Evolution of Cryptocurrency

Abstract

The avatar of currency has evolved over time, and 'cryptocurrency' is its latest incarnation. Cryptocurrency is a type of digital currency that allows peer-to-peer online payments without interference of financial institutions. Though experts are impressed with its growth trajectory, its decentralized and unregulated structure has stirred insecurity amongst governments across jurisdictions that has translated into bans and indecisiveness related to its status. While the concerns are not baseless and it is susceptible to cybercrimes, the focus must be to mitigate the issues rather than imposing a blanket prohibition that would be antithetical to the fundamental spirit and purpose of financial digitization, which is to promote the free flow of funds. In this chapter, the authors, firstly, analyze the practicality of cryptocurrency in light of the legal barriers and, secondly, assess the viability of a regulatory framework that ensures minimal control from the authorities but also checks concerns including cybercrime, illegal transactions, tax evasion, and lack of accountability.