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Looking at their monetary systems, cryptocurrencies have various coin-creation and supply mechanisms. Some cryptocurrencies are inflationary because the supply of coins increases over time. Inflationary cryptocurrencies use a combination of predetermined inflation rates, supply constraints, and mechanisms for distributing tokens to maintain the supply and incentivize participation in the network.

Inflationary have a steadily increasing supply of coins entering the cryptocurrency market. Typically, there is a predetermined rate of inflation set, which specifies the percentage increase in the currency’s total supply over time. Moreover, the inflationary token’s maximum supply is usually fixed or variable, setting the total number of tokens that can be created. Once the maximum supply is reached, no more tokens can be minted.

Nonetheless, different cryptocurrencies still have varying tokenomics, which may be adjusted over time. For instance, (DOGE) once had a hard cap of 100 billion tokens until the supply cap was removed in 2014. With this decision, now has an unlimited supply of coins.

How does an inflationary cryptocurrency work? Inflationary cryptocurrencies distribute newly minted coins to network participants utilizing dedicated consensus mechanisms, such as proof-of-work (PoW) and proof-of-stake (PoS), through which new coins can either be mined into existence ( ( )) or distributed to network validators ( ( )).

Through Bitcoin’s PoW consensus mechanism, miners validate transactions and are rewarded based on who solves the puzzle first. In PoS, when a block of transactions is ready to be processed, the protocol will choose a validator node to review the block. The validator checks if the transactions in the block are accurate. If so, the validator adds the block to the and receives ETH rewards for their contribution, generally proportional to the validator’s stake.

In some cryptocurrencies, the distribution of new tokens can be influenced by governance decisions. For example, decentralized autonomous organizations ( ) may vote to release treasury funds, change staking rewards and set vesting periods, ultimately affecting the currency’s inflation rate and the distribution of new tokens.

What is a deflationary cryptocurrency?

Deflationary cryptocurrencies deflate over time because the supply decreases. Deflationary tokens use various mechanisms to reduce their supply, with coins usually destroyed through transaction fees and coin burning.

Deflationary cryptocurrencies have a predetermined deflation rate coded in the protocol. This rate determines the percentage decrease in the currency’s total supply over time. For instance, a cryptocurrency might have an annual deflation rate of 2.5%, meaning that the currency’s total supply will decrease by 2.5% annually.

Like many inflationary cryptocurrencies, deflationary cryptocurrencies can have a fixed or variable maximum supply that limits the total number of tokens created. Generally, no more units can be minted once the supply limit is reached, but this is not always the case.

Notably, the of deflationary cryptocurrencies is influenced by stakeholders’ incentives, including miners, developers and users, who have varying motivations and goals that impact the cryptocurrency’s supply and demand. mine new coins into existence and tend to hold newly mined coins in bull markets instead of selling them on the market. Likewise, supply caps can be removed, like in the case of DOGE, making some cryptocurrencies prone to manipulation.

How does a deflationary cryptocurrency work?

Deflationary cryptocurrencies may have direct or indirect mechanisms to destroy circulating coins. Some deflationary currencies may use transaction fees to facilitate burning to reduce the total number of coins in circulation. Coin burning may also involve sending a specific amount of coins to an inaccessible address, directly removing them from circulation. BNB (BNB) adopted two coin-burning mechanisms, reducing its supply by 50% over time. The first is burning a portion of the BNB spent as gas fees on the BNB Chain, and the second is quarterly BNB burning events.

Deflationary cryptocurrencies also use other instruments to reduce token supply, including “halving.” Roughly every four years, the halving event cuts the ming rewards BTC miners receive for their work, directly affecting BTC’s scarcity.

What is the difference between inflationary and deflationary cryptocurrencies?

Inflationary and deflationary cryptocurrencies differ in their monetary mechanisms and supply dynamics. These distinctions have significant implications for the usage and value of each type of cryptocurrency.

Both deflationary and inflationary cryptocurrencies can have unique that impact their value and use. Deflationary cryptocurrencies typically have a fixed total coin supply limit, which results in increased purchasing power over time. Inflationary cryptocurrencies often have a flexible coin creation rate, arguably decreasing purchasing power over time.

Inflationary cryptocurrencies offer some advantages over deflationary ones. They incentivize spending and discourage hoarding. Depending on the use case, they may allow for increased liquidity and rapid adoption, either due to their utility or functionality as a medium of exchange.

Additionally, they arguably offer a more flexible monetary policy than deflationary cryptocurrencies and some fiat currencies. The token’s inflation can be adjusted to match the ecosystem’s needs, such as fund development, incentivizing participation or counteracting inflationary pressure from the fiat legacy systems.

Deflationary cryptocurrencies incentivize holding and discourage spending, increasing scarcity and adoption of the currency as a store of value.

Additionally, deflationary cryptocurrencies can hedge against inflation, and stagflation, preserving value over time. The decreasing token supply can counteract inflationary pressure caused by external factors, including government policies or economic events.

Inflationary cryptocurrencies vs. Deflationary cryptocurrencies

Is Bitcoin inflationary or deflationary?

The classification of Bitcoin (BTC) as either inflationary or deflationary depends on various factors. BTC is inflationary because new coins are continuously mined and enter the supply. However, disinflationary measures, such as halving, reduce inflation over time.

The argument for BTC being deflationary is based on the fact that the supply of BTC is limited and inherently incorporates a disinflationary measure called halving. The halving event cuts the rewards for miners, affecting BTC’s scarcity and reducing inflation over time. As the mining reward continues to fall over time, it becomes increasingly difficult and expensive to mine BTC.

The 21 million cap on supply means once all coins are mined, no more are added to the market. Once BTC’s hard cap is reached around the year 2140, inflation stops because no new coins will be added into circulation. Finally, as the adoption and demand for BTC continue to increase due to rising external demand and its internal disinflationary mechanics, its price could continue to increase. BTC can hedge against inflation due to its internal mechanics, which gradually reduce its inflation rate.

Is Ether inflationary or deflationary?

The classification of Ether as either inflationary or deflationary is a topic of debate. Supporters of the inflationary argument may point to the absence of a hard cap on Ether’s supply. However, the programmed decrease in the token creation rate, the implementation of PoS and its increasing utility in the ( ) ecosystem suggest a deflationary trend for ETH.

’s ecosystem facilitates the development of decentralized applications (DApps). Its native currency Ether is used for transactions and as a reward for validators who process transactions. There is no fixed limit on the total supply of ETH, but the rate of new coin creation is designed to decrease over time.

Pre-Merge, the annual issuance rate of ETH used to be approximately 5%, which meant that the circulating supply of ETH increased by that amount each year. However, the move to PoS resulted in the diminished issuance of ETH via rewards to validators, arguably resulting in ETH becoming a deflationary asset. Importantly, as the Ethereum ecosystem now uses PoS, the validators must stake their ETH as collateral. As more ETH is locked up in the network, the supply of ETH available for trading decreases, which could lead to an increase in its price over time.

Moreover, those who favor the notion that Ethereum is deflationary may point to its growing utility and adoption. As more developers build DApps, the demand for ETH will likely rise, increasing its price. Furthermore, as the Ethereum platform continues to be used for DeFi applications, the demand for ETH for payment and collateral could also increase, potentially leading to further price appreciation.

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Scheme (KPCS) has been introduced by (UN) General Assembly Resolution to certify that the shipments of rough diamonds are free from conflict diamonds. The KPC Scheme requires that each shipment of rough diamonds being exported and imported should accompany a validated Kimberley Process certificate by the Government of the respective countries.

Under the Process Certification Scheme (KPCS), the Government implements safeguards on shipments of and certifies the as conflict-free. According to this Scheme, each shipment of rough diamonds has to be accompanied by the Kimberley Process certificate and to be transported in a tamper-resistant container. The KP certificate states the authenticity of the rough diamond. To discuss your case with , please schedule your tele-appointment.

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⛔ Authority for Kimberley Process:

In India, Gem and Jewellery Export Promotion Council issues Kimberley Process Certificate and certifies the diamond as conflict-free.

The Kimberley Process Certificate will be verified and validated by the Gem and Promotion Council (GJEPC), which has been designated, under the Certification Scheme, as Importing-Exporting Authority by the Government of India.

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DeFi (ODFC)

DeFi is coined with two words 'Decentralised' and 'Finance'. DeFi allows crypto users greater control over their funds. It consists of multiple financial products and services, which are easily accessible to anyone from anywhere via the Internet.

Before starting you should be aware that, buying or selling crypto assets is taxed at a standard rate in India. Any kind of cross-border transactions are regulated by FEMA law and guidelines provided by the Reserve Bank of India. Please, get advice from ( ) as per your requirements.

How to start with DeFi?
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It is important to do your research about the various aspects of a DeFi protocol. This post is provided here on the ODFC page of your place to educate yourself about DeFi as there are several risks associated with it. Risks such as rug pull scams, fake projects, exit scams, and others, so learn about them before investing in any DeFi protocol.

Here are some of the steps to get started with DeFi:

1) Set up a Crypto Wallet -

Crypto wallets are digital wallets that allow you to store crypto and interact with various DeFi protocols. Usually, there are two types of digital wallets: Cold and Hot wallets. Choose a that best serves your financial interests and goals. Get help from Support Chat 💬 and subscribe to the exclusive services.

2) Acquire Crypto Coins -

As you may know in , where you need a bank account/ to load cash in your trading account to invest money in the stock market, similarly here you need to acquire crypto coins to participate in and interact with various . Some wallets are on crypto exchanges, where you can purchase crypto coins. Most protocols are built on the platform, so it is advisable to start with ERC-20 tokens.

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and all other have been looting heavily from the under the pretext of a stupid , which supports the so that they can collect funds to promote banking for the .

Dear Sirs @ Reserve Bank of India
In the age of and ,
❌ - It is 100% unethical.

*Is fund received from NRI (OCI card holders) will be treated as domestic or foreign fund?*

Answer: It can be either of one and depends on the following two points.

*Repatriable Investments (Foreign)*

Such investments are made through money in Non-resident external (NRE) accounts or FCNR accounts. These types of accounts are funded by money remitted from abroad. Redemption proceeds of such investments can be repatriated.

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*Non-repatriable Investments (Domestic):*

If the mutual fund investment was made through Non-resident ordinary account, the redemption proceeds can not be repatriated. However, as per RBI, authorised dealers can allow remittance/s upto USD 1 million, of balances in NRO accounts/of sale proceeds of assets on production of an undertaking by the remitter together with a certificate issued by a CA in Annexure A and B as prescribed by the Central Board of Direct axes ( ).

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