Image Credit: Whatsapp
RBI had issued circular to restrict banks and other financial institution from providing cryptocurrency trading business in April 2018. To overcome this some this some exchanges introduced the peer to peer services.
India is the world's top recipient of remittances with its diaspora sending $80 billion back home in 2018. According to reports, WhatsApp, an end-to-end encrypted messaging platform, is targeting this market. Since India has a large migrant population, cryptocurrency would make transfer of money easy and the remittance payers need not have to pay a huge amount to send the money.
Facebook recently revealed it is developing a digital currency that would be rolled out to the WhatsApp users in India (over 200 million). This will enable users to send money both domestically and internationally. The coins launched by WhatsApp and other messaging platforms will be centralized unlike bitcoins which is decentralized. Other messaging platforms such as Space and Telegram have decided to launch their own cryptocurrencies.
Experts suggest that Facebook could "succeed where cryptocurrency start-ups have failed by introducing mainstream consumers to the alternative world of digital coins." Even though cryptocurencies have been in the radar for over a decade, it hasn’t been widely accepted and adopted by individuals and institutions due to the uncertainty and complications associated with the market fluctuations. With the WhatsApp cryptocurrency, Facebook could bring about a revolutionary change in the trend.
However, there are various hindrances to launching WhatsApp coin. Last May WhatsApp Pay was launched in India but was not popularly accepted and its roll out has been delayed due to RBI’s restrictions and data localization norms.
We have to wait and see how they will overcome the restrictions and norms of the Indian government and RBI regulations. Since WhatsApp is a widely accepted end to end encrypted messaging platform, more common people will be feeling secure about the WhatsApp’s idea of launching cryptocurrency if it happens.