Can we be a little bit digital?

The Prime Minister has been pushing people of India to give up cash and conduct all transactions through digital payments. All anonymity will disappear as people switch to digital payments, which will end corruption by completely opening up our lives to government scrutiny. But as notes come back into circulation, following demonetization, people are going back to cash because it is easy to use, there are no charges and no danger of hacking. But how far does the government want the people to go? There are a number of crypto currencies, starting with Bitcoin in 2009 which can be used to make payments. Crypto means hidden or secret, because these are not controlled by any government or central bank. Naturally, these currencies are preferred by criminals because of the anonymity they provide. A delicious irony because that is precisely the reason why Modi wants to get rid of cash altogether. For the billions of people who are computer illiterate it is impossible to understand how any currency, which does not exist physically, can have any value. They can apparently be mined online by using blockchain. The Winklevoss twins in the US think that Bitcoins are more valuable than gold and want to build a currency exchange using Bitcoins. They also want to start an Exchange Traded Fund, or ETF, to allow people to take advantage of its potential. In March, the US government regulator, Securities and Exchange Commission denied permission to the twins to set up an ETF which sent the price of Bitcoins tumbling from $1,300 to $1,100. How the regulator will supervise such a fund, where investors are unknown, is difficult to foresee. However, recently the price of Bitcoin has jumped to a record $2,700, while in South Korea it is available for $3,100. The jump in price is because the Japanese government has recognised Bitcoins for legitimate transactions. In Japanese yen there is a $300 premium over the price available in the US. In 2014, Mt Gox, a Bitcoin exchange, in Japan ceased operation, causing losses to a lot of customers. Like many digital startups many Bitcoin startups have also failed. While Japan has accepted Bitcoins as legitimate authoritarian governments are uncomfortable with its use. In February, China shut down two exchanges to stop flight of capital, while the Reserve Bank warned Indians not to use this currency because it has not been authorised. But that is precisely why it is so attractive to its users. Modi wants us to go digital, but, like pregnancy, you can't be a little bit digital it seems.