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A cryptocurrency or crypto, is a virtual currency secured by cryptography. It is designed to work as a medium of exchange, where individual ownership records are stored in a computerised database.

The defining trait of a cryptocurrency is that they are not issued by the government agency of any country making them immune against any interference and manipulation from them.

Latest Developments regarding Cryptocurrency in India The Cryptocurrency and Regulation of Official Digital Currency Bill 2021 is likely to be introduced in the winter session of the Parliament. It is a bill that would regulate Cryptocurrency in India. On December 7 2021, Finance minister Nirmala Sitharaman asserted that the the proposed Central Bank Digital Currency will not boost cryptocurrency in India.

This article will further discuss the details of cryptocurrency within the context of the Civil Services Examination.

In simplistic terms, Cryptocurrency is a digitised asset spread through multiple computers in a shared network. The decentralised nature of this network shields them from any control from government regulatory bodies.

The term cryptocurrency in itself is derived from the encryption techniques used to secure the network.

As per computer experts, any system that falls under the category of cryptocurrency must meet the following requirements.:

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The first type of crypto currency was Bitcoin, which to this day remains the most-used, valuable and popular. Along with Bitcoin, other alternative cryptocurrencies with varying degrees of functions and specifications have been created. Some are iterations of bitcoin while others have been created from the ground up

Bitcoin was launched in 2009 by an individual or group known by the pseudonym Satoshi Nakamoto. As of March 2021, there were over 18.6 million bitcoins in circulation with a total market cap of around $927 billion.

The competing cryptocurrencies that were created as a result of Bitcoins success are known as altcoins. Some of the well known altcoins are as follows:

Today, the aggregate value of all the cryptocurrencies in existence is around $1.5 trillionBitcoin currently represents more than 60% of the total value.3.

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Cryptocurrency has the following advantages

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Cryptocurrencies have the following disadvantages.

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For more information about the UPSC Syllabus, visit the linked article. More exam-related preparation materials will be found through the links given below

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Cryptocurrency: Definition, Advantages & Disadvantages