By Aparna joshi Sep. 04, 2016
The Isle of Man has bought into the vision of an Indian mathematician to develop a virtual currency that helps prevent bribes. Could this system be replicated in India?
In the near future, on the Isle of Man in the Irish Sea, a few bored teenagers will stand in museum staring at notes of currency and metal coins in vacuum-sealed enclosures. “Men would once exchange goods and services through physical currency,” a curator will drone on as the teenagers take notes. These teenagers have heard of this kind of money; their parents once used it. But the idea of carrying around physical currency is outdated to them. They depend on a virtual currency that is transferred directly into their accounts. If they ever need to pay for dinner or go for a movie, they wouldn’t need banks or ATMs, but access to their mobile phones.
The reason these teenagers will never have to carry cash again is that the Isle of Man has bought into the vision of a mathematician from Gujarat, Nilam Doctor. In 2012, Doctor founded GreencoinX, the world’s first identifiable crypto currency. Recently, his company has won legal recognition to make the island of about 1.3 million people the first GreencoinX powered economy in the world.
Doctor, a 55-year-old man who lives in a tiny cottage in picturesque Mount Abu, has always been consumed by the idea of a creating a digital currency that operates within legal framework (unlike the infamous Bitcoin, which is viewed with great suspicion for being out of government control). Bitcoin offers near anonymity and is hence the favoured option for drug dealers, terrorists and other criminals. But Doctor feels that virtual currency, if used correctly, could be the future of money. With a few tweaks to the software, Doctor says he’s on his way to creating a digital currency that the good guys can use too.
“Imagine a world without black markets or bribes,” Doctor tells me, his eyes shining with conviction. I’m inclined to laugh off his utopian world-view, but he’s not kidding. Unlike Bitcoin, he says, GreencoinX is a traceable currency, with a strong inbuilt security system, KYC (know your customer) requirements, and coding in accordance with Foreign Exchange Regulations Act. Roughly translated, this means that in an economy working on GreencoinX you will not be able to bribe a police officer, pay for a flat with black money, settle your accounts with the neighbourhood drug dealer, or siphon funds to a terror outfit. In the event that you violate the law with a GreencoinX, your information will be recorded in a codified public ledger that is available for inspection with the right key.
In India, Doctor does not have an easy path ahead to legitimising his currency. The government, the banking industry, and the black economy will all fight him tooth and nail.
It may sound ideal, but Doctor says it will be hard to replicate this system in a country like India, especially since we run on a parallel cash economy. Making the change will require a complete technology overhaul, including the creation of accessible exchanges, merchant onboarding, and down the line supplier payments.
But before that, it will take an amendment in legislation, which could take years, given the bad press Bitcoin gets. Doctor says that after he presented a paper on GreencoinX in December 2013, he had the Enforcement Directorate land up at his Ahmedabad residence, and newspapers go to town decrying him as the “mastermind of the Bitcoin”. A few people went as far to suggest that he had a stash of 60,000 crore bitcoins and was helping fund Narendra Modi’s election campaign.
But the silver-haired, soft-spoken mathematician is calm about the future. “I am a developer of the ideology of change, and ideology takes time to change,” he says. Doctor says banks ignore him because they are terrified of losing saving account and credit card revenues. He believes they’re ignoring the fact that the bankable population could only stand to increase exponentially with GreencoinX.
“While virtual currency transaction charges are ungoverned by government rules, banks could still earn more due to higher transaction numbers,” he points out. “If we can make it work for 1.3 million people, we can make it work for 1.3 billion too. It may take me another ten years to convince the government but I am not giving up.”
The good Doctor perseveres. He and his American partners have secured funds to set up a development team in Dallas. They have spent nearly $5,00,000 on the project, and now after three years of hard work, they have a band of around 1,000 supporters from across the world, and an understanding with government of the Isle of Man.
In India, Doctor does not have an easy path ahead to legitimising his currency. The government, the banking industry, and the black economy will all fight him tooth and nail. In a country where you cannot get a car parked without greasing the hands of a watchman, Greencoin X sounds like a pipe dream at best or the fevered fantasy of a mad mathematician at worst. But, then again, human progress has taught us that it is the people who think they can change the world, who actually go do it.