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Bitcoin will revolutionize payment procedures worldwide

Bitcoin is the world’s most robust cryptocurrency, also known as digital gold, for its ability to retain value. Even after being damaged by the difficult conditions of 2022, it still managed to regain a significant portion of its former glory. Unfortunately, things have now begun stagnating again, and the price is struggling to climb above the $30k zone. Nevertheless, many investors have continued to buy Bitcoin and add it to their portfolios as a means to protect their holdings against the perils of inflation.

There’s also increasing discourse surrounding the coin’s ability to help within different business areas and sectors by making procedures fairer and more transparent. Since the blockchain is naturally associated with financial transactions, it only makes sense that it will play a role in the world of traditional finance as well.

Global payments

The most significant advantage of the blockchain is its speed, regardless of the time of day or geolocation. All transactions happen quickly, something that businesses can benefit from. In today’s competitive market, entrepreneurs need to use all the weapons at their disposal to ensure their enterprise grows. Some analysts currently believe that, compared to the universal protocol that allows information and data to be transferred between different parties safely and securely, technology has lagged behind in finding similar solutions for payments.

Currently, if you want to send money to someone from a different country without access to the same fintech apps, you either won’t be able to do it or will only succeed in performing this task after serious troubles. According to this point of view, society is still more or less stuck in the fax era of payments. Moreover, time considerations are essential. While you could solve the app availability issues by going to your local bank, most tend to be closed after 5 p.m. and during the weekends.

In the beginning, Bitcoin was created to act as fiat currency and power daily transactions the same way as coins and banknotes do during day-to-day life. However, this hasn’t come to pass, and the reverse actually occurred. Bitcoin is now considered a scarce and highly valuable asset that is part of the portfolios of many investors throughout the world. In this sense, analysts currently believe that Bitcoin will be ultimately used for overseas transfers in the future rather than for more mundane tasks such as online shopping or paying at the cashier in a supermarket.

Since it can operate outside time and border considerations, it can be employed in transferring currencies anywhere in the world. For instance, if someone from the United States sends dollars to Japan, the person who receives the money will convert it to the Japanese yen or the euro. There’s also something to be said about the fact that real-time payments are much more cost-effective when performed through the blockchain, helping further cost-reduction strategies.

Indian legislation

Crypto platforms in India are on their way to receiving the status of authorized dealers in the country. The move will be part of changes brought by the guidelines issued by the Indian Central Bank. India is operating within the same regulatory framework issued by the International Monetary Fund and the Financial Stability Board. The regulations could result in the development of legal legislation over the course of the following five or six months.

The latest G20 Summit held in New Delhi between the 9th and the 10th of September concluded with several economic announcements. The most important from the point of view of the cryptocurrency community relates to the recommendations made through the joint suggestions brought by the IMF and the FSB. Both India and the other G20 nations welcomed the plans. So, what could the Indian government be expected to focus on going forward? Some of the strategies could include:

  • Know Your Customer strategies are designed specifically for cryptocurrency companies, which would cover the Foreign Account Tax Compliance Act, as well as abide by Anti-Money Laundering standards.
  • It will become mandatory for digital finance platforms to release proof-of-reserve audits directly to regulators and on a real-time basis.
  • Taxation policies will become consistent throughout the entire country.
  • There will be mandatory positions on the crypto platforms, such as trained officers that can watch out for, report and solve any money laundering incidents.
  • Under the rules and principles issued by the Central Bank, exchanges would benefit from the same status as authorized providers dealing with traditional finance processes.

The framework

But what exactly is the legal framework for crypto adopted at the G20 summit? The most important aspect has to do with creating a framework that can facilitate the transfer of information between the nations beginning in 2027. Known as the Crypto-Asset Reporting Framework, the world leaders asked for the immediate implementation of the amendments within a coordinated timeline determined by the Global Forum on Transparency and Exchange of Information.

Numerous countries will be directly affected, including Japan, South Korea, Australia, Argentina, South Africa, Germany, China, Saudi Arabia, Italy, Indonesia, France, Brazil and Canada. The European Union, United States, Turkey and the United Kingdom will notice the changes that come with the frameworks as well. This is incredibly relevant, considering that roughly two-thirds of the world’s population lives in a G20 country.

The existing framework was first introduced in October 2022 by the Organization for Economic Cooperation and Development. The initial document included an original design to provide better visibility into crypto transactions, ease taxation efforts and help the individuals operating in the field of digital finance. With the new updates, nations will also exchange information related to the transactions between different jurisdictions.

This is just the latest of the series of regulatory changes that have swept the cryptocurrency space in 2023. The new rules also stipulate that the digital asset transfer should be accompanied by the beneficiary’s name, ledger address and account number. Cryptocurrencies are set to enter the mainstream, meaning that they will also be subjected to increased supervision.

The cryptocurrency market has changed many times throughout its relatively short history. In fact, the space is well-known for its ability to foster innovation. It might be that it is finally reaching its finished form.

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