With reference to ‘Bitcoins’, sometimes seen in the news, which of the following statements is/are correct?

1. Bitcoins are tracked by the Central Banks of the countries.

2. Anyone with a Bitcoin address can send and receive Bitcoins from anyone else with a Bitcoin address.

3. Online payments can be sent without either side knowing the identity of the other.

Select the correct answer using the code given below:

The correct answer is 2 and 3 only.

To understand why, let us carefully analyze each of the three statements about Bitcoin one by one.

Statement 1: "Bitcoins are tracked by the Central Banks of the countries."

This statement is incorrect. Bitcoin is a decentralized cryptocurrency, which means it operates entirely outside the control or oversight of any central authority — including central banks like the Reserve Bank of India, the U.S. Federal Reserve, or the European Central Bank. Bitcoin was specifically designed in 2009 by the pseudonymous creator(s) known as Satoshi Nakamoto to function without any intermediary such as a bank or government institution. Instead of central banks tracking transactions, Bitcoin uses a distributed public ledger called the blockchain. This blockchain is maintained collectively by thousands of computers (called nodes) spread across the globe. No single entity — governmental or otherwise — controls it. Because central banks are entirely bypassed, Statement 1 is false, and any option containing Statement 1 must be eliminated.

Statement 2: "Anyone with a Bitcoin address can send and receive Bitcoins from anyone else with a Bitcoin address."

This statement is correct. A Bitcoin address is a unique alphanumeric identifier — similar in concept to an email address — that any individual or entity can generate freely, without requiring permission from any authority. Once you have a Bitcoin address (derived from a pair of cryptographic keys), you can freely transact with any other Bitcoin address holder in the world. There are no geographic restrictions, no banking intermediaries to approve the transfer, and no prerequisites like a credit score or identity verification required by a third party. This open, permissionless nature of the Bitcoin network is one of its foundational design principles. Therefore, Statement 2 accurately describes how the Bitcoin network functions.

Statement 3: "Online payments can be sent without either side knowing the identity of the other."

This statement is also correct. Bitcoin offers a property known as pseudonymity. When you transact on the Bitcoin network, you interact using only Bitcoin addresses �� long strings of letters and numbers — rather than your real name, bank account number, or any personally identifiable information. Neither the sender nor the recipient is required to reveal their true identity to complete a transaction. The blockchain only records the addresses involved and the amount transferred. While the transaction history on the blockchain is publicly visible to all, the real-world identities behind the addresses are not inherently disclosed. This makes it possible for two parties to send and receive payments online without knowing who the other person actually is in the physical world. Hence, Statement 3 correctly captures the pseudonymous, privacy-preserving nature of Bitcoin transactions.

Summary of Analysis:

Statement 1 — Incorrect (Bitcoin is decentralized; central banks do not track it)
Statement 2 — Correct (any address holder can freely transact with any other address holder)
Statement 3 — Correct (transactions are pseudonymous; identities are not required to be revealed)

Since only Statements 2 and 3 are correct, the answer is conclusively "2 and 3 only".