Crypto : Corruption : Corona : China

At one time, I was opposed to Crypto-Currencies ( eg : BitCoin ) because of its potential for money laundering / corruption etc . 

That made me write following blogs / emails to our Cabinet Ministers :

 In the Eyes of the Beholder ? ………………………………………[ 06 Aug 2017 ]

Virtual Currency ? Time to get Real  …………………………….[ 17 Aug 2017 ]

One  More  Reason ………………………………………………………..[ 22 Nov 2017 ]

What is holding back ?  ………………………………………………….[ 06 Dec 2017 ]

Bursting Bitcoin Bubble ? ……………………………………………….[ 10 Dec 2017 ]

Bitcoin : Illegal in India  …………………………………………………[ 02 Jan 2018 ]

 

Then by early 2019, I learned about Facebook’s plan to dominate the e-Commerce of entire world through launch of its own / proprietary ( non- Sovereign ) Crypto Currency called LIBRA

 

That made me write / send following e-mails :

LIBRA : The coming battle of Currencies ?  …………………[ 29 June 2019 ]

LIBRA : Am I the only one worried ?  …………………………..[ 05 July 2019 ]

Who is afraid of the Big Bad Wolf ( aka LIBRA ) ?........ [ 07 July 2019 ]

Latest word on LIBRA : though not the last word………….[ 10 July 2019]

 

Then came the following news that made me re-think and consider, the POSITIVE aspects of a Crypto-Currency , if it were to be :

 

Ø  Backed and regulated by Government of India / RBI

Ø  The ONLY crypto-currency of India ( no other  “ private minting “ by anyone )

Ø  Totally replaces CASH [ paper currency notes ] from our economy ( full digitization ),

 

Will China Reign Supreme ?   …………………………………………..[ 15 Oct 2019 ]

Elephant Bonds vs Dragon Bonds …………………………………….[ 04 Nov 2019 ]

 

Then, when I read the following news, I felt elated :

India’s Draft National Strategy On Blockchain Calls For Official Cryptocurrency[28/01/2020 ]

 

And sent following email to Cabinet Ministers :

Time to Un-Block the Blockchain Technology  …………………..[ 30 Jan 2020 ]

 

Then came following depressing news :

With a law, India plans lasting ban on cryptos  ………………….[ 12 June 2020 ]

Extract :

Ø  The panel, headed by former finance secretary Subhash Garg, had, in its report, advocated a ban on all forms of private virtual currencies, though it asked the RBI and the government to look at introduction of an official virtual currency

What will convince RBI / Government to issue OFFICIAL VIRTUAL CURRENCY ?

Here is a brief ( non-comprehensive ) suggestion for proposed Law :

Ø  While banning Private Crypto, introduce IndiaBit ( Govt Virtual Currency )

Ø  With some effective date , withdraw all Paper Currency ( forget coins )

Ø  Minimum denomination will still be called a RUPEE ( easy to convert from paper to digital )

Ø  As of a date , bank balances in everyone’s bank account gets converted to IndiaBits

Ø  Set time limit within which people can deposit their paper currency into banks for instant conversion into IndiaBits

Ø  After set date, paper currencies held by anyone ( individual or any legal entity such as a Company ), loses all value and become illegal for any sell / purchase transaction

Ø  All future financial transactions ( sell / buy of any goods or services ) can only be through mobile-app based DIGITAL transactions

Ø  Since all transactions will become DIGITAL , Govt would have full / life-time LOG of each citizen’s “ Sale or Purchase “ [ Who bought What , When , from Whom , at What price , Where etc ] .

Ø  Here is why automatic compilation of such CONSUMPTION DATA for the entire economy, will be a GAME CHANGER :

          Economic data will help policy  ……………………………… 16 June 2020

Extract :

Ø  What were household incomes before the coronavirus pandemic? Were they enough to meet consumption needs? Were rich households more debt-ridden than their poor counterparts? Which parts of the country are likely to suffer from interruption of remittances due to reverse migration?

Ø  The latest available consumption expenditure survey dates back to 2011-12.

Ø  With no credible official data about the economy, policymakers will be groping in the dark. This will also prevent an informed public debate.

Ø  For example, the Reserve Bank of India could work with banks and payment companies to provide a geographical map of remittance flows before the pandemic. Phone companies should be asked to share information on SIM card movement patterns to give an estimate of reverse migration.

    Making Goods and Services Tax input credit chains public could give an insight into

   value chain linkages and potential interruptions due to the lockdown. But, to begin

   with, the government should release the National Sample Survey Office’s 2017-

   18 Consumption Expenditure Survey, which it had hastily scrapped last year. This is

   literally a click away.

Dear Smt Nirmala Sitharamanji / Shri RaviShankar Prasadji / Shri Piyush Goyalji,

I have no clue as to what mechanism could be used ( Inter-Currency Exchange Rate ) for payment for Imports and remittances for Exports , if – and when – we introduce IndiaBit

But if IndiaBit can ,

#  To begin with bring out all BLACK MONEY ( stashed away as paper currency notes )

     and deploy the same into mainstream economy for productive purposes , and

#  Put a Full Stop to any future generation of Black Money ,

-      then my proposal deserves a debate

With regards,

Hemen Parekh

hcp@RecruitGuru.com  /  June 18, 2020