This is my answer to one of the questions asked by one of my Followers Hive account@akdx. This was the question he asked.

My Answer

I believe the whole point of Cryptocurrencies is to cut off the Middle Man and the charges that come with it. I am referring to our Banks in this Case. Plus the other Point is Inflation.

When a Cryptocurrency is created it has a certain Supply Cap which almost in most cases cannot be increased. This is the reason why the price of Bitcoin is so High. It's just Supply and Demand same as that of Gold. Since Gold is found in a limited amount it's Price is Higher than that of Silver.

Now if the Indian Government creates their own Fiat backed Cryptocurrency it would definitely not be Immune to Inflation infact it might Inflate our Currency even Further as they have cited that Paper Currency will also be Used at the same Time.

Now if we talk about how this Scenario will have an affect on the Cryptocurrency Market in India I just have to say that yes it would be Tough to get Fiat for Cryptocurrency but it wouldn't be Impossible on a Plus side the Government will have no chance of Knowing if you are Dealing on Cryptocurrencies. Over the Counter Trading will take off. Take China as an Example they are still Trading over the Counter as Bitcoin cannot be stopped by any Single Country.

The above Answer is entirely my Thought and I might be wrong about it so I would love for you Guys to Join me in the Comment Section and add something to my Knowledge.