Subhash Chandra Garg, the Indian official who resigned the interministerial committee after releasing the report on crypto to which the Indian crypto community calls “flawed” published another statement regarding virtual currencies.
Mr.Garg on Cryptocurrency
Mr.Garg published a new blog post, entitling “Currencies will be digital; crypto-currencies will not survive”. He details volatility of Bitcoin as the major blotch of digital currencies and elaborated that the Indian government hasn’t officially permitted the Indian payment system to allow trading and dealing in cryptocurrencies. He mentioned that the supply of Bitcoin is limited henceforth demand for Bitcoin is more “born out of expectations of speculative gains”. Concerning about the volatility, Garg wrote;
There has been some use of crypto-currencies in payments, including international transfers, but it is not gaining any traction as there is no fixed/stable value, which is the most essential condition for any currency to be a currency.
However, he also stressed that “all operating cryptocurrencies in the world are created by private entrepreneurs/speculators using blockchain technology is decentralized, non-permissioned mode”.
Besides, Mr.Garg emphasized that few countries have initiated their plans to launch digital currency which might be using permissioned blockchain technology. More so, without naming the particular company and cryptocurrency, Mr.Garg concurred that “few private crypto-entrepreneurs are looking forward to reducing the cost of international cross-border payment transfers and remittances. He went on to say;
Presently existing modes of international payments, transfers, and remittances involving conversion in different sovereign currencies and the use of international banking and non-banking channels are indeed quite costly.
2020 Might See the End of Paper Currency and Bank Notes
He further argued that the “paper currency or bank notes” are the most prevalent form of currency today in the world. These notes or paper currencies are issued as well as allowed by the central banks of the countries which undertake the task to maintain the value of the currency in order to discard inflation.
Mr Garg explains that the cryptocurrencies built on top of Blockchain technology allow every individual and holder of a piece of crypto-currency to be part of a decentralized ledger. He further asserted that the miners or computer programmers are getting paid in cryptocurrency to perform mining operation. In his long blog post, he quietly embraced the inherent technology and said the deficiencies lie in this technology can possibly improve in the future. He went on to add;
What, however, has gone crazy is that the currency issuance function has been taken over by the private entrepreneurs and that too mostly in secretive, manipulative and cryptic manner….The crypto-currency private entrepreneurs do not have any ability to maintain the value of the currency. In fact, they mostly destroy the value by expanding supply, which can be limitless
This being said, many cryptocurrencies, barring a few, have failed to exist as payment method. “This is what is reflected in the demise of many crypto-currencies or almost total loss thereof.”said Mr.Garg. Conclusively he believes that 2020 might witness the decline of paper currencies all over the world and in many countries.
Finally, it is possible to conceptualize the dematerialization of currency and money and make the final move to say good-bye to paper money and move over to digital money, concluded Mr.Garg.