What is cryptocurrency , how does it work & why it's illegal in Nepal?

Cryptocurrency, sometimes called crypto-currency or crypto, is any type of digital currency that is or is likely to use cryptography to secure transactions. Cryptocurrencies do not have a major issuing or controlling authority, instead they use a state-class system to record the occurrence and release of new units.

What is cryptocurrency?

Cryptocurrency is a digital payment system that does not rely on banks to verify transactions. It is a peer-to-peer program that can anyone anywhere send and receive payments. Instead of virtual currency being traded and traded in the real world, cryptocurrency payments exist as a digital deposit on an online website that describes a specific transaction. When you transfer cryptocurrency funds, transactions are recorded in the public booklet. Cryptocurrency is stored in digital wallets.

Cryptocurrency got its name because it uses encryption to verify transactions. This means that advanced coding is involved in storing and transmitting cryptocurrency data between wallets and public accounts. The purpose of confidentiality is to provide security and safety.

The first cryptocurrency was Bitcoin, which was introduced in 2009 and is still very popular today. The biggest interest in cryptocurrensets is trading for profit, with speculators sometimes pushing prices up.

How does cryptocurrency work?

Cryptocurrencies operate on a widely distributed public book called blockchain, a record of all transactions renewed and maintained by investors.

Cryptocurrency units are created by a process called mining, which involves the use of computer power to solve complex mathematical problems that generate coins. Users can also purchase coins from merchants, and then store and use them using cryptographic wallets.

If you own a cryptocurrency, you have nothing tangible. Yours is the key that allows you to move a record or unit of measurement from one person to another without a trusted third party.

Although Bitcoin has been around since 2009, cryptocurrencies and the use of blockchain technology are still emerging financially, and more use is expected in the future. Jobs that include bonds, stocks, and other financial assets may eventually be traded using technology.

Examples of Cryptocurrency

There are thousands of cryptocurrencies. Some of the most popular ones include:

Bitcoin:

Bitcoin was launched in 2009, the first cryptocurrency and is still the most commonly traded. This type of coin was invented by Satoshi Nakamoto - widely believed to be the pseudonym of an individual or a group of unknown individuals.

Ethereum:

Developed in 2015, Ethereum is a blockchain platform with its own cryptocurrency, called Ether (ETH) or Ethereum. The most popular cryptocurrency behind Bitcoin.This currency is very similar to bitcoin but has gone faster to develop new features, which include faster payments and procedures to allow for more transactions.

Ripple:

Ripple is a widely distributed loan program launched in 2012. Ripple can be used to track different types of transactions, not just cryptocurrency. The company behind it has worked with various banks and financial institutions.

Why cryptocurrency is illegal in Nepal ?

Nepal Rastra Bank has officially declared Bitcoin and other cryptocurrencies as illegal forms of financial tender, in its statement to restrict Bitcoin and its transaction quoting two rules, the 2019 BS foreign exchange law and the NRB Act 2058 BS . Basically, it says you can't do bitcoin transaction in Nepal or use bitcoin to exchange foreign or Nepali currency, because bitcoin is not classified as currency by the Nepali Government, so using an online bitcoin transactions or exchange is illegal. The Nepalese government is examining the creation of a government-backed digital currency issued by the RBI, while blocking private ones like Bitcoin. This is normal

Nepal, as the current laws related to money are squeezing out the country's money supply. Very few accepted opportunities always make foreign investment impossible. This will really stop the flow of digital money.