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India From types to tax a cryptocurrency primer

India From types to tax a cryptocurrency primer

MUMBAI: Rebounded after a sudden fall triggered apparently by a ‘bitcoin-exchange’ halting trade due to technical reasons, which led to panic selling over fears that the ‘bitcoin bubble’ was about to burst. A look at how the cryptocurrency market works.

A digital currency exchanged entirely over the internet. All information on its creation, transactions and validation of authentic exchange is secured through cryptography, the art of making codes. Most of these currencies are decentralised. Unlike a central banking system, which controls money supply, the creation of cryptocurrencies is public. Further, no central authority can interfere in setting its value, which is decided purely by market forces.

Website coinmarketcap.com, which tracks such currencies, says there are 1,355 cryptocurrencies being traded in 7,399 markets. As on December 14, the total value (market capitalisation  price multiplied with currency in circulation) of these currencies was $514 billion. Bitcoin, the oldest cryptocurrency, dominates with over 54% market share.