there was an Indian who in 2009 traveled
to the US and this guy fell in love with
an American girl he wanted to propose to
her and she was in love with him as well
for some reason the engagement bra did
not happen he broke up with her or she
broke up with him and then he was left
with a $1,600 ring but really expensive
but he didn’t know what to do with it
and he just wanted to ride in the trash
at the same time a colleague at work
came to him and said let me give you
20,000 bitcoins that I own they’re very
valuable his friends at work warned them
they said this guy has been trying to
get rid of his 20,000 bitcoins which is
worth nothing for the last six months
nobody will buy it from him do not buy
the bitcoins from him but this guy said
I’m gonna throw my wedding ring anyway
why not give it to him so he can have it
make use of it maybe give it to his
girlfriend I’ll take whatever he gives I
don’t need the twenty thousand bitcoins
they worth nothing I know but I just
take it doesn’t matter to me lo and
behold nine years down the line the
twenty thousand bitcoins that he just
got it just he just he didn’t want to
keep it but he just got it and he
thought it was worth nothing it’s not
worth a hundred and eighty million
dollars US dollars
Indian rupees that’s one thousand one
hundred and fifty six crore as of
today’s value my friends let me present
the topic of cryptocurrencies I’m sure
everyone in the audience has heard one
way or the other about bitcoins Bitcoin
is one of the examples of
cryptocurrencies
before we start let me give you some
famous word from around the globe
Bitcoin is a combination of a bubble a
Ponzi scheme and an environmental
disaster it can’t get much worse than
this
people either love Bitcoin or they’re
either day they hate it mostly you’ll
find haters except the ones who’ve made
some money out of it most of these
tokens not have real Italy most of them
do not are not different from others in
the long run they’re think there’s going
to be only digital gold one digital gold
so this person thinks Barry Silbert from
coin desk he thinks that there is a
place for crypto currencies in the world
but there’s only place for one crypto
currency it’s similar to only one gold
one commodity that rules the world in
terms of digital currencies only Bitcoin
can rule the world so he’s sort of
optimistic but not optimistic about all
the cryptocurrencies will go into the
lead into into details you know a little
bit further but let me give you some
famous words from around the globe the
price of Bitcoin is set to hit a hundred
thousand dollars one Bitcoin mind you
that’s about 65 lakh rupees as of today
in 2027 right now if you don’t know it’s
worth about $8,000 this is not a fad
cryptocurrencies are here to stay they
will they will emerge the three main
ones Bitcoin will be one of those says
an analyst from A to Z Forex Warren
Buffett the world famous investor the
world’s biggest investor the most famous
one says on cryptocurrencies that he
could save it almost also a full
certainty that they will come to a bad
ending if Warren Buffett himself the god
of investing says that who are we mere
mortals to disagree with him right
you never nel times have changed the
world has changed it’s it’s now the
world of cryptocurrencies blockchain
Bitcoin yttrium and all of that let me
give you a little bit of background on
what all these you know these buzzwords
mean a blockchain is a shared public
ledger some of you here I mean I know
it’s an engineering college I know some
of you may know about you know something
about accounting when you have an
accounting you have a ledger you have a
debit a credit for example you know you
go to a shop he gives you a commodity
you pay him money so for you it’s a
debit for him it’s a credit you know so
on and so forth so that’s how it’s been
happening for hundreds of years you know
since a man invented barter then you
know mercantile and then you know the
Industrial Age and all of that and cut
to today you have blockchain which is
nothing but a shadow black ledger
secured by cryptography by use of a
public and private key attached to every
message in the chain to verify its
authenticity
so what happens you know what basically
blockchain blockchain is nothing but
it’s a series of messages which are our
cryptid by a public and a private key so
for example like I said before you have
a credit a debit for each transaction
right each of these is a message that is
cryptid that is secured by way of a
public and a private key which makes it
extremely secure when it comes to online
transactions all of us know that none of
these transactions are secure
you know if someone takes your you know
steals your wallet it’s gone I mean
anybody could use it I mean obviously
you have an OTP system which is
implemented here but that’s not
implemented around the globe it since
the Indian you know financial system is
relatively new you haven’t you know it’s
it’s a fee it’s it’s fairly more secure
and a more sophisticated than even the
United States I know where I come from
so although there are some ways in which
you could secure your physical wallet
the digital wallet which is basically
enabled by the blockchain is much much
more secure I won’t go into a lot of
details but I’m just giving you you know
sort of a high-level overview of what
the blockchain is each blockchain is
time-stamped so if if you have a
transaction if you want is if you know
if if you’re Tom and if you want to send
Harry ten dollars or ten you know 100
rupees all you do is you log into your
digital wallet you initiate the
transaction and each transaction is
secured by a public and the private key
and it’s time-stamped which means nobody
can go in and change that timestamp if
someone tries to do that if a hacker
comes in and if he tries to change the
timestamp that change is only tracked in
that one place
the entire transaction is broadcast to
minors across the globe who verify the
authenticity of this transaction and
when somebody finds that there is a
breach in one place because a hacker
cannot one time only change the the key
in one of the places what happens I mean
it’s easily caught by the other miners
and then that front that fraudulent
transaction is then negated so digital
wallet transactions are extremely secure
cryptocurrency cryptocurrency as the
name says it’s just currency it’s like
it’s like Indian repeats the US dollar
all of these are actual currencies which
are treated around the world and they
are you know you know banks garments are
authorized by their central governments
to trade in these various currencies and
then you have commodities like gold
silver so on
however cryptocurrency is a is a you
know was a very new concept back about
ten years ago when it was introduced it
did not find many takers
you know due to which its price kept
lagging lagging lagging until the last
few years when the price really started
going up the most important concept
about cryptocurrency that I want you to
know is that it is decentralized what
happens when you know when you know when
I have some you know when I need a
thousand rupees and I know from my from
my bank account I go to ATM where does
the money come to the ATM it comes from
the bank who prints the currency the
Reserve Bank
so the Reserve Bank is you know the
Reserve Bank and any World Bank you know
depending on the currency in the country
go to the money the money is printed by
the central bank the Treasury the
Treasury Department determines how much
currency needs to be printed the Reserve
Bank prints it distributed across the
country to print two different ATMs – I
know – the banks who differ who stock up
their ATMs the cryptocurrency is so what
I just described is a central model one
you know central bank prints the
currency it’s then distributed through
all into through a variety of channels
to the various banks however
cryptocurrency is
– beer if I have a Bitcoin and I need to
send it to you it’s only between you and
me and there are a few ways in which
bitcoins can be created
none of which involve a central bank a
government or a regulator it is
completely different from how it works
today and the reason for that is is that
for you know for the longest time people
have in I mean people behind the digital
currency have been frustrated with how
the world banks the regulator’s hold a
lot of power within them and you know
how in and they wanted to devise a way
in which this power could be distributed
more power to the public so this is what
cryptocurrency does it leverages the
blockchain technology to create a
virtual currency that is decentralized
and only exists it electronically you
may ask okay I have Paytm in my on my
phone I could use it
what’s the key difference the key
difference is the Paytm is still
dependent on money in your bank account
crypto currencies such as Bitcoin is
completely different it’s it is its own
currency
just like your rupee crypt a Bitcoin is
its own currency and you could buy
things I mean there are not many traders
across the world who will accept Bitcoin
right now but the situation is totally
slowly changing there are thousands and
probably millions of investors right now
when we’re investing in coins and which
is why the price of Bitcoin I’ll show
you shortly after this slide you know
has KY rocketed in the last one year but
before that a few facts every crypto
currency transaction is recorded on the
blockchain like I mentioned before every
transaction on the blockchain is highly
secure so it tracks who has how many
coins there if there are a thousand
Bitcoin investors the network clearly
knows who has how many coins and when
the transaction occurred because like I
said there’s a timestamp associated with
every transaction right there are over
1,500 crypto currencies transaction
cryptocurrencies transacted in over 80
500 markets in the world and that is
only today’s which is you know just
about 10 years after the first
cryptocurrency was introduced imagine
what’s going to happen in the next 10 20
years
it’s it’s gonna be it’s gonna blow your
mind the market cap of all
cryptocurrencies is over 420 billion
which is I would say still in its
nascent phase I mean it’s it’s it’s gold
going to trillions in the next few years
provided provided the world regulators
let that happen
but we’ll see that in a little while
bitcoin is the world’s predominant
cryptocurrency whose market cap is about
148 billion which puts it almost at 35
percent of the market cap of all kept
cryptocurrencies and the majority of the
1500 plus crypto currencies are expected
to lose their value complete your time
that is a given there are about less
than 10 cryptocurrencies which are very
popular they are created you know
they’re traded in large quantities but
then there are like I said over 1500 of
them which you know which you know even
you and I can start a cryptocurrency
it’s no it’s not a big deal it just you
know it’s a matter of mining them but
majority of them I expected to lose
their value so if you’re going to invest
in cryptocurrencies and if there is one
thing I want you to learn from this
session is this do not invest in you
know a cryptocurrency just because it is
cheap just like a cheap stock if you
invest in a cheap cryptocurrency you
know you’re going to lose money I mean
it’s it’s a given except short-term you
may gain some money but long-term you’re
going to definitely gonna lose their
money on that okay I know it’s not very
clear but what I’m trying to say here is
the top 10 cryptocurrency market
capitalizations like I said before
Bitcoin which is the which is the
world’s predominant cryptocurrency the
market cap is about 148 billion dollars
the price like I said before it’s about
eight hundred eight thousand seven
hundred and seventy dollars as of today
the February 13th the daily volume of
the number of bitcoins traded it’s about
16 million and
if you have been following the financial
market you would know that the over the
last two weeks the markets have behaved
in a very bearish manner the markets
have fallen pretty badly all the last
few days it’s you know it’s it’s made up
a little bit of that fall so bitcoins
prices have also trended similar to
stocks accept Bitcoin is much more
volatile than stocks okay this is you
know I’m sure this is the most you know
interesting slide of them all you see
how this this chart tracks the price of
Bitcoin over the last five years you see
how it is you know its it has beat
stagnating around you know for the
longest time and what a while you focus
is the you know around 2016 the price
was about four hundred and fifteen
dollars and July 2017 price started
going up why did the price start going
up nothing just speculation it’s like
eight will be hey I invested in one
Bitcoin and the price is expected to
double triple go ten times over the next
six months Beatles B buys it beat LC C
tells D and that’s how the story spreads
whether it’s true or not
that’s how speculation spreads and
that’s how the price of stocks used to
go up that’s exactly what’s happened to
Bitcoin as well so from a four and
fifteen dollars in 2016 the price had
the price climbed to nineteen thousand
five hundred dollars in December a
couple of months ago and that was the
that was the peak and if you know
anything about stocks you would know
that you know there are resistance at
every price point and twenty thousand
was the resistance price point so
Bitcoin did not touch that it then
started falling along with the rest of
the global markets the current price
like I said is about eight thousand
seven hundred and seventy dollars and it
goes along with the story that I’ve been
trying to tell you which is that Bitcoin
along with the rest of the
cryptocurrency market is extremely
volatile if you know
and I would highly recommend do not
spread any speculation you know about
Bitcoin because even the world’s world
world’s major bank CEOs have no idea
what bitcoin is gonna trend like in the
next several years although several
banks have started facilitating these
transactions right now like I said you
know none of the major banks facilitate
any of the Bitcoin transactions
everything happens we are you know small
private companies some companies went
bang one of the companies went bankrupt
because somebody stole a large number of
bitcoins you know this was a few years
ago when the transaction was not as
secure but now you know things have
become much more sophisticated so
Bitcoin transactions are much more
okay philosophically speaking what do
you think is the root of all evil in the
world if I have say one crore rupees
lying on the stage here what am I going
to do with it am I going to take it am I
gonna take it and then give it to the
poor am I gonna take it am I gonna hand
I’m gonna take it to the police
it’s anybody’s guess it depends on what
frame of mind I am in at that point in
time the opponent trying to convey is
that money is not the root of all evil
the eep the root of all evil is greed is
the situation that every person is in
and that’s what contributed to the price
volatility of Bitcoin over the last
couple of years nothing fundamentally
changed
it’s just that more people got to know
about it and more people got to know you
know people start just start spreading
the word and then everybody starts
buying price goes up and then more
people start buying and then the price
goes up further and at one point
everybody decides oh my god it’s gone up
so high so I’m going to take some
profits I’m going to sell some and then
some people start selling the price goes
down and then more people start selling
under the price crashes that’s what
so the most important thing is that as
more and more people you know want to
invest in Bitcoin and other
cryptocurrencies the most important need
is that you have to understand the
fundamentals you know behind how a
cryptocurrency works when you start
understanding the fundamentals you’ll
know that a cryptocurrency is just like
any other currency do you see the price
of Indian rupee fluctuating extremely I
know in a volatile manners like
the Bitcoin absolutely not why is this
happening to Bitcoin it’s just because
people treat it like a stock buy sell
buy sell buy sell doesn’t work like that
it’s a currency a currency is meant to
buy and trade things it’s not meant to
you know just trade trade rate which is
what is happening with Bitcoin there are
more transactions which are simply used
for trading then actually buying things
so you know that is a major problem with
with you know with Bitcoin and the rest
of the cryptocurrencies regulators have
been cracking down on cryptocurrencies
around the globe leading to extreme
price volatility let me take a local
example Supreme Court of India issued a
notice on 13th November 2017 to RBI and
related the financial ministries to
create a regulatory mechanism with
regard to Bitcoin right now people in
India invest in Bitcoin but it doesn’t
fall fall under any regulatory mechanism
and the RBI has started taking notice of
this you know they’re obviously aware
that people in India are investing in
Bitcoin but there is no mechanism you
can buy you know ten Bitcoin worth
$80,000 that’s about 50 lakh rupees
again I’m not trying on telling you you
should do this but you know people with
black money shadow banking what they can
do is they can they can invest in
Bitcoin and eventually they can convey
they can sell it and convert that to to
you know to whatever currency you want
and send it anywhere in the world and
that’s obviously called money laundering
and that is a major issue
Bitcoin which banks around the world are
having a hard time dealing with and
which is why it is very imperative for
for regulators around the globe to come
to terms with it as soon as possible
creates and regulations
around this and and and make sure P not
everybody you know is you know nobody in
the world is able to or at least in
their jurisdiction in their country is
able to trade in Bitcoin and anonymously
that’s the most important thing I mean
although there are like I said there are
time stamps and there are records in the
ledger for each transaction currently
garments do not know what’s actually
going on only people within the
blockchain mechanism the blockchain
ecosystem know what’s going on so that’s
that’s pretty much the problem most
government in the world are trying to
solve okay so that was the problems with
short-term volatility and you know the
reasons behind them longer-term like I
said before longer term the problem of
you know using crypto currencies to
finance illegal activities such as
terrorism cross-border financial crimes
money laundering the the risk is very
extremely high and the sooner World
Bank’s and irregular regulators around
the globe do something about it create
some regulatory mechanisms it’s it’s
going to be better for for everybody
around the world because you don’t want
people trading bitcoins and you know
primarily to finance illegal activities
there’s been a lot of you know good work
that’s happened over the last few years
but then there’s still many countries
which want to ban bitcoins purely
because they’re not able to track the
movement of cryptocurrencies around the
world taxes taxes are a major problem
with crypto currencies let me give an
example in the in the US about 7% of US
investors are expire
are known to hold Bitcoin but only 0.04
percent of those investors actually
declare their transactions on their tax
statements on the tax returns that’s a
major problem because you know since
banks don’t know what’s going on since
you you know central governments don’t
know what’s going on the IRS doesn’t
know what’s going on you get a you get a
free ride until the catch up and the
sooner they catch up it’s better for the
like I said before world regulators are
working on strictly regulating or
banning cryptocurrencies altogether so
if you can’t regulate something what
will you do it just ban it right but
that’s not the solution the solution is
to create proper laws proper regulations
too to create a mechanism where you know
people can legally trade in Bitcoin they
can be legally used to buy things and
you know across the world and it’s you
know if the if Bitcoin is used the way
it’s supposed to work which is one
currency for every person in the world
it’s good it will work very work
beautifully the problem is the
regulations the problem is people trying
to use it for short-term speculation try
to make some money
that’s not what it is for if it is if it
is use the reason for it it’s supposed
to be used for it’s going to be it’s
it’s it’s it’s gonna do wonders for the
world it’s gonna like I said before it’s
gonna place the power in in each
citizens hands rather than place the
power in one central bank which is what
the comments want but obviously the
popularity of the cryptocurrencies has
led to you know lot of investments even
you know major banks have started
investing in blockchain technology
because they don’t want to be left
behind
you know when when cryptocurrencies
catch up maybe in five years and they
become extremely popular and they’re
being used for or say twenty percent of
transactions across around the world
banks don’t want to be left behind
because then suddenly they will lose all
the fees that big so for example if you
want to transfer say one crore to the
u.s. to your friend right now you have
to pay a fee level it’s like a three
percent premium whatever it is when you
use cryptocurrency ion there is nothing
you just buy Bitcoin you transfer it to
your friend and that’s it absolutely no
fees but eventually you know when things
start getting regularized when the
regular step end when there’s a
ecosystem created for regulators to step
in at that point we will see that there
will be some fees involved but it’ll be
nothing like what we paid today it’s
going to be it’s going to be a very
beautiful world but obviously there’s a
lot of
hurdles to be crossed before we to reach
that stage and Wall Street and banks
like I just said um they haven’t
embraced cryptocurrencies you know
they’ve started the dyno acting they’ve
started allowing the trading of
cryptocurrencies but they cannot exert
full control over these transactions
that’s basically how you know blockchain
is supposed to work the control is not
is there’s no con there is no one person
who can control the blockchain it’s a
it’s a it’s a whole bunch of people who
come together they’re called miners who
verify each transaction via algorithms
and eventually it will lead to lower
transaction fees which the banks don’t
want right I mean all banks want to make
money as well and so banks have not
fully embraced blockchain technology as
well as cryptocurrencies but eventually
they will have to because otherwise
they’ll be left behind and then you know
it’s it’s it’s okay to make some money
rather than lose everything right so
that’s the the logic behind that
scalability so right now there are a few
top you know I’m just giving you a
Turing example there are a few thousand
of Bitcoin investors around the world
but long-term is that is the current
technology sufficient not really the
blockchain technology can process about
three transactions per second in Bitcoin
however visa the was you know one of the
world’s largest payment processes
processes about 2,000 transactions per
second so you can see there’s a huge gap
in scalability so if blockchain has to
you know adopt be adopted globally you
know the scalability is a huge challenge
there are you know there are several
strategies that are currently being
proposed and eventually I hope some of
these will will be adopted and then you
know and then Bitcoin can process much
more many more transactions than it is
able to process right now so there are
other smaller challenges there as well
but these are the major challenges which
cryptocurrencies are currently we are
facing and like I said when I say
Cristal cryptocurrencies the majority of
the market is owned by
Bitcoin so say two three four five years
down the line majority of these 1500
plus currencies are going to lose their
value Bitcoin along with a few other of
currencies will be the only ones that
are still holding value and eventually
the world you know the world’s major
players expect that Bitcoin will be the
only one which will be able to rival the
US dollar and gold that’s all I have so
if there is anything that you have two
that I want you to take away from this
presentation it is just that the term
bit coin the term cryptic cryptocurrency
blockchain is all in all these fancy
words have been you know I’ve been
thrown around and you know I’m sure
people want to learn about them people
who I know but the intention that they
want to create them and make some money
but that should not be your only
intention of getting into the Bitcoin
world I want you to learn the
fundamentals of how a Bitcoin works and
then try to use it for the purpose for
which it is meant to be used which is
actually transacting sending money
buying things and that is what will
sustain cryptocurrencies in the long
term and if it is simply being used for
trading make some quick bucks and then
take my money out of it it’s not going
to sustain it’s you know people are
going to lose money eventually because
nothing that goes straight up right
everything that goes up has to fall down
and if you if you caught at the point
where you bought at the peak and the
price falls down you know nobody wants
that right so that’s the only thing
that’s the that’s the number one thing I
want you to take away from this presentation so thank you very much
to the US and this guy fell in love with
an American girl he wanted to propose to
her and she was in love with him as well
for some reason the engagement bra did
not happen he broke up with her or she
broke up with him and then he was left
with a $1,600 ring but really expensive
but he didn’t know what to do with it
and he just wanted to ride in the trash
at the same time a colleague at work
came to him and said let me give you
20,000 bitcoins that I own they’re very
valuable his friends at work warned them
they said this guy has been trying to
get rid of his 20,000 bitcoins which is
worth nothing for the last six months
nobody will buy it from him do not buy
the bitcoins from him but this guy said
I’m gonna throw my wedding ring anyway
why not give it to him so he can have it
make use of it maybe give it to his
girlfriend I’ll take whatever he gives I
don’t need the twenty thousand bitcoins
they worth nothing I know but I just
take it doesn’t matter to me lo and
behold nine years down the line the
twenty thousand bitcoins that he just
got it just he just he didn’t want to
keep it but he just got it and he
thought it was worth nothing it’s not
worth a hundred and eighty million
dollars US dollars
Indian rupees that’s one thousand one
hundred and fifty six crore as of
today’s value my friends let me present
the topic of cryptocurrencies I’m sure
everyone in the audience has heard one
way or the other about bitcoins Bitcoin
is one of the examples of
cryptocurrencies
before we start let me give you some
famous word from around the globe
Bitcoin is a combination of a bubble a
Ponzi scheme and an environmental
disaster it can’t get much worse than
this
people either love Bitcoin or they’re
either day they hate it mostly you’ll
find haters except the ones who’ve made
some money out of it most of these
tokens not have real Italy most of them
do not are not different from others in
the long run they’re think there’s going
to be only digital gold one digital gold
so this person thinks Barry Silbert from
coin desk he thinks that there is a
place for crypto currencies in the world
but there’s only place for one crypto
currency it’s similar to only one gold
one commodity that rules the world in
terms of digital currencies only Bitcoin
can rule the world so he’s sort of
optimistic but not optimistic about all
the cryptocurrencies will go into the
lead into into details you know a little
bit further but let me give you some
famous words from around the globe the
price of Bitcoin is set to hit a hundred
thousand dollars one Bitcoin mind you
that’s about 65 lakh rupees as of today
in 2027 right now if you don’t know it’s
worth about $8,000 this is not a fad
cryptocurrencies are here to stay they
will they will emerge the three main
ones Bitcoin will be one of those says
an analyst from A to Z Forex Warren
Buffett the world famous investor the
world’s biggest investor the most famous
one says on cryptocurrencies that he
could save it almost also a full
certainty that they will come to a bad
ending if Warren Buffett himself the god
of investing says that who are we mere
mortals to disagree with him right
you never nel times have changed the
world has changed it’s it’s now the
world of cryptocurrencies blockchain
Bitcoin yttrium and all of that let me
give you a little bit of background on
what all these you know these buzzwords
mean a blockchain is a shared public
ledger some of you here I mean I know
it’s an engineering college I know some
of you may know about you know something
about accounting when you have an
accounting you have a ledger you have a
debit a credit for example you know you
go to a shop he gives you a commodity
you pay him money so for you it’s a
debit for him it’s a credit you know so
on and so forth so that’s how it’s been
happening for hundreds of years you know
since a man invented barter then you
know mercantile and then you know the
Industrial Age and all of that and cut
to today you have blockchain which is
nothing but a shadow black ledger
secured by cryptography by use of a
public and private key attached to every
message in the chain to verify its
authenticity
so what happens you know what basically
blockchain blockchain is nothing but
it’s a series of messages which are our
cryptid by a public and a private key so
for example like I said before you have
a credit a debit for each transaction
right each of these is a message that is
cryptid that is secured by way of a
public and a private key which makes it
extremely secure when it comes to online
transactions all of us know that none of
these transactions are secure
you know if someone takes your you know
steals your wallet it’s gone I mean
anybody could use it I mean obviously
you have an OTP system which is
implemented here but that’s not
implemented around the globe it since
the Indian you know financial system is
relatively new you haven’t you know it’s
it’s a fee it’s it’s fairly more secure
and a more sophisticated than even the
United States I know where I come from
so although there are some ways in which
you could secure your physical wallet
the digital wallet which is basically
enabled by the blockchain is much much
more secure I won’t go into a lot of
details but I’m just giving you you know
sort of a high-level overview of what
the blockchain is each blockchain is
time-stamped so if if you have a
transaction if you want is if you know
if if you’re Tom and if you want to send
Harry ten dollars or ten you know 100
rupees all you do is you log into your
digital wallet you initiate the
transaction and each transaction is
secured by a public and the private key
and it’s time-stamped which means nobody
can go in and change that timestamp if
someone tries to do that if a hacker
comes in and if he tries to change the
timestamp that change is only tracked in
that one place
the entire transaction is broadcast to
minors across the globe who verify the
authenticity of this transaction and
when somebody finds that there is a
breach in one place because a hacker
cannot one time only change the the key
in one of the places what happens I mean
it’s easily caught by the other miners
and then that front that fraudulent
transaction is then negated so digital
wallet transactions are extremely secure
cryptocurrency cryptocurrency as the
name says it’s just currency it’s like
it’s like Indian repeats the US dollar
all of these are actual currencies which
are treated around the world and they
are you know you know banks garments are
authorized by their central governments
to trade in these various currencies and
then you have commodities like gold
silver so on
however cryptocurrency is a is a you
know was a very new concept back about
ten years ago when it was introduced it
did not find many takers
you know due to which its price kept
lagging lagging lagging until the last
few years when the price really started
going up the most important concept
about cryptocurrency that I want you to
know is that it is decentralized what
happens when you know when you know when
I have some you know when I need a
thousand rupees and I know from my from
my bank account I go to ATM where does
the money come to the ATM it comes from
the bank who prints the currency the
Reserve Bank
so the Reserve Bank is you know the
Reserve Bank and any World Bank you know
depending on the currency in the country
go to the money the money is printed by
the central bank the Treasury the
Treasury Department determines how much
currency needs to be printed the Reserve
Bank prints it distributed across the
country to print two different ATMs – I
know – the banks who differ who stock up
their ATMs the cryptocurrency is so what
I just described is a central model one
you know central bank prints the
currency it’s then distributed through
all into through a variety of channels
to the various banks however
cryptocurrency is
– beer if I have a Bitcoin and I need to
send it to you it’s only between you and
me and there are a few ways in which
bitcoins can be created
none of which involve a central bank a
government or a regulator it is
completely different from how it works
today and the reason for that is is that
for you know for the longest time people
have in I mean people behind the digital
currency have been frustrated with how
the world banks the regulator’s hold a
lot of power within them and you know
how in and they wanted to devise a way
in which this power could be distributed
more power to the public so this is what
cryptocurrency does it leverages the
blockchain technology to create a
virtual currency that is decentralized
and only exists it electronically you
may ask okay I have Paytm in my on my
phone I could use it
what’s the key difference the key
difference is the Paytm is still
dependent on money in your bank account
crypto currencies such as Bitcoin is
completely different it’s it is its own
currency
just like your rupee crypt a Bitcoin is
its own currency and you could buy
things I mean there are not many traders
across the world who will accept Bitcoin
right now but the situation is totally
slowly changing there are thousands and
probably millions of investors right now
when we’re investing in coins and which
is why the price of Bitcoin I’ll show
you shortly after this slide you know
has KY rocketed in the last one year but
before that a few facts every crypto
currency transaction is recorded on the
blockchain like I mentioned before every
transaction on the blockchain is highly
secure so it tracks who has how many
coins there if there are a thousand
Bitcoin investors the network clearly
knows who has how many coins and when
the transaction occurred because like I
said there’s a timestamp associated with
every transaction right there are over
1,500 crypto currencies transaction
cryptocurrencies transacted in over 80
500 markets in the world and that is
only today’s which is you know just
about 10 years after the first
cryptocurrency was introduced imagine
what’s going to happen in the next 10 20
years
it’s it’s gonna be it’s gonna blow your
mind the market cap of all
cryptocurrencies is over 420 billion
which is I would say still in its
nascent phase I mean it’s it’s it’s gold
going to trillions in the next few years
provided provided the world regulators
let that happen
but we’ll see that in a little while
bitcoin is the world’s predominant
cryptocurrency whose market cap is about
148 billion which puts it almost at 35
percent of the market cap of all kept
cryptocurrencies and the majority of the
1500 plus crypto currencies are expected
to lose their value complete your time
that is a given there are about less
than 10 cryptocurrencies which are very
popular they are created you know
they’re traded in large quantities but
then there are like I said over 1500 of
them which you know which you know even
you and I can start a cryptocurrency
it’s no it’s not a big deal it just you
know it’s a matter of mining them but
majority of them I expected to lose
their value so if you’re going to invest
in cryptocurrencies and if there is one
thing I want you to learn from this
session is this do not invest in you
know a cryptocurrency just because it is
cheap just like a cheap stock if you
invest in a cheap cryptocurrency you
know you’re going to lose money I mean
it’s it’s a given except short-term you
may gain some money but long-term you’re
going to definitely gonna lose their
money on that okay I know it’s not very
clear but what I’m trying to say here is
the top 10 cryptocurrency market
capitalizations like I said before
Bitcoin which is the which is the
world’s predominant cryptocurrency the
market cap is about 148 billion dollars
the price like I said before it’s about
eight hundred eight thousand seven
hundred and seventy dollars as of today
the February 13th the daily volume of
the number of bitcoins traded it’s about
16 million and
if you have been following the financial
market you would know that the over the
last two weeks the markets have behaved
in a very bearish manner the markets
have fallen pretty badly all the last
few days it’s you know it’s it’s made up
a little bit of that fall so bitcoins
prices have also trended similar to
stocks accept Bitcoin is much more
volatile than stocks okay this is you
know I’m sure this is the most you know
interesting slide of them all you see
how this this chart tracks the price of
Bitcoin over the last five years you see
how it is you know its it has beat
stagnating around you know for the
longest time and what a while you focus
is the you know around 2016 the price
was about four hundred and fifteen
dollars and July 2017 price started
going up why did the price start going
up nothing just speculation it’s like
eight will be hey I invested in one
Bitcoin and the price is expected to
double triple go ten times over the next
six months Beatles B buys it beat LC C
tells D and that’s how the story spreads
whether it’s true or not
that’s how speculation spreads and
that’s how the price of stocks used to
go up that’s exactly what’s happened to
Bitcoin as well so from a four and
fifteen dollars in 2016 the price had
the price climbed to nineteen thousand
five hundred dollars in December a
couple of months ago and that was the
that was the peak and if you know
anything about stocks you would know
that you know there are resistance at
every price point and twenty thousand
was the resistance price point so
Bitcoin did not touch that it then
started falling along with the rest of
the global markets the current price
like I said is about eight thousand
seven hundred and seventy dollars and it
goes along with the story that I’ve been
trying to tell you which is that Bitcoin
along with the rest of the
cryptocurrency market is extremely
volatile if you know
and I would highly recommend do not
spread any speculation you know about
Bitcoin because even the world’s world
world’s major bank CEOs have no idea
what bitcoin is gonna trend like in the
next several years although several
banks have started facilitating these
transactions right now like I said you
know none of the major banks facilitate
any of the Bitcoin transactions
everything happens we are you know small
private companies some companies went
bang one of the companies went bankrupt
because somebody stole a large number of
bitcoins you know this was a few years
ago when the transaction was not as
secure but now you know things have
become much more sophisticated so
Bitcoin transactions are much more
okay philosophically speaking what do
you think is the root of all evil in the
world if I have say one crore rupees
lying on the stage here what am I going
to do with it am I going to take it am I
gonna take it and then give it to the
poor am I gonna take it am I gonna hand
I’m gonna take it to the police
it’s anybody’s guess it depends on what
frame of mind I am in at that point in
time the opponent trying to convey is
that money is not the root of all evil
the eep the root of all evil is greed is
the situation that every person is in
and that’s what contributed to the price
volatility of Bitcoin over the last
couple of years nothing fundamentally
changed
it’s just that more people got to know
about it and more people got to know you
know people start just start spreading
the word and then everybody starts
buying price goes up and then more
people start buying and then the price
goes up further and at one point
everybody decides oh my god it’s gone up
so high so I’m going to take some
profits I’m going to sell some and then
some people start selling the price goes
down and then more people start selling
under the price crashes that’s what
so the most important thing is that as
more and more people you know want to
invest in Bitcoin and other
cryptocurrencies the most important need
is that you have to understand the
fundamentals you know behind how a
cryptocurrency works when you start
understanding the fundamentals you’ll
know that a cryptocurrency is just like
any other currency do you see the price
of Indian rupee fluctuating extremely I
know in a volatile manners like
the Bitcoin absolutely not why is this
happening to Bitcoin it’s just because
people treat it like a stock buy sell
buy sell buy sell doesn’t work like that
it’s a currency a currency is meant to
buy and trade things it’s not meant to
you know just trade trade rate which is
what is happening with Bitcoin there are
more transactions which are simply used
for trading then actually buying things
so you know that is a major problem with
with you know with Bitcoin and the rest
of the cryptocurrencies regulators have
been cracking down on cryptocurrencies
around the globe leading to extreme
price volatility let me take a local
example Supreme Court of India issued a
notice on 13th November 2017 to RBI and
related the financial ministries to
create a regulatory mechanism with
regard to Bitcoin right now people in
India invest in Bitcoin but it doesn’t
fall fall under any regulatory mechanism
and the RBI has started taking notice of
this you know they’re obviously aware
that people in India are investing in
Bitcoin but there is no mechanism you
can buy you know ten Bitcoin worth
$80,000 that’s about 50 lakh rupees
again I’m not trying on telling you you
should do this but you know people with
black money shadow banking what they can
do is they can they can invest in
Bitcoin and eventually they can convey
they can sell it and convert that to to
you know to whatever currency you want
and send it anywhere in the world and
that’s obviously called money laundering
and that is a major issue
Bitcoin which banks around the world are
having a hard time dealing with and
which is why it is very imperative for
for regulators around the globe to come
to terms with it as soon as possible
creates and regulations
around this and and and make sure P not
everybody you know is you know nobody in
the world is able to or at least in
their jurisdiction in their country is
able to trade in Bitcoin and anonymously
that’s the most important thing I mean
although there are like I said there are
time stamps and there are records in the
ledger for each transaction currently
garments do not know what’s actually
going on only people within the
blockchain mechanism the blockchain
ecosystem know what’s going on so that’s
that’s pretty much the problem most
government in the world are trying to
solve okay so that was the problems with
short-term volatility and you know the
reasons behind them longer-term like I
said before longer term the problem of
you know using crypto currencies to
finance illegal activities such as
terrorism cross-border financial crimes
money laundering the the risk is very
extremely high and the sooner World
Bank’s and irregular regulators around
the globe do something about it create
some regulatory mechanisms it’s it’s
going to be better for for everybody
around the world because you don’t want
people trading bitcoins and you know
primarily to finance illegal activities
there’s been a lot of you know good work
that’s happened over the last few years
but then there’s still many countries
which want to ban bitcoins purely
because they’re not able to track the
movement of cryptocurrencies around the
world taxes taxes are a major problem
with crypto currencies let me give an
example in the in the US about 7% of US
investors are expire
are known to hold Bitcoin but only 0.04
percent of those investors actually
declare their transactions on their tax
statements on the tax returns that’s a
major problem because you know since
banks don’t know what’s going on since
you you know central governments don’t
know what’s going on the IRS doesn’t
know what’s going on you get a you get a
free ride until the catch up and the
sooner they catch up it’s better for the
like I said before world regulators are
working on strictly regulating or
banning cryptocurrencies altogether so
if you can’t regulate something what
will you do it just ban it right but
that’s not the solution the solution is
to create proper laws proper regulations
too to create a mechanism where you know
people can legally trade in Bitcoin they
can be legally used to buy things and
you know across the world and it’s you
know if the if Bitcoin is used the way
it’s supposed to work which is one
currency for every person in the world
it’s good it will work very work
beautifully the problem is the
regulations the problem is people trying
to use it for short-term speculation try
to make some money
that’s not what it is for if it is if it
is use the reason for it it’s supposed
to be used for it’s going to be it’s
it’s it’s it’s gonna do wonders for the
world it’s gonna like I said before it’s
gonna place the power in in each
citizens hands rather than place the
power in one central bank which is what
the comments want but obviously the
popularity of the cryptocurrencies has
led to you know lot of investments even
you know major banks have started
investing in blockchain technology
because they don’t want to be left
behind
you know when when cryptocurrencies
catch up maybe in five years and they
become extremely popular and they’re
being used for or say twenty percent of
transactions across around the world
banks don’t want to be left behind
because then suddenly they will lose all
the fees that big so for example if you
want to transfer say one crore to the
u.s. to your friend right now you have
to pay a fee level it’s like a three
percent premium whatever it is when you
use cryptocurrency ion there is nothing
you just buy Bitcoin you transfer it to
your friend and that’s it absolutely no
fees but eventually you know when things
start getting regularized when the
regular step end when there’s a
ecosystem created for regulators to step
in at that point we will see that there
will be some fees involved but it’ll be
nothing like what we paid today it’s
going to be it’s going to be a very
beautiful world but obviously there’s a
lot of
hurdles to be crossed before we to reach
that stage and Wall Street and banks
like I just said um they haven’t
embraced cryptocurrencies you know
they’ve started the dyno acting they’ve
started allowing the trading of
cryptocurrencies but they cannot exert
full control over these transactions
that’s basically how you know blockchain
is supposed to work the control is not
is there’s no con there is no one person
who can control the blockchain it’s a
it’s a it’s a whole bunch of people who
come together they’re called miners who
verify each transaction via algorithms
and eventually it will lead to lower
transaction fees which the banks don’t
want right I mean all banks want to make
money as well and so banks have not
fully embraced blockchain technology as
well as cryptocurrencies but eventually
they will have to because otherwise
they’ll be left behind and then you know
it’s it’s it’s okay to make some money
rather than lose everything right so
that’s the the logic behind that
scalability so right now there are a few
top you know I’m just giving you a
Turing example there are a few thousand
of Bitcoin investors around the world
but long-term is that is the current
technology sufficient not really the
blockchain technology can process about
three transactions per second in Bitcoin
however visa the was you know one of the
world’s largest payment processes
processes about 2,000 transactions per
second so you can see there’s a huge gap
in scalability so if blockchain has to
you know adopt be adopted globally you
know the scalability is a huge challenge
there are you know there are several
strategies that are currently being
proposed and eventually I hope some of
these will will be adopted and then you
know and then Bitcoin can process much
more many more transactions than it is
able to process right now so there are
other smaller challenges there as well
but these are the major challenges which
cryptocurrencies are currently we are
facing and like I said when I say
Cristal cryptocurrencies the majority of
the market is owned by
Bitcoin so say two three four five years
down the line majority of these 1500
plus currencies are going to lose their
value Bitcoin along with a few other of
currencies will be the only ones that
are still holding value and eventually
the world you know the world’s major
players expect that Bitcoin will be the
only one which will be able to rival the
US dollar and gold that’s all I have so
if there is anything that you have two
that I want you to take away from this
presentation it is just that the term
bit coin the term cryptic cryptocurrency
blockchain is all in all these fancy
words have been you know I’ve been
thrown around and you know I’m sure
people want to learn about them people
who I know but the intention that they
want to create them and make some money
but that should not be your only
intention of getting into the Bitcoin
world I want you to learn the
fundamentals of how a Bitcoin works and
then try to use it for the purpose for
which it is meant to be used which is
actually transacting sending money
buying things and that is what will
sustain cryptocurrencies in the long
term and if it is simply being used for
trading make some quick bucks and then
take my money out of it it’s not going
to sustain it’s you know people are
going to lose money eventually because
nothing that goes straight up right
everything that goes up has to fall down
and if you if you caught at the point
where you bought at the peak and the
price falls down you know nobody wants
that right so that’s the only thing
that’s the that’s the number one thing I
want you to take away from this presentation so thank you very much
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