Bengalureans know little about cryptocurrencies, are wary of them

Bengaluru City cryptocurrency

Say there is no clear information on the subject

There is a lack of knowledge among people in Bengaluru around the subject of cryptocurrencies and blockchain.

Tanya Sharma, a student from Bengaluru, informed The Observer: “I don’t know much about crypto currencies. I cannot comprehend the concept of virtual money. I have tried watching various YouTube videos to understand the math behind cryptocurrencies such as Bitcoin but it all went above my head. I am not confident about it and fear losing money due to its financial volatility. I would rather save my money in a bank account.”

The Observer noted most people are afraid to invest in cryptocurrencies.

Presha Malhotra, another student, said: “I don’t know much about blockchain technology, on which cryptocurrencies are based. I am scared of investing in them because they are not regulated by any government body. Most cryptocurrencies are controlled by private companies that I know nothing about. What if the system fails and I lose everything? There is no clear information.”

 “The government has brought a new rule banning all private crypto companies in the country which will, in turn, give rise to an official, RBI authenticated cryptocurrency. Maybe then I will invest in it,” she added.

Some attribute the novelty of cryptocurrencies as reason behind this lack of understanding.

Vansh Sinha, 46, said: “We all fear things that are alien to us. I guess the apprehension will go with time.”

The older generation suffers the most owing to the digital divide.

Sita Ram, 76, shared: “I don’t have much technological knowledge. Cryptocurrencies seem technical to me. What if I invest and end up losing all my money due to one click?”

Anand Kumar Aggarwal, who regularly invests in cryptocurrencies, said: “People lack knowledge about the subject. There are a range of different coins. One cannot comprehend how one Bitcoin can fetch you Rs 50 lakh. It has become something like betting. A luck factor is involved.”

The Economist Intelligence Unit,  research and analysis division of the Economist Group, released a new report called “Digimentality 2021”. The study, commissioned by the cryptocurrency platform Crypto.com, contained a survey of 3,053 people conducted from February to March 2021. According to the survey results, 51 percent of the respondents said a lack of knowledge is the main barrier to the adoption of open-source cryptocurrencies like Bitcoin and Ethereum (ETH), while 34% of survey participants cited security concerns as the main obstacle, and 29% indicated difficulties in knowing where to buy crypto.

Sidharth Sogani, founder of CREBACO, Credit Rating for Exchanges Blockchain and Coin Offering, who handles a team of professionals and blockchain entrepreneurs who audit projects related to bitcoin, explained: “The Indian audience has an orthodox mindset and are not very open to interventions. Besides, cryptocurrency is an unprecedented technology. Various new sources have ulterior motive of selling their product. There is also reluctance by the Indian government. Government motivation and regulation can motivate more people to venture into it.”

Safety and security issues prevent many from investing.

Mr Gajendra of Arokia IT Private Limited, an IT company in Bengaluru, said: “Citizens contemplate possible security issues such as hacking, which prevent them from investing in the technology. Above all, nobody knows which currency to invest in. Most have no idea that cryptocurrency comes under blockchain technology.”

Indians can only comprehend physical currency.

Atul Poddar, an economics teacher and director of Lotus Circle Study Centre, explained: “Even I invest in cryptocurrencies. I have observed that most people in India invest only to sell when the value goes up. It is not a daily-use currency for them  since it does not have a physical value. Only El Salvador has approved it for commercial use. Educated people in the field of tech have wider acceptance for virtual currency. The rest prefer money in hand. Maybe legal compliance can be the key to wider recognition and acceptance.”

Amid rising concern over the serious threats to the macroeconomic and financial stability of the country, the government on November 23 listed The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, to be introduced in the winter session of Parliament. It seeks to ban all private cryptocurrencies, with some exceptions and aims to create a facilitative framework for the creation of the official digital currency to be issued by the Reserve Bank of India. This means no person shall mine, buy, generate, hold, sell, deal in, issue, transfer, dispose of or use a cryptocurrency.

chhavi.v@iijnm.org

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