WHAT IS BIT COIN?

 

BIT COIN

Bitcoin is a digital currency which operates free of any central control or the oversight of banks or governments . Instead it relies on peer-to-peer software and cryptography. A public ledger records all bitcoin transactions and copies are held on servers around the world.

PUBLIC LEDGER

The public ledger is used as a record keeping system that maintains participant's identities in secure and (pseudo) anonymous form, their respective cryptocurrency balances , and a record book of all the genuine transactions executed between network participants.

MINING 

Bit coin runs on a decentralized computer network or distributed ledger that tracks transactions in the cryptocurrency. When computers on the network verify and process transactions new bitcoins are created or mined. These networked computers , or mines , process the transaction in exchange for a payment in Bitcoin.

According to a recent research , Bitcoin mining is a highly concentrated business , with 10% of bitcoin miners controlling 90% of mining capacity on Bitcoin's network.

WORKING

Bitcoin uses the SHA-256 hashing algorithm to encrypt the data stored in the blocks of blockchain. Simply put, transaction data stored in a block is encrypted into a 256 bit hexadecimal number. That number contains all of the transaction data and information linked to the blocks before that block.

INDIA AND CRYPTOCURRENCY

The Union Budget 2022-2023 of India has also proposed to introduce a digital currency in the coming financial year. It was also announced that " any income from transfer of any virtual digital asset shall be taxed at the rate of 30%.

OTHER CRTPTOCURRENCYS

• Litecoin
• Peercoin
• Namecoin
• Cardana
• Ethereum
• Tether
• Binance

APPLICATIONS OF BLOCKCHAIN TECHNOLOGY

• Healthcare, banking , education, agriculture electricity distribution and land records are sectors that could benefit.
• Block chain powered smart contracts, where every piece of information is recorded can enhance ease of doing business.
• It will augment the credibility, accuracy and efficiency of a contract while reducing the risk of frauds, substantially.
• It could play a crucial part in health insurance claims managements by reducing the risk of insurance claim frauds.
• It can be used to prevent the sale of spurious drugs in the country by tracking every step of the supply chain network.
• Artificial intelligence and internet of things can gain immensely from blockchain applications.
• It could be used to further strengthen our national institutions, including the judiciary and the election commission.

WAYFORWARD

• Blockchain , with all its possibilities needs a serious look at its vulnerabilities and commerciality.
• Before introducing blockchain into the public sector data handling system , we need a robust and informative data repository.
• Linking India Chain with Aadhar creating a secure personal identity for all Indians.
• Proper regulations for the use of bock chain technology in the country.
• Identifying and resolving key issues and challenges in implementing this technology, the prime amongst those being data privacy.
• India should effectively channel its technical human capital surplus to position itself as one of the pioneers during this upcoming wave of innovation.