain technology.

Kodak is also planning to come up with its own cryptocurrency called the KodakCoin — meant to work as token inside its new blockchain-powered KodakOne platform — a rights management platform for photographers.

Another company — Obizcoin is planning to deliver its proven solutions through BOT. OBIZCOIN is developing a Smart Business Process Automation BOT based on Artificial Intelligence and Blockchain Technology.