Success and failure of digital money and virtual money: Case of cryptocurrency-bitcoin

Abstract

Digital currency is a type of currency available in digital form. Though it exhibits similar properties and value as physical currency but it can allow instant transfer of ownership and thus makes transactions smooth. It is used as a blanket term for all electronic money including both virtual currency and cryptocurrency. It can be regulated or unregulated. However virtual currency is a complicated term to understand. Though it comes under digital currency but its functions are totally different and have some issues in its regulation. It only works through designated softwares, mobiles or computer application through digital wallets. We can say that it is a subset of digital currency group. Due to lack of a centralised regulatory authority, such virtual currencies are prone to wide swings in their valuations. Despite around 77% of Indians being familiar with such currencies, the awareness about it is very low. Around 23% of consumers are unconcerned about security related issues while dealing with cryptocurrency. India has a very complicated relationship with cryptocurrency. In this paper we will discuss the success and failure levels of various forms of virtual currency, issues related to its ban in India.