Explained: What Is Bitcoin? Cryptocurrency That Tesla Has Invested In
Tesla Inc has invested $1.5 billion in Bitcoin.
New Delhi:
Bitcoin was once again in the news after Tesla invested $1.5 billion in it and signaled its intent to begin accepting the cryptocurrency as a form of payment, sending prices to a new record after the vote of confidence. The leading electric-car maker’s embrace of Bitcoin lends increased legitimacy to electronic currencies, which have become more of a mainstream asset in recent years.
What is Bitcoin and how does it work:
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First launched in 2009, Bitcoin is a kind of cryptocurrency or digital currency that exists completely online.
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By its very nature, the currency is decentralized without a single central bank to administer it and the currency is stored in digital wallets.
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These wallets are backed by private and public keys for security, and the public key is what lets users transact with each other.
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All transactions are verified and recorded in a public ledger called the blockchain with complete transparency ensuring that the system cannot be cheated.
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Because of its decentralized nature and the anonymity associated with it, the currency can be easily traded across users and countries without identifying the person who holds the bitcoin.
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The popularity of bitcoin has spurred a range of alternate crypto currency including Etherium, Dogecoin and Binance.
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In India, Bitcoin stands in a grey area of legality. As of now, it is not illegal to trade bitcoin, however, the Cryptocurrency and regulation of Official Digital Currency Bill aims to ban bitcoin.
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Instead, the Indian government seeks to create its own national cryptocurrency.
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India temporarily banned crypto transactions in 2018, however, the bill was overturned by the Supreme Court after cryptocurrency exchanges filed a lawsuit.
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With the growing global acceptance of the digital fiat as legal tender, it remains to be seen exactly how the Indian government will proceed with its draft regulation.
