Bitcoin might not be the most practically viable currency for India

Following a visit to India that involved interaction with a number of regulatory bodies in the country, EY’s Global Innovation Leader Paul Brody has indicated that Bitcoin and other cryptocurrency lack any concrete practical use in the country, given that local currency is deeply embedded in the economy.

The Bitcoin phenomenon has gripped the world in recent years, with the monumental fluctuations in the currency’s value causing its position in public opinion to shift between a temporary craze and the future of economic transactions. At its peak, the cryptocurrency has been used for major economic transactions, including mergers and acquisitions.

Bitcoin has been just as popular in India, while the technology upon which the cryptocurrency is based – blockchain – has gained even greater momentum across the country. According to Paul Brody, the currency lacks the potential to play a major role in the Indian economy.

Brody is currently a Principal and a Global Inovation Leader for Blockchain Technology at Big Four accounting and advisory firm EY, where he has been for the last four years, Before that, he spent more than 12 years at global IT giant IBM, where his latest role was that of Vice President and Leader for North America.

According to Brody, the Indian market lacks the potential to adopt Bitcoin in a big way, primarily due to it’s the embededness of the local currency. “Most people and companies earn their revenue and spend their money in local currency,” he said in an interview with Forbes India.

The resistance to Bitcoin is not necessarily a negative, given that Brody believes it to be a currency that has a tendency to cause deflation. “Most economists agree that deflation is, in fact, extremely bad for economies. Inflation, particularly out of control hyper-inflation, has not been a real risk in mature economies for decades,” he said.

The Reserve Bank of India has been engaged actively in curbing and regulating the spread of Bitcoin in India. Blockchain, on the other hand, is set to boom in India as per Brody’s analysis. “While there are some regulatory issues, our discussions with government agencies in India suggest that they are ready and interested in the use of this technology for business applications,” he said.