Unocoin Archives

Did India and Venezuela together power the Bitcoin Bull Run?

Posted on January 13, 2017 | by [email protected]

From Mid 2016 Bitcoin has been forming higher highs and higher lows every month making the market overtly trendy. With Yuan devaluation helping the cause, Bitcoin prices were soaring high with ample opportunities for investing. The continuous rise in prices and reasonably acceptable volatility made Bitcoin one of the best performing assets of 2016. Perceivably, majority of the people believed that China was responsible for the steady increase in prices. But was that really the case? Apart from the visible factors, there were other global drivers of adoption that helped the cause. Let’s dive into what we believe are two major factors that pulled in the volumes:

Indian Demonetization:

Prime Minister Modi sought to fight corruption, a widespread problem in India, by pulling out higher denomination bills from circulation. Considering the country’s largely unbanked population, it was a brave move. During this phase, the government tried actively to pursue a cashless society while pushing for digital wallets and transactions. Many Bitcoin startups including Unocoin, Zebay and Buyucoin have experienced a surge in their transactions owing to the policy. This has set up the stage for the growth of Fintech startups in India and has put Bitcoin into motion. The transactions from the subcontinent contributed heavily to the boost Bitcoin has received towards the fag end of 2016.

Venezuela’s inflation:

Venezuela is one country that has received a knockout blow from the economic crisis of 2008 followed by the oil slum of 2014. The once prosperous oil-rich country is now struggling to provide citizens with the most basic needs of life. The 100-bolívar note is worthless because it is worth less than $0.03 outside of the government’s pricing system. Most people have in fact started weighing the notes instead of counting them to barter for its worth. Owing to this and to introduce higher currency notes that would have value and power of purchase, government is all set to withdraw 100 bolivar notes. This transition was the opening Bitcoin needed to etch its place in the heart of Venezuela’s economy.

How Bitcoin gained:

Both demonetization in India and hyperinflation in Venezuela had a serious side effect on the population. It undermined public confidence in national currencies as store of wealth. As in the case of any hyperinflation cycle, public has resorted to holding foreign currencies that are stable. While they have an array of varied options, Gold and Bitcoin stood out as safe assets. While Gold cannot be handled with ease, owing to Bitcoins ease of use, the currency saw inflow of funds from different phases that ended up powering the bull run.

Can Indian demonetization push Bitcoin prices higher?

Posted on November 15, 2016 | by [email protected]

The Prime Minister of India played a master stroke to flush out the ‘Black Money’ holders and non-taxpayers last week. In a surprise announcement, Narendra Modi revealed that the bigger denomination bills were banned starting from that date. For people who had bills in this denomination, it became mandatory to get them exchanged at the nearest bank. Let’s look into why this was a surgical strike on black money and how this can boost Bitcoin prices:

India and Corruption:

India is a country with a population closer to 1.4 Billion. It becomes complexly difficult to monitor the tax filings for all income groups. The Indian currency has Rs 1000 and Rs 500 bills as their biggest denominations. It is estimated that most of the money that is not accounted for taxation (popularly referred to as Black money) is stored in these denominations. Hence as a first lash on the prevalent corruption, the Prime Minister recalled bills of these denominations, replacing them with newer versions of the bill. For replacing older denominations, people would have to go to banks and get the money accounted for before replacing them. This has created quite a stir and great deal of discomfort for the Indian population, but the public has responded positively to this strategy with a tolerant mindset.

For people holding huge reserves of untaxed money, it is now mandatory to account it to get value in return. Else the reserves would go waste as the replacement of the existing denominations is scheduled only till December 31^st.

Bitcoin scenario in India:

The Reserve Bank of India has taken a neutral stance towards the cryptocurrency in 2013. They proclaimed that they are closely monitoring Bitcoin and would come to a conclusion only after fully understanding the technology. With the Bitcoin ecosystem in the country developing gradually, there is a strong possibility that this might boost the adoption. Companies like Unocoin, Zebpay and other wallet services have flourished organically in a set up that has been bending more towards e-commerce. On an average there is a volume transaction of 2051 BTC on Indian exchanges.

Anticipated affects:

In 2015, when China announced capital controls, it turned out to be a boost for Bitcoin prices. Even though India doesn’t have a strong hold in the Bitcoin domain, it has a comparable population. Over the past few months, the volumes of LocalBitcoins in India has been on the rise and shown a significant rise. With this move, the population is facing great discomfort as local banks and ATMs are flooded with people in a bid to withdraw money. It is only a matter of time, before we see wallet companies partnering with franchises to provide cashless services.

Bitcoin is Money: Federal Judge in US trial

Posted on September 21, 2016 | by [email protected]

Bitcoin had a strong opening this week making it third week in a row with the price over $600 level. But the support broke on 20^th September plummeting Bitcoin prices to late $590 level. Whether the fall in prices happened fundamentally or just a test of lower bands is non-conclusive. While the market speculation remains confusing, Federal Judge has ruled that Bitcoin is Money in Coin.mx case. Let’s look into the details of the ruling:

JP Morgan’s hack tied to Coin.mx case:

A federal judge in New York has ruled that bitcoin constitutes a form of money. The ruling comes from the ongoing case involving the now-defunct Florida bitcoin exchange Coin.mx. One of the former operators of the exchange, Anthony Murgio got indicted for alleged money laundering charges in July. He sought to dismiss two of the charges against him by arguing that bitcoins don’t count as “funds” in US.

However,Judge Alison Nathan of the Southern District Court of New York rejected that bid. She moved that bitcoin is money by virtue of its usage.

Nathan wrote in her ruling:

“Bitcoins are funds within the plain meaning of that term. Bitcoins can be accepted as a payment for goods and services or bought directly from an exchange with a bank account. They therefore function as pecuniary resources and are used as a medium of exchange and a means of payment.”

The Coin.mx case links to a broader investigation by the US government into an alleged cybercrime ring. This ring ties to a series of hacks on major companies and financial institutions, including Wall Street giant JPMorgan Chase. According to prosecutors, Coin.mx was a conduit for laundering proceeds from the purported operation.

Purse and Unocoin partner to increase adoption in India:

Bitcoin shopping platform Purse.io today announced a partnership with leading Indian cryptocurrency exchange Unocoin. Bitcoin use in India is growing rapidly, so Purse wants Indian residents to take advantage of its e-commerce platform. By the same notion, the company is trying to provide a seamless shopping experience for bitcoin users.

Amazon is steadily becoming one of the largest online marketplaces in India. The company also recently announced it would comply with Indian e-commerce rules. This allows greater foreign investment but restricts the discounts merchants can offer directly.

Purse leverages unspent gift card liquidity to provide Amazon discounts. The platform matches buyers with individuals who have illiquid gift card balances, then orders items at a discounted rate. The card holders receive bitcoin, which they can then exchange for rupees using Unocoin. This way Bitcoiners can get 15-22% discount on Amazon.

EU and Interpol to combat Bitcoin Money Laundering

Posted on September 13, 2016 | by [email protected]

The Bitcoin prices are trading in a sideways market, enjoying a long term confidence that the currency lacked previously. The adoption is on the rise and the currency is looking in its best shape of the past two years. Let’s see globally what has been happening on Bitcoin front that might have impact on prices:

Eu and Interpol launch Digital Currency working group:

Europol, the European Union’s top law enforcement agency, has co-founded a new working group dedicated to digital currencies. The initiative is being co-led by Interpol, the intergovernmental organization focused on law enforcement issues. The working group will involve the organization of collaborative workshops and a global network comprised of subject matter experts.

Europol said in a statement:

“Internet technologies become continuously more advanced, and so do the ways in which criminals utilize them for their illicit and illegal activities. Among these technologies, digital currencies are already transforming the criminal underworld.”

The group formed through a tripartite partnership between Europol , INTERPOL, and Basel Institute on Governance . The institute is a prominent intergovernmental organization that facilitates international police cooperation. The major focus of the group would be to tackle money laundering through virtual currencies.

Unocoin and LocalBitcoins: Two different stories:

Indian bitcoin exchange Unocoin recently announced its over-the-counter (OTC) marketplace. The company, founded in 2013, has over 90 thousand customers and a growth rate of 10-20% per month. It has launched two feature services, including OTC bulk trading and a new mobile application for iOS users. OTC markets are for traders who want to buy large amounts, without showing their transactions on public order books. Unocoin says it is continuing its mission to bring cryptocurrency feature services to the citizens of India.

While things look positive on Indian front, another Asian country bears a contrasting scenario. Russian authorities have banned LocalBitcoins after conflicting deliberation. The Russian Federal Service for Supervision of IT and Mass Communications, ‘Roskomnadzor’ has been instrumental in the ban. There has been a great debate in Russia over the status of Bitcoin with Government swaying towards negative policies. After announcing that they are planning to make Bitcoin trading legal last month, Russia banned LocalBitcoins on11th of September. The move came as a surprise to most, prompted LocalBitcoins to release a blog post explaining how to continue using the service through a VPN or the Tor browser.