 "From dentistry to sex trade, Bitcoin bug bites Indian entrepreneurs")
Amid a crazy price surge seen in recent times, investors are not the only lot hooked to the Bitcoin frenzy. Thanks to the business potential that the cryptocurrency has opened up directly or indirectly, many Indians across the spectrum are rushing to set up companies and cash in on the craze.
At least a dozen companies, including some in the past few weeks, have been registered in various parts of the country with 'Bitcoin' as part of their names. And, many more such applications are pending with the Registrars of Companies (RoCs).
While the number of applications with 'crypto' in their names is even higher, there also are more innovative ones who have added prefixes to the word 'coin' to come up with names like 'IndiCoin' and 'BharatCoin', even 'SwachhCoin'!
The mad rush of entrepreneurs and investors seems to be continuing despite repeated regulatory warnings against Bitcoins and their various alternatives operating in a totally unregulated domain and the possible money-laundering and terror-financing risks associated with such cryptocurrencies.
Various regulators and enforcement agencies are already actively looking into this Bitcoin craze. Searches by tax authorities were conducted recently at several places and details are believed to have been collected about hundreds of thousands of 'investors' who might be trading on 'Bitcoin exchanges'.
There are concerns that many operators might be running 'e-ponzi' schemes or illicit money-pooling pyramid activities in the name of virtual currencies. Some bogus ones have already been unearthed and are facing police action.
As the regulators and the government departments continue with their probes, which officials at these agencies also described as their efforts to 'understand' this new phenomenon, entrepreneurs seem to be undeterred by any risk factors. Operating from various parts of the country -- from Ghaziabad to Kanpur, Darjeeling and Jaipur to Delhi, Ahmedabad and Mumbai – they expect good business to come by.
The RoC filings made by such companies show diverse business activities that they propose to undertake – One has listed 'retail trade/repair of personal and household goods'; another claims to be in the financial intermediary business; yet another claims to promote 'investigative journalism'.
There are also those offering 'crypto coins' exclusively for dentistry across the world with the promise of removing middlemen-type costs and providing easier insurance claims! Then, there are also those proposing 'sex coins' for discreet payments for adult entertainment and in sex trade.
A number of new entities have been set up under the LLP (Limited Liability Partnership) model while many others are being set up as privately held companies. Several officials from the auditing and accountancy fields also said many listed companies were looking into changes in their names and 'articles of association' to include 'Bitcoin' or other cryptocurrencies, to join the bandwagon.
There also are several entities operating only in the digital world by setting up websites or 'online exchanges' and those that have gone in for registering their companies or LLPs.
According to the RoC data, the registered entities include Bitcoin Bazaar, Bitcoin Exchange, Bitcoin Finconsultants, Bitcoin India Software Services, Bitcoin Services India, Bitcoiners India, Bitcoins India and Bit Coin Infotech.
Besides, there are Crypto Advisors, Crypto Futuristic Trades, Crypto Infotech, Crypto IT Services, Crypto Labs, Crypto Mining, Crypto Yo Coin India, CryptoCoin Solutions and CryptoMudra Digital Services. Further business details of these entities could not be ascertained, as most of them have been set up recently but are meeting necessary compliances.
While Bitcoin was created as a cryptocurrency in 2009, by an unidentified person using the alias Satoshi Nakamoto, its popularity has grown manifold in recent months with its per-unit price soaring to close to $20,000 (over Rs 10 lakh) earlier this month. However, the price has been swinging wildly; only last week, it fell by almost half to about $10,000, only to again rebound to the nearly $15,000.
Launched with a promise of lower transaction fees than traditional payment methods, with a decentralised authority unlike the government-issued currencies in various countries, Bitcoins currently command a market cap of over $240 billion. More than 16 million of its units are said to be in circulation. The maximum supply is pegged at 21 million.
It is the anonymity of Bitcoins, minted through complex computer algorithms, that has made them so famous. But it is the same anonymity that has also increased the associated risks. These are stored in digital wallets, on cloud or on user computers.
The popularity of Bitcoin has also given rise to several other such cryptocurrencies globally, even as several entities and exchanges have gone bust with huge losses. No such currency has so far got a legal tender status from any central bank or government in the world, but some are being accepted, mostly for online trades and transactions like ordering pizza.
These 'coins' are minted and traded with the use of blockchain technology, which uses cryptography for security of exchanges and providing a decentralised 'digital ledger' of transactions for all on the network to see.
Blockchain is a distributed ledger technology algorithm for managing digital cash without any central administrator and users remain unaware about each other. One blockchain network typically has thousands of nodes and a transaction is verified only after a majority of nodes reaches a consensus.
At least a dozen companies, including some in the past few weeks, have been registered in various parts of the country with 'Bitcoin' as part of their names. And, many more such applications are pending with the Registrars of Companies (RoCs).
While the number of applications with 'crypto' in their names is even higher, there also are more innovative ones who have added prefixes to the word 'coin' to come up with names like 'IndiCoin' and 'BharatCoin', even 'SwachhCoin'!
The mad rush of entrepreneurs and investors seems to be continuing despite repeated regulatory warnings against Bitcoins and their various alternatives operating in a totally unregulated domain and the possible money-laundering and terror-financing risks associated with such cryptocurrencies.
Various regulators and enforcement agencies are already actively looking into this Bitcoin craze. Searches by tax authorities were conducted recently at several places and details are believed to have been collected about hundreds of thousands of 'investors' who might be trading on 'Bitcoin exchanges'.
There are concerns that many operators might be running 'e-ponzi' schemes or illicit money-pooling pyramid activities in the name of virtual currencies. Some bogus ones have already been unearthed and are facing police action.
As the regulators and the government departments continue with their probes, which officials at these agencies also described as their efforts to 'understand' this new phenomenon, entrepreneurs seem to be undeterred by any risk factors. Operating from various parts of the country -- from Ghaziabad to Kanpur, Darjeeling and Jaipur to Delhi, Ahmedabad and Mumbai – they expect good business to come by.
The RoC filings made by such companies show diverse business activities that they propose to undertake – One has listed 'retail trade/repair of personal and household goods'; another claims to be in the financial intermediary business; yet another claims to promote 'investigative journalism'.
There are also those offering 'crypto coins' exclusively for dentistry across the world with the promise of removing middlemen-type costs and providing easier insurance claims! Then, there are also those proposing 'sex coins' for discreet payments for adult entertainment and in sex trade.
A number of new entities have been set up under the LLP (Limited Liability Partnership) model while many others are being set up as privately held companies. Several officials from the auditing and accountancy fields also said many listed companies were looking into changes in their names and 'articles of association' to include 'Bitcoin' or other cryptocurrencies, to join the bandwagon.
There also are several entities operating only in the digital world by setting up websites or 'online exchanges' and those that have gone in for registering their companies or LLPs.
According to the RoC data, the registered entities include Bitcoin Bazaar, Bitcoin Exchange, Bitcoin Finconsultants, Bitcoin India Software Services, Bitcoin Services India, Bitcoiners India, Bitcoins India and Bit Coin Infotech.
Besides, there are Crypto Advisors, Crypto Futuristic Trades, Crypto Infotech, Crypto IT Services, Crypto Labs, Crypto Mining, Crypto Yo Coin India, CryptoCoin Solutions and CryptoMudra Digital Services. Further business details of these entities could not be ascertained, as most of them have been set up recently but are meeting necessary compliances.
While Bitcoin was created as a cryptocurrency in 2009, by an unidentified person using the alias Satoshi Nakamoto, its popularity has grown manifold in recent months with its per-unit price soaring to close to $20,000 (over Rs 10 lakh) earlier this month. However, the price has been swinging wildly; only last week, it fell by almost half to about $10,000, only to again rebound to the nearly $15,000.
Launched with a promise of lower transaction fees than traditional payment methods, with a decentralised authority unlike the government-issued currencies in various countries, Bitcoins currently command a market cap of over $240 billion. More than 16 million of its units are said to be in circulation. The maximum supply is pegged at 21 million.
It is the anonymity of Bitcoins, minted through complex computer algorithms, that has made them so famous. But it is the same anonymity that has also increased the associated risks. These are stored in digital wallets, on cloud or on user computers.
The popularity of Bitcoin has also given rise to several other such cryptocurrencies globally, even as several entities and exchanges have gone bust with huge losses. No such currency has so far got a legal tender status from any central bank or government in the world, but some are being accepted, mostly for online trades and transactions like ordering pizza.
These 'coins' are minted and traded with the use of blockchain technology, which uses cryptography for security of exchanges and providing a decentralised 'digital ledger' of transactions for all on the network to see.
Blockchain is a distributed ledger technology algorithm for managing digital cash without any central administrator and users remain unaware about each other. One blockchain network typically has thousands of nodes and a transaction is verified only after a majority of nodes reaches a consensus.