Goldman Sachs: India is returning to a barter system; Bitcoin is attracting the general public

Goldman Sachs, an international investment bank and financial services company, recently said India is returning to a barter system due to cash shortage.

Weeks after Indian Prime Minister Narendra Modi announced the scrapping of 500 and 1,000 rupee notes, the country’s financial situation appears to be improving. Livemint revealed that 95% of ATMs in India have been calibrated to recognize the new notes recently issued by the central bank.

However, there is still a major problem; while ATMs can recognize the new notes, the Central Bank of India has failed to print the new notes in the same size as previous notes. Therefore, most ATMs in the country will remain unusable without changing or overhauling all the infrastructure.

65% of ATMs are not functioning

In an interview with The Wall Street Journal, NCR Corp, one of India's largest ATM manufacturers, said that neither the central bank nor local governments informed us in advance of the change in banknote size. The central bank also did not consult ATM providers and commercial banks on whether the newly designed banknotes could be used in existing ATMs.

When NCR Corp's India managing director heard the news on television, he immediately called an emergency meeting to find a way to make their 200,000 ATMs compatible with the new notes as soon as possible.

Dastur immediately worked with regulators and ATM manufacturers to find a strategy to manually configure the country's nearly 400,000 ATMs. Dastur also pointed out that it would take the NCR Corp team nearly two months to complete the configuration of the ATMs, and that this only accounted for half of India's ATMs, and it would obviously take longer to fully return to normal.

As Cointelegraph previously reported, due to the shortage of new banknotes, the daily financial turnover of Indian families, workers and businesses has been in trouble, and some basic things are difficult to pay, such as rent, food, transportation and electricity bills. Because only 35% of ATMs are operational and NCR expects a 2-month manual configuration period, Goldman Sachs and other large financial institutions believe that some kind of barter system network will take over the country's monetary system.

Bitcoin appeals to the general public

As Indian authorities begin to seize and confiscate gold from businesses, households, and individuals, the only safe haven asset available to the general public in India is Bitcoin.

Unlike most traditional forms of value storage, Bitcoin is highly liquid, decentralized, and transferable, properties that gold and, of course, cash fail to offer.

The local Bitcoin trading volume and price in India are skyrocketing, and the daily trading volume of Bitcoin exchanges such as Coinsecure and Unocoin is increasing significantly.