Bitcoin moved up in value — crossing $60000 in March 2021. It has been a bull run for a year where its value has appreciated by 80 per cent. Such a steep rise has made it a favourite topic of discussion for investors and financial analysts. One of the reasons for this spectacular rise is its acceptance by prominent organisations such as Tesla, PayPal, Visa, BNY Mellon, BlackRock, MasterCard. As cryptocurrencies are decentralised, these can be transferred through non-banking channels. Bitcoin supply is fixed and these are traded and registered on a ledger. Cryptos are still evolving, and these are early days.

As these are net regulated or issued by the government, its future is still uncertain. The Indian Bill that is proposed may affect the cryptos adversely. India can have its own digital currency issued by the RBI. China has already done this. Here trading happens on the blockchain.

A young nation such as India has attraction for cryptos. Dubious crypto transactions are a concern. RBI banned cryptos in 2018. However. the SC lifted the ban in March 2020. Since then crypto are being traded in India.

When music became digital, it affected the music industry adversely. Almost to the point of destruction. Music compression led to MP3 in the 1990s. There was file sharing and CD making. In the coming decade starting from 2001, the global revenue of music industry declined from $ 24 billion to $ 15 billion in 2011. The revenue then rose again in 2016, to reach $ 20 billion currently. Music industry has created a new eco-system — there are streaming applications, short-video apps, and social media. It has made monetisation of the IP easier. Thus digitisation is now helping music industry to revive.

Over 2/3rd of the revenues come from streaming music. Short-video apps have created a new revenue stream. There is less music piracy now, as people do not browse on the internet for song but have shifted to the app-based consumption. These apps have introduced transparency and have enhanced monetisability. The value of music libraries have been unlocked. The song gets per play rate, ranging from 4 paise to 10 paise. When the song is played as a part of paid service, the label gets a revenue share. Payments are linked to trackability of a song. Investment has been made on digitising the libraries of music companies.

Artistes and music companies which own the IP are paid by the streaming music companies and short-video apps. Music companies license their collection of songs. Thus there are earnings from existing and new music both for the labels and the individual artistes. IPRS collects royalties on behalf of lyricists and composers. In 2020, IPRS distributed Rs.170 crore.

The changed music industry discovers and promotes new talent.

According to Nandan Nilkeni, cryptocurrencies are acceptable as a store of value but these are not ideal for transactions. It will never be able to meet the transactional efficiency of UPI in India which deals with 2.3 billion transactions a month, and the architecture is for 1billion transactions a day at almost zero cost. Bitcoin can never compete with UPI on transactional efficiency. It could be considered as a store of value. It can be thought of as an asset class, such as gold and real estate. These can be regulated by some rules. RBI can think of a digital rupee, and can use UPI architecture to distribute it. This architecture allows multiple stored-value accounts. UPI thus can have a bank account, a wallet, a bitcoin account or an account for digital rupee.

As early as July 2021, the officials at the Federal Reserve Bank of Boston and MIT would like to have prototypes for a digital dollar. The project is in progress. Bankers feel threatened by this disruptive development, and say that a digital dollar is not needed. MasterCard and Visa are ready to work with it. This electronic alternative to paper bills, whether called a digital dollar or Fedcoin, have not yet been approved by the lawmakers and the US Treasury Department officials. It thus could be years away.

Cryptocurrency is virtual currency, and bears a unique code. These are coins created by solving mathematical puzzles using computer power. This process is called mining. They are stored in wallets which are digital directories accessed through passwords. These coins could be broken into smaller units, say a hundredth-millionth of a coin.

Cryptos are not controlled by a central authority. They are crowd-controlled through an electronic ledger called blockchain. A proposed transaction is verified through it. When majority of blockchain viewers agree, coin no. xxx can be transferred from Wallet X to Wallet Y. The transaction is cleared, and a new entry is made in blockchain.

Most cryptocurrencies are not pegged to any asset. Stable-coins may be linked to either the US dollar or a basket of currencies.

Cryptos are used in transactions, but not usually. They are used in foreign trade, gaming and online casinos. As they are hard to trace by the authorities, they are used in shady deals.

Cryptocurrencies are traded in multiple currencies on many platforms. Cryptos are extremely volatile. Their transactions are slow — before a transaction is vetted, many people have to see it. It is, therefore, hard to use cryptos for common transactions.

Cryptocurrencies are not suitable for traditional banking. In traditional banking, cash credit or bank money is created. It is not possible to create cash credit with cryptos. Each coin has a unique code and lending means transferring the coin with that unique code. Bank money is just a notional entry.

Each coin’s history is recorded from its mining stage to its various transactions in blockchain. Every proposed transaction must be confirmed by the majority viewing it. After its acceptance by the majority, it is entered in a blockchain.